There’s three fatal flaws in asking for referrals. So don’t feel bad if it hasn’t worked for you. It’s important to ask, but not for referrals. Here’s why asking for referrals fails and what to do instead:
3 Fatal Flaws
1) The Bait & Switch – Traditional requests for referrals come at the end of a client meeting, often as the last thing. In that moment, conversation dramatically switches from the advisor working for the client to the client working for the advisor. No wonder many clients look befuddled and stunned. At best, it’s startling. At worst, it turns a productive meeting into an unpleasant bait and switch. Intuitively, many advisors feel hesitant and for good reason.
2) Awkward! – In addition to the sudden switch, the traditional approach asks all clients indiscriminately. Unless they’re willing advocates, it’s very awkward. Few clients will openly tell their advisor “I really don’t want to solicit for you”. They’re just going to feel uncomfortable or worse, resentful.
3) Whose Job is it Anyway? If the advisor gets through the first two land mines without damaging the client relationship, all the responsibility is thrust on the client to deliver. It’s unrealistic to expect a client to do all the work for you.
How & What to Ask
1. Make a list of the clients that love you (you know who they are).
2. Ask for their feedback about what’s important for them, their colleagues, friends and family (but don’t surprise them during a review).
3. Serve those needs and deliver that value.
There’s lots of ways to deliver value: relevant education, community involvement and social gatherings. The right formula will depend on your market, your clients and their friends. One size does not fit all.
True Story: Big Success with Local Interests
An advisor and wholesale partner are building a referral network with women in their area. They’ve done several successful events with the women bringing more friends every time (by the way, they asked what the women wanted). The most recent event took the women to a shooting range, for weapons training. They loved it!
Obviously weapons training will not have universal appeal. Your local client interests will be revealed as you ask their wishes and those of their peers. You’ll have an opportunity to shine and they’ll have an easy and appealing way to include family and friends.