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Some advisors have turned referrals into a strategic advantage. These seasoned veterans use referrals to filter market opportunities—if a center of influence does not refer you, you can't be a client. Other advisors have implemented a referral strategy to help them endure bear markets.
Become a referable advisor instead of an everyday advisor. Compare two types of advisors, referable and “everyday”, to visualize a growth-by-referral business model. Referrable advisors clearly understand how to articulate their value, whereas everyday advisors experience random growth.
How to become a referable advisor:
Focus on a niche market of high-quality referral sources. Relationship-building is more important now than ever. Knowing your client personally builds an environment of trust, integrity, and a connection that makes it comfortable for a client to refer you to their friends and family. Commit to a higher degree of familiarity with your ideal client. That way, you'll be able to better articulate to others the type of client you're looking to work with.
Develop a process to distinguish yourself from the competition and operate in a proactive environment. Investment practices rely heavily on referrals, so you'll want to recognize the need to systemize your business like a franchise. This requires effort and business acumen.
Consider the experience existing clients have gone through to help lead this creative process of articulating the transformational work you undertake for clients. Think about your client service process, investment consulting process, or other boutique examples of how you help clients through philanthropic endeavors, concierge home services, and cash flow management. What do you do that other advisors won’t?
Continually "wow" your clients, their prospects, and their professional centers of influence. A consistent "wow" factor allows you to deliver on a promise and demonstrate a high-quality client experience with relevant and meaningful insights, reports, and results.
Take control of the quality of your referrals. You will likely get new clients by associating your referral pool with your current top clients, much like your referring clients. Clients of referable advisors have a higher degree of trust and loyalty, typically have higher response rates, and don't "price shop" because they rank the opportunity to do business with someone they respect and trust far greater.
Offer what suits your client rather than only the products you represent. Today, clients can purchase investment products anywhere and from anyone. Clients look to you for advice on overall wealth management and planning solutions.
I would like you to keep focused on achieving top client referrals. While you may think the world of the referable advisor seems too good to be true, it's very achievable.
You probably have many of the building blocks in place, but you need to package yourself to be referable. How do you do that? Use the above as a framework. If that's not enough, call your Advisor Practice Management consultant, and we'll help you.
The best part about being a referable advisor is that the activities you engage in to make yourself even more referable will automatically enhance the value of your practice while helping you stay ahead of your competition. Once you can articulate value, systemize your business, and coordinate your team, there will be no reason for your prospects to look any further or clients to leave.
Related: The Advisor’s Growth Trap: Are You Truly in Control?