A recent client survey showed that only 2% of clients referred a prospect when the advisor followed the traditional approach of asking the client during a meeting.
The Bad News – That’s solid confirmation that the traditional approach of prompting clients to refer prospects just doesn’t work.
The Good News – If the traditional approach rarely worked for you, you have confirmation that you’re not alone and it’s not working for anyone, 98% of the time.
The Traditional Approach
When I ask advisors: “How do you ask clients for referrals?” I hear one of the following answers:
- I don’t
- I try, but am inconsistent
- At the end of the client meeting, I ask the client who they might refer
After #3, I usually hear:
The client looks at me blankly and says ‘I don’t know’. I don’t get any referrals, the client leaves and forgets about it. I’ve been taught how to do this, but it never seems to work, I don’t know what to do.
My job as a coach is to help clients get out of ineffective patterns by uncovering the problem and activating new solutions. First, let’s look at the problem with the traditional approach.
The Problem – Requesting Referrals “On Demand”
To understand why the traditional approach fails, we need to look at the situation from the client’s perspective. Let’s consider a setting where you’re the client.
Imagine you are at the doctor’s office for an extensive physical. You’re naked on the examining table while the doctor discusses your health. The focus is on you and your situation. At the end of the physical the doctor looks at you and says: “I am expanding my practice, what friends might you refer to me?”
What would you think? For me, I would be stunned and completely unable to provide an answer that would satisfy the request. After all, I am at the doctor’s office for my business, not for his (or hers).
The Key – The Client’s View
A client review meeting is essentially a financial physical. The meeting is about them and their business, not about promoting the advisor. When we take a moment to look at it from the client’s view, of course, they don’t come up with a satisfactory referral in that moment. How would you feel? Delighted and ready to deliver?
Actually, there’s considerable risk when surprising the client in this way. The client might feel any of the following:
- Stumped – The surprise element of the “client meeting ask” is likely to leave clients just plain stumped.
- Blindsided – The client may feel blind-sided by “on-demand” request.
- Obligated – Ideally a client wants to refer their advisor to new prospects. If they don’t, it may be an unpleasant obligation.
- Offended – Some clients may be offended. If the client expects the meeting to be completely about client business, the shift to advisor business can seem offensively self-serving.
The Action – Activate a Fresh Approach
What’s needed is a fresh approach designed around the client’s viewpoint and interests. Strategize with a peer or your coach to develop and execute a fresh approach. Below are 3 guiding principles:
- Focus on Confirmed Advocates – Don’t ask a client for a referral until you’re confident the client will want to give one. If you don’t know, gather client feedback to uncover your advocates. This does not have to be complicated. A few strategic questions, asked in conversation or more formally in a survey, will provide needed feedback. Then focus on working with your known advocates.
- Prepare the Client – Surprise gifts are fun, surprise requests are not. The client needs to be prepared to help you. Set the stage ahead of time. This can be done verbally or with written communication. During coaching, advisors and I develop a process to respectfully prepare the client to focus on “advisor business”.
- Make it Easy – The traditional approach expects the client to do the work of delivering prospects. They have to think of a prospect, name it immediately or deliver it later. Instead, do everything you can to make it easy for the client to help you. Here’s an example of how you might engage their help and make it easy for them:
First engage them:
You’ve provided me some great feedback on what you appreciate about our work together. I’d like to connect with folks who value the same things you do, in a way that’s easy and comfortable for you and for the folks you know. Can we set a time to chat about it?
Then make it easy to help:
Set a meeting that is about your business: lunch, coffee, a phone call, or whatever works for the client. Talk with the client about how to reach their connections in a comfortable way. Allow the client to do whatever the client prefers to do, then pick up the rest.
The principles above lead to a fresh approach that is good for the advisor and for the client. It’s truly a win-win.
Please Comment: Let me know your experiences in activating client referrals. What works? What doesn’t? What do you think of A Fresh Approach?
(comment directly below or email: email@example.com)
I’m in the ” inconsistent” part for sure, about asking for referrals.
However, I think I have made a little step forward in the past year:
After a successful client meeting– as we are saying our goodbyes– and they are thanking me as I am also thanking them– I say with a grin, ” You know, there’s one thing I’d like to ask of you.” What’s that, they say? ” Please, please, please, don’t keep me a secret!! and then I pause, and sometimes, they tell me that they’ve ALREADy told someone about me,a nd I get their name right then. It’s better than not asking at all, I think. Does anyone have any other suggestions to add to this?