Ask For Referrals

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Referrals are the best way to grow your business – but only if you ask. As a Financial Advisor one of your primary tasks is growing your business. But as you know, new clients don’t just walk through the door. You have to proactively prospect for new business.

One of the best ways to find new prospects is to ask your clients for referrals. Obviously, this is no secret. It’s the first rule of prospecting. Yet many advisors are still reluctant to ask their clients for referrals. Fear creeps in — fear of rejection, fear of giving the appearance of being needy, or simply fear of looking like the relationship is about your needs rather than the needs of your client.

Often, it’s just a matter of being uncomfortable or inexperienced asking for referrals.
Instead, advisors would rather take a passive approach and hope that clients will automatically offer referrals without being asked. Unfortunately, that’s probably not going to happen. You have to ask. Only then will you be rewarded with a steady stream of new business.

A change in mindset

In most cases, your clients don’t refer business to you because it simply hasn’t crossed their minds. Your clients all have busy lives, and the growth of your business is not among their priorities.

They might not even know that you’re interested in new clients or that you want to grow your business. And they won’t know it until you let them know. Here are some ways to change your mindset regarding client referrals:

  • Just do it. Asking for referrals probably means getting out of your comfort zone. But if you want to grow your business and earn more money, that’s part of the job. Take a leap of faith and start having those conversations with your clients.
  • Practice makes perfect. As you begin asking for referrals, the conversations may be a bit awkward. But like anything else, the more you practice the better you’ll get.
  • Build it into your process. The more times you ask for referrals the more success you will have meeting prospects and converting them to clients. Like any aspect of our industry, the more you do something the more you increase your odds of closing an account, it’s a numbers game. So build it into your process, and make a habit of asking for referrals when you talk with clients about their investment portfolio. Eventually, it will become second nature.

Working up to the “ask”

No question, it is difficult to ask clients for a referral if you don’t know whether or not they are satisfied with your service. Here are some ways to work through that reluctance and begin to ask the right people for referrals:

  • Find out if your clients are happy with your service. You want to make sure you are asking for referrals from clients who are happy and view the relationship as mutually beneficial. But you can’t read their minds, so you need to start asking for feedback on a periodic basis (not every contact) to gauge their opinion. During periodic reviews, you can ask for feedback to make sure you’re on the same page and moving in the right direction.
  • Knowing who to ask and how to ask. If you are getting consistent positive feedback from a client, you might say “I really enjoy working with you, and I’m glad that I have been able to help you work towards reaching your goals. I’m always looking for people like you to work with. Can you think of one or two people in a similar situation who could benefit from my help?”
  • Make it win-win-win. If you’ve done a good job for your clients, they will probably want to help you while also helping their friends. You can position it as a win for your client — who will have a chance to do a favour for their friend – and for their friend who will have the opportunity to work with you. Once you broach the subject, your best clients will begin thinking of friends and associates that they can recommend to you.
  • Who are you looking for? Be specific about the type of client for whom you are looking. For instance, if your strategies are specifically geared towards small business owners then highlight that and ask if they can refer you to other business owners.
  • Make it a two-way street. Whenever possible, always reciprocate. Don’t just ask for referrals, but give referrals back to your clients when the opportunity arises.
  • Show your appreciation. Most importantly, if someone has referred a client to you, always find a way to thank them. Send a handwritten thank you note with a small gift such as a gift card for dinner, or better yet, go out to lunch or dinner together on you.

New clients are the lifeblood of your business. It all starts by asking your clients for referrals.

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