Creating a Culture of “Referability”

Clients don’t wake up thinking, “I’ve got to refer someone to my financial advisor!”
The thought may occur on the rare occasion a client is having a conversation with a friend, family member or colleague about finances. In addition to the scarcity of a spontaneous referral, clients simply may not know your story. They may not know if you have capacity to take on new clients, what type of client is a good fit, or what asset levels are appropriate.
As a result, it is important advisors be proactive in this process of generating and cultivating referrals. Educating your clients and enlisting their help is a good place to start. Let your clients know you are looking to grow your business, provide a target client profile and a list of your services and solutions. This can be done in a very professional manner that is not “salesy” or uncomfortable to either the client or the advisor. One advisor we recently worked with included an “ideal client profile” including minimum asset requirements to the end of their weekly newsletter as a way to educate clients and increase qualified referrals.
To increase the potential for referrals, consider developing a client referral plan. Tactics for increasing referrals could include creating an agenda item for referrals in quarterly review meetings, adding content to correspondence and developing a process of asking “money in motion” (MIM) questions. These MIM questions are designed to make you more efficient in the referral process and to help a client think through their mental rolodex for their friends, family and colleagues who might need your help with a liquidity event now. 
A good example of a MIM question is, “among your friends, family or colleagues, who is the most likely to be considering selling their business?” Another might be “among your friends and colleagues who is close to retiring in the next 3-6 months.” By being specific in your request, you can help your client narrow down who they are thinking of and produce a more qualified referral.
Your CRM system should be the heart of your referral process. It will help you keep track of many important aspects of your plan, such as who has referred in the past, how that referral is contacted, what materials are sent, and how and when to thank the client giving the referral with a letter or other gift. Leveraging CRM technology can help automate this process to ensure that nothing falls through the cracks.
Lastly, by having a formal referral process in place, it helps to create a “culture of referability” within your firm that allows you to tap into your number one and largest sales force: your clients.
By George Tamer and Arun Murthy
George Tamer, Director, Strategic Relationships, TD AMERITRADE Institutional
George can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it.
Arun MurthyCFP®, Manager, Strategic Relationships, TD AMERITRADE Institutional
Arun can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it.
1 50,000 Clients Can’t Be Wrong: Advisor Impact Client Index: 2009 - November, 2009
TD AMERITRADE, Inc., member FINRA/SIPC. This is not an offer or solicitation in any jurisdiction where we are not authorized to do business. Past performance of a security does not guarantee future results. All investments are subject to investment risk, including possible loss of the principal invested.

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