3 Things Every Advisor Should Do to Increase Referrals

Nobody likes the fear of missing out. Whether you’re overhearing your friends talk about a movie you haven’t seen (spoiler alert!) or listening to your neighbors discuss how nearly everyone on the block has been going to the same dentist for years, feeling excluded stings. 

So how do you make your firm the buzzworthy talk of the town that people don’t want to miss out on? It starts with a solid referral process.

Easier said than done, we know. The challenges brought about by the pandemic added an extra layer of complication to the referral process last year, leading to an overall decline in requests industrywide. 

In fact, InvestmentNews found that only 18% of advisors report regularly reaching out to solicit client referrals. But just because you can’t physically hand a client a business card via Zoom or ask clients face-to-face to recommend your services doesn’t mean you should just throw in the towel. 

Take one look at LinkedIn or Facebook and you can instantly see the impact of digital referrals. More often than not, when you go out of your way to help a client reach their goals, they’re more than happy to introduce you to their network.

There’s no one-size-fits-all approach to getting your firm’s name rolling off people’s tongues, but there are some everyday activities you can engage in to increase your favorability and remain top of mind. 

Let’s take a look at three easy ways you can open up the referral faucet at your firm:

1. Build strong relationships with Centers of Influence

When you have professionals you value in your network, oftentimes they become your first point of contact when seeking other service providers. Just think of how many times you’ve needed a doctor who specializes in a certain area and turned to your general practitioner for recommendations. 

Leveraging professional contacts, frequently referred to as centers of influence (COIs), is a best practice in active communities. Some advisors even claim they get so many referrals through COIs that they don’t do any other form of marketing at all.

Get in the habit of going out to lunch with local community members who are well connected (e.g., attorneys, realtors, and accountants) to build up a strong network. 

Instead of specifically asking for referrals, let them know that you are happy to help any time and stay in touch. 

Don’t be over-aggressive with your referral outreach but make sure you keep the line of communication open so they feel comfortable connecting with you when the time is right. 

2. Give perks

Research shows advisors who give perks or incentives get more referrals. When clients feel like they are valued and understood, they are more likely to recognize your commitment to serve. 

Some of the most popular perks financial advisors provide include vouchers for wine tastings, golf outings, and dinners - but special benefits don’t always have to cost money. 

An abundance of expensive tickets and gifts may even have the reverse effect and make people question how much you’re charging. Read the room and balance out your offers. 

Your time is just as—if not more—valuable of a resource than monetary gifts. Helping your clients find a new car, plan a trip, or just spend time with them shows that you care about more than just their finances and want to see them excel in all facets of life. 

3. Have an amazing client experience

It should go without saying, but there is nothing more important than putting your clients’ needs first.

Actions always speak louder than words. 

Being structured and reliable shows you are on top of it and possess the competence needed to do your job well. Technology can play a major role in achieving this and positions you as forward-thinking. 

When you invest in tech solutions, it’s crucial that you know how to articulate the value of your new tools because your clients have likely not interacted with them before. 

They won’t care how much your technology costs or how many industry professionals use it. Rather, they’ll want to know why you invested in it and how it will personally impact them. 

Pay attention to how your clients respond when you go through tools with them, and address any concerns they may have. Giving an in-depth overview of their financial status and providing realistic actions they can take to reach their financial goals will give them peace of mind, boosting your credibility and increasing their trust. 

It can be discouraging to hear rave reviews from your clients but not see any new faces walk through the door, but with patience and kindness, you can get on the right track.

Your clients’ networks may not be ready to work with you now, but the goal is for them to confidently approach you when the time comes.