Referral wrap-up: How to thank your clients for recommending you

(June 2004) As I discussed in the past three columns, a client’s personality makeup can sometimes make it impossible to induce referrals no matter how good a job you do. Getting that initial referral takes a lot of hard work on the advisor’s part, and for most clients, overcoming the natural apprehension about introducing friends and family to their advisors is a significant accomplishment.

The good news is the first referral really is the hardest. Once you’ve broken through that introduction, others will follow more readily provided you do two things.

First, ensure you have a process in place from the get-go, so that every new client is impressed by your professionalism, diligence and commitment to their needs. This is doubly important for clients who are referred to you.

Second, you need to ensure that clients who have provided a referral feel genuinely appreciated for their efforts. Once a client refers you once, this is the single most important thing you can do to get future referrals. Say thanks right from the start by following the initial introduction with a simple phone call or note (or both) of thanks to the referring client.

Another opportunity to thank a client for a referral can occur when the referred client comes on board. There are many ways to do this. A few examples include extending movie passes, a box of chocolates or even a donation to the client’s favourite charity. One advisor sends clients a giant chocolate chip cookie saying, “A million calories for your confidence.”

Still, another advisor sends a gift even if the prospect declines to sign on! The accompanying note says, “I wanted to let you know that after two meetings Bill and Joanne have decided, for the moment, to stay with their existing advisor. We have agreed that I will stay in touch with them. In the meantime, I want to sincerely thank you for your confidence in introducing us and hope you enjoy these cookies as a small token of my appreciation.”

You should also have a variety of ways to thank clients since there’s always the risk they might question the spontaneity of your gesture, especially if it’s the third time you’ve sent a gift basket or flowers. But you can also sporadically seek fitting opportunities to remind them of your appreciation.

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Acceptance speech The “A-list” of referrals

For example, every December, one advisor drops by with a special gift to wish holiday greetings to clients who have provided referrals that year. One year, for example, it was a centerpiece for a table. He simply thanks the client for the opportunity to work together over the past year and for their confidence in making a referral.

In an even more ambitious example, one Toronto-based advisor hosts an annual trip to the Shaw Festival in the Niagara region for a half-dozen couples who have provided large referrals in the past year. He provides theatre tickets, hotel accommodations and breakfast the next morning where he thanks attendees, making it clear the reason they are there is to be thanked for referring their friends and family.

Although the cost is significant — approaching $2,500 — the impact has been spectacular. There has been an immediate spike in referrals from those clients, and it’s not because they feel coerced or guilty, but because they are genuinely feeling more positive toward their advisor.

There is no one way to thank clients for providing referrals. The key to acknowledging clients — just like it is when asking for and accepting referrals — is to find an approach that works for you and to apply it regularly. Only by putting consistent processes in place will you maximize your flow of client referrals.

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Dan Richards is author of Getting Clients, Keeping Clients: The Essential Guide for Tomorrow’s Financial Advisor and is based in Toronto. His column “Marketing Frontlines” appears every month in Advisor’s Edge. Dan can be reached at richards@getkeepclients.com.

06/18/04