Unlocking referrals

If you are not confident in your business proposition and the value you are offering, then how can you be confident in asking an existing client or potential source for a referral?

What makes you referable? It is a question that almost every adviser needs to be asking themselves as we enter a post-LIF environment. If you cannot answer this question, are you really confident in your business proposition? If you are not confident in your business proposition and the value you are offering, then how can you be confident in asking an existing client or potential source for a referral?

The rigorous judging process for the AFA Adviser and Practice of the Year awards is one that asks hopeful applicants that very question. As we move closer to the final announcement of this year’s winners, it has become increasingly apparent that these leading advisers can instantly recall what sets their business apart, and can do so from both their own and their clients’ viewpoint.

The ‘referability’ of these advisers is built upon:

  • delivering the emotion of happiness to their clients;
  • having a process that often uses client diagnostics and personal feedback;
  • differentiating that process between clients and various referral sources; and
  • having a high level of emotional intelligence.

In their bid to achieve ‘referral excellence’, all advisers are faced with the challenge of engaging clients in a meaningful way that not only produces the best outcome for that client but is also powerful enough to compel that client to refer the adviser within their own social circles.

The key here is to remember at all times what the core service is that you are providing. For example, when it comes to insurance, a client may buy – and you may talk about – an insurance policy; however, what you are offering and what they are ultimately after is simple – it is peace of mind. The peace of mind that, when faced with a major life risk, they (or their loved ones) will be financially looked after when they need it most. It is no more complicated than that, and it is what Australia’s leading financial advisers know and focus on doing well.


The AFA Adviser of the Year and Practice of the Year process focuses on best-practice financial advice and uncovers how clients truly feel – before, during and after the advice process. What often comes to light is that tapping into the core motivators of clients – in regard to their values and their innate human needs – not only endears the adviser to the client, demystifies the process, and maximises the possibility of a prospect becoming a client, but also ensures that the wellbeing and sense of self of the person receiving the advice is markedly improved.

Making clients happy is key

Happiness makes us want to share – not just within our social circles but also in a virtual forum such as sites like ‘Adviser Ratings’[i]. Happiness is achieved by bonding, and in the financial planner’s office, when a client is most likely feeling emotions of fear and anxiety, people look to cope with those feelings by bonding with the adviser and the advice process. Researcher Lea Dunn describes this process as follows: “In the absence of friends, consumers will create heightened emotional attachment with a brand that happens to be on hand”[ii].

This begs the question: how strong is your financial planning brand? Keep in mind that you and your staff embody this brand, which is the very thing that clients are looking to bond with.

The role of accountants

The classic solution has often been the lunchtime education or information session where we talk to accountants about the benefits of TPD insurance and just expect them to spread this amazing news to clients.

Of course, I make light of the value and depth that many education sessions hold but the expectation that we have of the impact of these sessions is often unrealistic. That is not to say they don’t work – they can do over time. However, despite their regularity and the range of topics these sessions encompass, the conversations we hope the accountants have with clients often don't follow.

We need to start looking at alternative techniques and this year’s Adviser of the Year and Practice of the Year finalists have provided us with just that.

  1. It is about the only time during the day that the six-minute clock isn’t ticking and the accountants down tools. Rather than just an education session, consider just having lunch with them and not talking about anything to do with financial planning. It’s a lot easier to get a referral from someone who likes you.
  1. It’s a must, but it needs to be tailored so that life risks are not at the forefront but rather, the risk to the accountancy base is. Highlighting that business expenses cover can protect the accountants’ fees (they are a valid business expense) is one way to make the accountant feel the need to have a valid discussion with a client.
  1. Get an exemption from the six minutes. This means the conversation is ‘authorised’ and the client and accountant are not held to the six-minute charging regime.
  1. Create a process. A questionnaire that acts as a rating scale (i.e. scores points for having certain structures and strategies in place) provides a great rationale for a referral to an adviser.

The role of mortgage brokers

Adviser of the Year and Practice of the Year finalists have also explained that the ‘when and how’ of the referral positioning is critical. To address this, many of the finalists have made it easier for their brokers by providing them with some simple scripting, such as:

"My biggest concerns in securing this loan for you are…”

  • … you get a competitive interest rate
  • … the fees are minimised
  • … you get the loan size you need
  • … you can manage the repayments
  • … you can always afford the repayments even if you can't earn an income through accident or illness

“Let's start by focusing on the loan."

The role of clients

The nature and collection of feedback is key to boosting referrals. One of this year’s finalists has gathered formal client feedback since 2001 and the explanation of how they communicate to clients is simple:

“As our business is built on referrals, our existing clients are our biggest advocates. The constant source of referrals from our clients means we can spend less time on activities to find new clients and more time developing and servicing the solutions for the clients that find and stay with us.

Any feedback during and after the development of your solution will be greatly appreciated so that we can strive to have you as another client advocate and have a positive influence on not only your situation but for the people you value in your social and family circle.”

Emotional intelligence

Communication, sharing and bonding are inherent human experiences. As a student of psychology, I believe that the manner in which we as humans (and as clients) look to bond with each other, and look for reassurance and social proof before we act, lends itself to a process of engaging with clients that taps into this inherent aspect of human nature. This is what we call ‘emotional intelligence’.

Critical in any communication with a client, including when asking for referrals, is having the proper psychological processes in place that address the clients’ experiences in dealing with you, as well as the satisfaction with life and wellbeing they achieve as a result.

Everything you do as advisers, be it insurance advice, business insurance, intergenerational advice or aged care, needs to incorporate this strategy. It is something that this year’s Adviser of the Year and Practice of the Year aspirants know, it is something they have built the proper processes around, and something they continue to use to unlock plentiful referrals of the highest quality.

[i] Seiter, C, The Science of Emotion in Marketing: How our brains decide what to share and whom to trust, March 2014.

[ii] ‘Want brand loyalty? Scare your customers’, media release, University of British Columbia, 5 February 2014.

Andy Marshall is head of sales strategies and research, Zurich Life and Investments

Other articles written by Mr Marshall can be found here:

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Business success with succession planning


Unlocking referrals
Andy Marshall
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