Time to automate your referral process

Less than 10% of advisers actually have a formal referral process that is proactive in nature, have documented steps that can be measured, and a process that is systematized to become a powerful growth engine. Timothy Welsh writes: This needs to change.
JAN 22, 2014
It’s no secret that the vast majority of new business for 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, have 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, 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.” However, in these more complex, competitive and interesting times, that passive approach to waiting for the phone to ring may not be sustainable. Evidence for that trend has also been documented in various industry studies that showed advisory firms were not bringing on as many clients as they had in the past. 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 believe 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 get their marketing messages distributed in a broad and efficient way. When combined with workflow tools in CRM technology and content marketing platforms, advisers can develop a systematized and automated way to keep track of who is referring, 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 like Vestorly. Vestorly recently made headlines by offering their tools for free for financial professionals. Through a service like Vestorly, advisers can publish targeted content to their client and prospect networks. If the content is forwarded on 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 ongoing content marketing. 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 your local University and advertise a marketing internship for an MBA candidate with a technology background to spend a semester building out the steps of the referral process, including the various communications, letter templates, follow up steps, thank you gifts, etc. and build out those workflows in your CRM system. From there, your tech-savvy MBA intern can then integrate that process into a platform like Vestorly for online content publishing and voila, you now have a proactive marketing engine that will position your firm as forward looking and on the growth track. Timothy D. Welsh is president and founder of Nexus Strategy, LLC, a leading consulting firm to the wealth management industry. Tim can be reached at [email protected] or on Twitter @NexusStrategy

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