Client Communications

Don’t put your clients on the spot

By Tessie Sanci |

Much of what you have been told about attracting referrals is misleading or inaccurate, says Stephen Wershing, president of the Client Driven Practice in Rochester, N.Y.

"Most people are taught or believe that their clients aren't giving referrals because the advisors aren't asking for them. That's not true," says Wershing, author of Stop Asking for Referrals: A Revolutionary New Strategy for Building a Financial Service Business that Sells Itself.

In fact, requesting referrals from clients could be one big reason why your strategy is not striking a chord with clients.

Wershing shares the following three common errors in the way financial advisors approach referrals:

1. You ask for referrals
Whether we're telling our friends about a great movie, restaurant or financial advisor, we are constantly providing referrals.

Giving referrals is a social need that we all have, Wershing says. It makes us feel good to help a friend solve a problem.

One thing that does not inspire a positive feeling is being put on the spot. Imagine you are at a restaurant and the waiter asks you for the names and phone numbers of five friends who eat out periodically. It is unlikely you would comply, Wershing says, or that you would return to that restaurant.

"That's what we do to our clients all the time," he says. "That's not the way to get referrals because it doesn't respect why people refer in the first place."

2. You're not the "obvious choice"
You want to be the first name a client thinks of when a friend says he or she needs financial advice. That means developing a specialty that puts you above other advisors.

You might think you limit yourself by marketing your services to divorced individuals, for example. But you could be the only option for people in that situation within your community.

You should strive, Wershing says, to be the answer to the "Ghostbusters" question: if anyone in your target market asks, "who are you going to call," you should be the obvious answer.

Keep in mind that people often have like-minded acquaintances to provide social support. So, your specialty of serving divorcing couples — or successful doctors — can open you up to others in their group.

3. You talk about yourself too much
Communicating with a client can be like talking to a date. Would you go out again if all that person did was talk about himself or herself? Would you tell your friend it was a great experience? Not likely.

The whole point of the interaction is for both individuals to learn more about the other.

"Connecting with clients is about talking about them," says Wershing. "That can lead to things you've done, but it's not the focus."

If, for example, you specialize in working with the families of special-needs children, you might ask a mother of a special-needs child about her joys and challenges. Then, you can add what you have learned from other families in similar circumstances.

By guiding the conversation in this direction, you've given your client an opportunity to open up but also subtly implied your experience and expertise  in working with families just like hers.

This is the first installment in a two-part series on improving your referral strategy.

Next: Incorporating your clients' input.