Obtaining Professional Referrals — Beyond CPAs and Attorneys
From the day you started in this business, you probably heard that your best prospecting system is referrals. Referrals may be the producer’s best source for new clients, but how do you get more high quality referrals than your existing clients can provide?
The best way to gain additional high quality referrals is to form “host-beneficiary” relationships. The “host” is an entity or professional who has clients that you want. You will show the host why it is in his interest to refer clients to you. You becomes “the beneficiary” of the host-beneficiary relationship.
These relationships’ benefits include:
• Prospects will be “warm” because someone they trust will have recommended you. They already know about the you and your service.
• After the you have established these relationships with hosts, it doesn’t take much time to maintain them. Therefore, you can focus efforts on meeting with prospects and clients, instead of on the telephone begging for appointments.
The most common kind of host-beneficiary relationship would be strategic alliances that you develop with other professionals, such as accountants or attorneys who serve the kind of clients you want to target. Your goal should be to develop a network that will refer business to you, and you will reciprocate by sending clients to other members of your strategic alliance. But the you must start thinking outside the box to make this referral system sizzle.
For example, to get insurance referrals, life agents long ago started calling on property/casualty agents, as property/casualty agents make the perfect hosts. In return, the life agent can provide referrals or compensation (depending on state law).
Perhaps your specialty is money management. In this case, you should work with professionals who see money in transition and can refer you clients. This is money that recently has been acquired and must be invested. It could come from a business sale, lawsuit, divorce, property sale, lottery prize, or death benefit.
Sources who would know about this money in transition go beyond the obvious attorneys and accountants. Additional sources include real estate brokers, business brokers, and funeral directors. How many relationships do you have with these kinds of professionals? In each case, you the the capability to refer business to them or compensate them if legal in your state.
Give First to Receive
Call the professionals you want to meet. Tell the professional that you have clients who might be able to use their services, and offer to take them to lunch. What professional would turn you down? At lunch, the find out about them, their practices, and what kinds of clients they want. Position yourself as a resource for those kinds of clients. Establish your value to this professional as a means of building his practice. Offer the professional referrals first, as a show of good faith.
You and your professional, your new host, also can discuss mutual marketing techniques that can help both build practices. Leave the lunch with a joint marketing commitment, such as mailing to each other’s client lists, a jointly presented seminar, or a mention in each other’s newsletters. Listen to an audio on how this referral program works.
Another good way to find professionals with whom to align yourself is to ask family and existing clients. Your top clients likely work with accountants or attorneys with whom you may be able to partner. An introduction from a mutual client gives you instant credibility with these possible partners.
Creative Possibilities
A little creativity can go a long way in the producer’s search for good “hosts” with whom you can partner. I knew a long-term care insurance producer who contacted a local hospital’s senior services coordinator. Hospitals actively court the seniors in the area. They provide free blood tests, cholesterol screening, exercise classes, and so on.
This producer offered to teach a monthly class on long-term care insurance. The hospital viewed his classes as an added service it could offer the seniors.
Each class the producer teaches introduces him to the attendees and establishes him as a trusted expert. He spends the days after each class meeting with seniors, in an office that the hospital provides, writing applications for LTC insurance. He found the perfect host and now he is a rich beneficiary.
This approach was so successful that this now is his sole marketing method. He travels his state giving classes on long-term care insurance, and writing policies after them. He is a top LTC producer.
Other creative possibilities include:
• Local professional associations. Join the local real estate agent association as an associate member. Develop relationships and let them know you are seeking, for example, senior clients who are trading down and will have a wad of cash to invest, or young families with income over $100,000 and three children for a significant life sale.
• People who sell office furniture. They can introduce you to business owners with expanding businesses who might need insurance, estate planning, and investment advice.
• Teachers. If college funding is your market, teachers might be a good source of referrals to parents. Almost every county has one or two teachers associations you can probably join.
It takes some creative thinking to establish good host-beneficiary relationships, but once in place, most take little maintenance. By offering a winning solution to a complementary professional seeking to grow his or her own business (or seeking extra income), you can effectively create a stream of additional business for yourself.
Investing the time it takes to design and implement a referral system for obtaining high quality referrals from clients and other host-beneficiary relationships may be the best investment you can make in your practice. Once in place, your referral program should provide a continuous stream of prospects. For some advisers, this may be all the marketing they need to reach their income goals.
