Time for financial advisers to automate their referral process

NOV 01, 2013
It is no secret that the vast majority of new business for financial advisers originates from a referral from either a client or another professional. Yet when asked, less than 10% of advisers actually have a formal referral process that is proactive in nature, and has documented steps that can be measured and a process that is systematized to become a powerful growth engine. Why is this, then, when over 80% of clients, according to Pershing Advisor Solutions LLC, are willing to refer their adviser to their friends and family? Through conversations with advisers and consultants over the years, it often comes down to the fact that advisers as a species are a shy bunch. They are often hesitant to reach out in fear that they will come across as “salesy” and not a professional investment and financial planning practitioner. Other reasons we see are the fact that they have had no real training in how to market or conduct business development for their firm. Their calling card has always been to “deliver outstanding service and let the new business take care of itself.” In these more complex, competitive and interesting times, however, the passive approach of waiting for the phone to ring may not be sustainable. Evidence for that trend also has been documented in various industry studies which showed that advisory firms aren't bringing on as many clients as they have in the past.

BRIDGE TO THE GAP

So what is the answer here? Perhaps technology can be the bridge to this gap. If advisers had an automated way to systematize the steps and tactics to nurturing referrals, might they be more willing to be more proactive? In this case, I think that the answer is yes. With the widespread adoption of new online communication channels and social media by investors of all ages and demographics, advisers have available to them powerful content-publishing and communication tools to distribute their marketing messages in a broad and efficient way. When combined with work flow tools in customer relationship management technology and content marketing platforms, advisers can develop a systematized and automated way to keep track of who is referring and who isn't, as well as provide an automated way to track referrals through the sales funnel. As an example, consider an emerging online content marketing platform such as Vestorly. The firm recently made headlines by offering its tool for free for financial professionals. Through a service such as Vestorly, advisers can publish targeted content to their client and prospect networks. If the content is forwarded by a client or prospect to someone else, Vestorly provides that data in a dashboard, providing an automated and efficient way to identify referral opportunities and nurture those through continuing content marketing.

MARKETING INTERN

But of course, developing a systematized approach to referrals takes work. Everyone is busy these days, so how can advisers get this done? One idea is to go to the local university and advertise a marketing internship for an MBA candidate with a tech background to spend a semester creating the steps of the referral process, including the various communications, letter templates, follow-up steps, thank you gifts, etc., and automate those work flows in the CRM system. From there, the tech-savvy MBA intern can integrate that process into a platform such as Vestorly for online content publishing and voilà, there is now a proactive marketing engine that will position the firm as forward-looking and on the growth track. Timothy D. Welsh is president and founder of Nexus Strategy LLC, a consulting firm that serves the wealth management industry. Tim can be reached at [email protected] or on Twitter @nexusstrategy.

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