“Were your ears burning Saturday night? Well, they should have been. I was at a party and ran into an old college buddy I hadn't seen in years. We started talking about this crazy world and the markets. I told him about your view and some of the strategies we have been pursuing. He was intrigued and wanted to hear more about you. He seemed to like what he heard because he asked me if you would give him a call. Here is his number.”
If you haven't been getting such calls from clients, you might want to reflect on why.
Consider this exchange with my friend, John. While on a cycling trip, we were catching up and John asked, “David, you are in the financial business — what do you think about gold? I am thinking about investing in some gold-mining stocks and maybe even in the hard asset.”
My response was one of surprise that he was just now thinking about investing in gold. My financial adviser had been advocating gold and silver for quite some time in light of his view of pressures on currencies across the globe.
John was intrigued and started asking questions about my adviser and how he could tap into his considerable expertise.
The end result? A wonderful referral for my adviser.
PERSONAL BRANDING
Generating referrals is far more about personal branding than asking for introductions. Creating a bridge to the referral, especially with the backdrop of the past few years of roller coaster markets, is essential.
What exactly is this bridge?
The bridge to referrals starts with the adviser's establishing a market view, a thesis or set of theses about where we have been, where we are now and what may lie ahead. The adviser then needs to communicate that view in simple, straightforward terms and explain how his or her clients are positioned to capitalize on this view.
Finally, the adviser's clients need to digest and understand the thesis thoroughly so that they are comfortable discussing it with friends, family members and colleagues when the topic of money arises.
The key isn't to ask for referrals but rather to create compelling reasons for clients to encourage their network of family, friends and acquaintances to contact their advisers. Asking clients for referrals often has the opposite effect.
Instead of inspiring confidence in the adviser, asking for referrals could make a client question why the adviser needs help securing new clients.
For example, if your cardiologist asked you, as a patient, to send some of your friends to him as patients, you would probably wonder why. Why would someone you likely consider a top provider in the field need to ask for referrals?
In many instances, it would erode your sense of that doctor's quality, ability and professionalism.
It is no different for advisers. People want to think that they are seeing the best cardiologist, and the same holds true for their financial health.
If they truly think that you are an expert in your field and extremely successful, then you should be turning away business because your practice is closed to new clients. Asking for referrals could severely diminish that impression.
A good referral doesn't feel like a referral. It evolves in the natural course of conversation that your clients may have about you when you are not in the room.
The exciting news for advisers is that referable moments are happening at an unprecedented rate. Clients talk about the markets and money with friends and family on the weekends.
In “normal times,” this isn't the typical topic of conversation. In the aftermath of the market crash, it remains a high-priority conversation.
Happy and satisfied clients are eager to share what they have learned from their advisers, and ready and willing to endorse their adviser to their loved ones.
So are you capitalizing on today's crescendo of referable moments? Are you getting many “Monday morning” calls?
If not, consider evaluating your personal brand and what value you bring to clients. Develop a consistent communication approach to ensure that your clients know that you have a strong view about the markets and understand their values and goals.
When your clients can explain your view and how you are helping them navigate the markets for long-term success, they will be well- positioned to highlight your expertise to their contacts. This will work toward securing your next referral the next time the topic of money arises.
David Richman is a vice president and national director of Eaton Vance Investment Managers' Advisor Institute.
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InvestmentNews.com/practicemanagement.
