Investors are fine with trailer fees, survey says

Referrals can be a tricky subject to raise with a client, regardless of how solid your relationship is. It’s hard to identify that opportune moment when your client is more willing to hear your case.

You might decide to time the “referral talk” after delivering good news about their portfolio’s performance, or once a goal-setting session wraps up, says Evan Thompson, business coach and founder of Evan Thompson and Associates in Toronto.

But perhaps, instead of waiting for the right time, you might consider a strategy that encourages clients to make referrals on your behalf.

Thompson offers tips on how to handle the subtle — and not-so-subtle — ways of broaching the conversation about referrals with clients:

> Lend a second opinion
If your practice specializes in a niche, of which your client is representative, offer to spare some time to look over the portfolio of a colleague or someone within his or her circle. Make sure to express that the prospective client is under no obligation to commit.

You can use that opportunity to warm a potential prospect up to the idea of working with you. Turn it into a “fact-finding session,” in which you learn about the prospect while offering insights into how you might approach managing their finances, Thompson says.

Even if the exercise doesn’t result in a new client, there’s a chance the effort will earn some good will. That client might provide a referral later.

> Send out client satisfaction surveys
Use feedback as an occasion to get clients “thinking about all the work you do for them,” says Thompson. Among the questions about your service, you might include a line about whether they would consider recommending you as an advisor.

> Hold an open-invitation event
Parties provide a more relaxed atmosphere that puts people in a more generous mood.

And the holidays, says Thompson, are usually the best time to “harvest” referrals: “They’re in a more people-oriented space.”

At this time of the year, clients are more open to the idea of bringing a referral right to your door. For your next client event, extend an invitation to bring guests.

Even if you decide to keep your event strictly for clients only, throwing a memorable event will help urge clients to share their positive experience working with you, Thompson says.

>Blog about the referral process
Some clients may not be aware of how your business relies, to a certain extent, on referrals. One way of planting the “referral seed” in their minds, Thompson suggests, is to blog about how important referrals are to people in business.

“You’re giving the reader value and encouraging the reader to think about referrals for you, [especially] if you’ve earned their trust.”

Photo copyright: wavebreakmediamicro/123RF