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Practice Management > Building Your Business

How to Get More Referrals Without Begging

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If you ask most agents and advisors, they will say that one of their practice goals is to get more referrals. After all, when you get a referral, it’s much easier to set appointments. Even better, those appointments tend to be more productive since the prospect arrives with a higher level of trust and a certain belief in your expertise. Wealthy investors say 58% of them found their current advisor through a referral. Testimonials can really help also.

With so many advisors looking for desirable clients, the client finds their advisor via a referral less than 11% of the time. Surprisingly, less than 20% of financial advisors ask for referrals consistently. Advisors and agents realize the power of referrals, but they still struggle with how to tap into their database without coming off as “sales-y” or desperate.

(Related: 8 Knockout Approaches to Virtual Networking)

There is an inherent discomfort in asking your best clients to put their reputations on the line and recommend you to other people in their lives. This discomfort means many agents and advisors sit around waiting for referrals to fall from the sky as if by magic.

What can you, as a trusted financial advisor who performs an incredible, life-changing service for your clients, do to ensure that they won’t be shy about recommending you to others? I have found a few best practice referral techniques that you can use to help generate more referrals from your warm market and improve your bottom line dramatically.

1. Change the way you think about referrals.

Many books and articles are written about developing a “referral mindset.” Creating a referral mindset means that you must make the shift from being commission and sales-focused to becoming more of a long-term thinker. When you begin to imagine a referral-based business’s power to free you from the expense and grind of constant prospecting, you will find yourself doing more of the things that make getting referrals possible. You should always expect referrals; adopting this mindset will create the setting for referral harvesting.

2. Know your ideal client.

Too many advisors spread themselves thin over a wide range of clients in different phases of their financial lives. Before you implement a referral program, you need to know what kind of clients you want to add to your database. Once you discover this, it will be easier to find those “birds of a feather” who can introduce you to more people just like themselves.

3. Make a list of your best clients.

Once you know what kind of referrals you want, make a list of your top 10 to 15 clients. These are the people who are most likely to associate with your ideal demographic. Ask yourself, “Who do these people know that I would like to know?” A favored referral is generally an easier prospect with whom to work.

4. Give people two business cards, not one.

While this may seem too simplistic, it works. It works because it sets the stage for the client to realize you need and want referrals. This one is simple: when you hand out your cards, give everyone two instead of one. Use this language; it has worked for me. Here is my business card for your friend who drives the most expensive car and has the most speeding tickets.” Why that language? Because it is completely different, and they will remember what you said.

5. Send thank you cards.

I always send thank you cards. In the card, I include my business card with a note on the back of it saying, “If you know anyone who might benefit from my information, please pass this along.”

Always send a thank you card to anyone who does send you a referral. I usually include a $10 Starbucks gift card with a note saying, “Your next latte is on me!”

6. Remove referral risk.

Asking for a referral is a little like asking someone to become a matchmaker for you. One reason why people are hesitant to make introductions is that they are afraid of being embarrassed. Your clients are putting their reputations on the line for you. If you make a mistake that costs their friend, family member, or colleague money, it might harm the relationship.

To remove some of this referral risk, you have to conduct your practice in the most client-centric way possible. Let your referral source know that you have a “white glove” procedure for handling each person they send your way. Assure them that every referral you get is handled responsibly and ethically.

It is possible to build a practice that is based entirely or mostly on referrals. Many advisors have created referral-based businesses by using specific protocols developed through understanding their ideal client make up. Such protocols ensure a consistent approach based on bringing value and exceptional service to every referral.

How you present yourself, the confidence you exude in the information you provide clients, and the completeness of your fact finder given back to them (typed) at the beginning of the second meeting will seal the deal. The referrals become a natural part of your sales cycle.

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Steve KerbySteve Kerby is a financial professional with Retire Village. He has been selling life insurance and annuities for 51 years.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.