THOUGHT LEADERSHIP
The power of these trusted connections is evident in the financial advice industry . We surveyed around 700 people to understand behaviours and attitudes to referrals . Finding an adviser through friends , family and colleagues was the main path ( 38 %) for those who now have an adviser . Still , there ’ s untapped potential in your clients ’ networks . Two-thirds had never recommended their adviser – yet 50 % said they would if given the opportunity . That means that given the right conditions , your referrals could double . We recognise that asking for referrals can feel uncomfortable , for you and your clients , so how can you ease this process and unlock their potential ? Here we present our findings and outline a strategic approach you can take to boost referrals for your business .
Understanding referrals in four phases
A new client by referral isn ’ t something that happens in one go . We ’ ve identified four phases where your referral potential can be impacted .
1 . Client relationships Simply put , if your clients aren ’ t happy with your services , they won ’ t refer you . They must feel satisfied with your service and recognise the overall value you bring , beyond just your technical expertise . It ’ s important that your clients have an accurate perception of your value as this is what they ’ ll ‘ transmit ’ to their friends and family when talking about you .
2 . Transmission This is the stage where your clients choose to engage – or not – with their peers about you . When they do engage , they ’ re effectively promoting you . We call this phase ‘ transmission ’. In this moment your clients are the gatekeepers defining a first impression of you . What they say and how they say it could make all the difference .
3 . Contemplation A prospect is unlikely to become a client overnight . They might take time to research you and your competitors and think about their options . It ’ s important that prospects find information and stories that resonate with them , such as relatable , quality reviews from other clients .
4 . Connection The peer of your client has made contact – how do you successfully get them over the line as clients ? This phase is about making a human connection , demonstrating your value and following up at the right time .
During the contemplation phase , potential clients could be put off if they don ’ t feel connected with you . Finances are a means to goals and wellbeing , so people need to feel connected to you at a human / emotional level . In the connection phase , human elements such as procrastination and lack of motivation could deter a successful referral . Establishing an emotional connection and having a wellstructured process is important in turning a prospect into a client .
Drivers of referrals We know what ’ s blocking referrals , but what drives them ?
• Satisfaction – as you ’ d expect , the more satisfied a client is , the more likely they are to refer .
• Being proactive with check-ins – proactively calling your clients is associated with a higher chance of referrals .
• Indicate your capacity for referrals – when you ’ re clear and intentional about your ability to help their peers , clients are more likely to refer .
A systematic approach to becoming referrable
So far , we ’ ve done a deep dive to understand referrals . But how can you use this information in a systematic way ?
1 . Reframing referrals – it ’ s all about helping People just want to help those they care about . In our survey , 96 % of those who had made a referral said their main motivation was to help their family , friends or colleagues . Not to help their adviser .
TWO-THIRDS HAD NEVER RECOMMENDED THEIR ADVISER – YET 50 % SAID THEY WOULD IF GIVEN THE OPPORTUNITY . THAT MEANS THAT GIVEN THE RIGHT CONDITIONS , YOUR REFERRALS COULD DOUBLE .
The barriers and drivers of referrals
Barriers to referrals Providing good value and having satisfied clients is crucial , but good motivation and intent are often not enough to guarantee successful referrals . You also need to identify bottlenecks and remove barriers . The biggest drop in referral potential comes during the transmission phase , which relies on your clients ’ interactions with their peers . Here are some of the barriers that could come with this phase :
• lack of opportunity to discuss financial advice with peers
• people feel uncomfortable discussing finances with peers
• your clients aren ’ t aware that you ’ re open to referrals . Transmission isn ’ t the only phase where bottlenecks can occur .
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