WHEN to ask for referrals

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Science and the Quest for Referrals
When to Ask for Them

Most advisors fail miserably at getting referrals. But why? If we assume they’re competent professionals, why don’t their clients give them referrals? The simple answer is, they drop three different balls:

1. They don’t have an effective system for getting referrals.
2. They don’t know WHEN to ask for referrals
3. They don’t know HOW to ask for them.

If that’s you, it means you’re working far harder and getting far less return. But you’re not alone. Exceedingly few advisors are able to consistently generate referrals. This Brief introduces you to the first bit of psychology you need to grasp. ( Send me an email, and I will send you the complete article. michael@aboutpeople.com )

When to ask for Referrals 

Obviously, you can’t ask when you first meet the client because you have not yet built any value. So, what builds value? And, how much value is enough? We teach our clients to use two tools: 1) the Rule of 3 and 2) the Value Credit Card. They work together like this:

The Rule of 3 is simple in practice. The psychology is based on a mental filter called Convincer Strategy. It's how many experiences a person must have before he's convinced to take action. Most people’s Convincer Strategy is satisfied by three experiences.

The Value Credit Card is also simple. To get a referral, you have to earn the right to ask for it. And you earn that right by reaching out to your client with what we call “Value Events.” Each value event puts one point into your Value Credit Card. You cannot ask for a referral until you bank three points, and they come from two sources:

Source One - Performance: 

1.  If you're an agent, planner or advisor, you're in luck.  You gain points when the portfolio does well, when you delight the client with your financial plan, when you satisfy their immediate need, or when you exceed their business expectations.  If you're a wholesaler, you gain points when your product solves the client's needs.

2.  Referrals.  You gain points by giving your own clients referrals.  In addition, this teaches them that you value referrals.

Source Two - Personal Connection and Communication:

1. "Meaningful" written connections, such as personalized greeting cards, post cards and letters.  The key here is to make it personal and meaningful.  You cannot send everyone the same thing!  You cannot send something that is meaningful only to you.  And, you cannot gain points from email.

2. "Face to face" personal connections, such as personal visits, lunches, sports events and other non-business activities.  Anything connected to your business costs you a point. 

3. "Meaningful" gifts.  You don't get more points for expense, but you lose a point if the gift is not relevant or meaningful to the client.  Books are great gifts - if the client reads.  Plants are great - if the client is a gardener.  Music, pens, golf balls - but only if they are meaningful to that person.

The easy solution.  One of the easiest ways to get those points is by sending personalized greeting cards. However, most people drop this ball by sending the same cards at the same time. Birthdays and big holidays. Why would you purposefully do anything you knew everyone else was doing? The idea is to show yourself as different and better, not as another in-the-box clone. 

Here's an example of how to do it right.  Because I'm a Marine Corps veteran, I understand the emotional connection veterans have with their service.  We created greeting cards for our clients who are military veterans. The cards have their service emblem printed on the front and a personal note on the inside. It’s unique, personal and connects to that person at an extremely high value. (Want to use this tool? Just send me an email and I'll explain it to you.)

Your Reward

Getting referrals requires you to think strategically, and to use tools that help you be more effective. Send me an email ( michael@aboutpeople.com ) and I will teach you how to use one of the most effective tools we’ve ever found to build value with clients – thus earning you the right to ask for referrals!

-- Michael Lovas

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