Referrals are a function of great service. It is rare that a client will refer after inferior service just because they like us. The product or service must be extraordinary. Our clients will brag about a great product or amazing service. They like having made a good decision — and they like telling others. By trying our best to give them the best, they can show others the outcome.

A new client has an inherited IRA. She was considering taking out more than her required minimum distribution because she needed extra income. I located two annuities with excellent income riders. One would pay $13,280 per year for life. The other would pay about $12,200 per year for life. If I gave her the lesser amount I would’ve earned $2,300 more in commissions. Aside from the obvious correct choice, there is a side benefit for doing the right thing: She has already referred another client with the same problem. The new client was thrilled by the idea of not exhausting her IRA while taking out more each year.

When I look at a term insurance sale, I match my offer with what clients can find online. I give them the best available. They can’t beat it. If I were to sell them a term product that has a higher premium, it would be obvious that I’m after the greater commission. I would rather give them more coverage. I’m paid the same or better, but they can brag to their friends about where they bought their very affordable life insurance plan. How embarrassing would it be if they had a friend who bought from IntelliQuote.com and, when checking on the price, realized they could have bought their life insurance at a lower premium at the same rating?

When entertaining clients, it’s not wise to ask for referrals. That’s rude. They actually know that you need them and will refer if they feel good about it. People who don’t refer are fearful of the outcome. They are afraid that when you call the nominee, you will badger them and hard sell them. That’s because of how they were sold, which is one of the main reasons people don’t refer.

If you will allow people to buy based on the merits of the concept or product, they will be more likely to refer because they think that their friends will have the same pleasant experience. If your sales process is high pressure, you can be sure that you will never get referrals. People may buy, but they won’t refer due to a high pressure salesperson. They will protect their friends from the same ordeal.

It may make sense to examine your referral volume. Many amazing practices don’t need to market because of the referral of new prospects by clients. Their reputation creates referrals. They have been patient and attentive to their clients’ needs for many years. It pays real dividends to go the extra mile.

Give extraordinary products and services. You’ll get extraordinarily happy, referring clients.

As a postscript, just this morning I spoke with a lady who called, asking if I’d be interested in a hearing exam. I told her that she could come to my home office and that my clients meet me here. She asked what I do for a living. I told her that I help retirees with their finances and savings. She said she was afraid of the market. I told her that her advisor would be sure to console her if she lost money — part of their job is to learn how to make people feel good when they lose money. I told her that since my clients don’t lose money, I was able to skip the course on how to handle an unhappy client.

We now have two appointments. I like the idea that she has a hearing aid practice. I am sure that she has the ability to refer a large number of clients. I’m looking forward to working hard to gain her trust and offer extraordinary service and products.