Beyond referrals

Referrals. They’re the lifeblood of many a financial services practice. Without them, books of business fail to grow, practices stagnate, incomes fall and careers fade. But even with referrals advisors can find themselves working too hard, chasing a numbers game that rewards too few and punishes too many.

“We used to do the numbers game, and we got business,” says Todd Wooten, president of Wooten Financial Services in Valparaiso, Ind. (www.wootenfinancial.com). “But we didn’t get long-term business. There was no loyalty factor.”

The difference between cold leads and warm leads is obvious to any advisor, but what about the difference between a referral and a personal introduction?

Referrals come in a couple of different manifestations. One type is where the advisor never even knows it was made: “Hey, this guy took care of my financial plan. You should call him; here’s his card.” The other leaves the advisor stuck making calls and name-dropping — “Hey, Mr. Advisor, here is a list of names and numbers of friends of mine you might be able to help” — which can work to a satisfying degree in many cases but leaves something to be desired.
Personal introductions from other professionals — whether in the financial services arena or peripheral to it — trump either form of referral. They carry an implicit endorsement of the advisor and, by taking place in the other professional’s office, can put all parties at ease.

Many advisors already have these kinds of relationships in place, having cultivated them for years. While the list of potential allies can be long, there are a few professionals that come up repeatedly. The big five are detailed below. These are folks whose help can take an advisor’s practice to the next level, provided the advisor is willing to do the same in return — actually, provided the advisor is willing to give something first. When seeking out these all-important alliances, remember one thing — maybe the one thing that costs some advisors the relationships they seek: “Give value before asking for it,” says Jack Keeter, president of Jack Keeter and Associates (www.jackkeeter.com) in Anaheim, Calif. “They’re going to want to know, ‘What’s in it for me?’ Convince them of the value you bring.”

Attorney
If this list were to be broken out by more specific individual titles, attorneys might occupy half of the top 10, that’s how often they are mentioned by advisors. Senior advisors likely are most interested in lawyers who specialize in elder law and estate planning — they have clients in the right age group and with the right needs. Keeter says estate planning attorneys are nice to form alliances with because they “deal with people at transitional times in their lives.” Estate planning attorneys are there when there is a death in the family; when someone is readying for retirement; or when someone receives an inheritance — all situations that make people take a second look at their entire financial picture.

Wooten says attorneys are a solid addition to any advisor’s team because — like it or not — they are higher up the admiration-ladder than advisors.

“People respect attorneys before planners,” Wooten says, especially in light of all the recent negative coverage of the financial services industry generally and annuities specifically.

CPA
Advisors love getting introductions from accountants. CPAs have access to all of the information an advisor needs to help clients and they have their clients’ trust, especially if they are as adamant about doing what’s right for the client as good advisors are. Nathan O’Bryant, president of O’Bryant and Associates (www.obryantandassociates.com) in Huntingdon, Tenn., works with a CPA, and he wishes he could work with many more. It’s not for lack of trying.

“In such a rural area, there’s only one CPA in town,” O’Bryant says.
Why does he like CPAs so much?