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How to get referrals right

Three advisers with very different referral strategies share their tips

Referrals are a great way to build your client base, but how do you get them and what do you do if a client referred to you is unsuitable? Three advisers share their experiences.

Patrick Waller

Attention to detail
Rather than asking existing clients for referrals, Financial Planning Partners managing director Patrick Waller prefers them to be given freely, without prompt.

In his experience, delivering exceptional service is the way to win more business.

Waller draws inspiration from other sectors. While on holiday in the Maldives, his jokey comment to a hotel concierge that an orchid looked lop-sided led to it being changed instantly.

He says: “I look at the service I get from hotels, restaurants, drivers and car dealerships. It’s about the little things. I’m a big believer in communication; it’s about how you talk to clients. Do you always communicate with the client after you see them? We phone the same day to tell them what’s going on and every time we receive new business from a referral, we send the existing client a gift – flowers, champagne, a race day. We always let them know we appreciate them.”

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Waller’s largest referral was from a client with a £5.5m portfolio about six months ago.

He says: “We thought, what can we get him? He’s got all he needs; he’s not interested in money.”

Ricky Chan

Choose a niche
When brothers Ricky and Alan Chan founded IFS Wealth & Pensions in 2013, they went to a lot of networking events with a view to building professional connections for referrals. “Networking helps you find out who you want to work with and who has clients that are compatible with your business,” says Ricky Chan.

“Another way of finding these connections is through existing clients. We do a lot of end-of-tax-year planning and ask clients if we can speak to their accountants to verify numbers. Over time, you build up a relationship.”

Once established, it is important to nurture and protect relationships with connections. For Chan, this means being willing to help everyone referred in some way, even if it means doing some work on a one-off basis for someone who does not fit the bill for ongoing advice.

“We are selective in clients we take on but if I can help an accountant’s client, it builds the broader relationship. If a client is not right for us, there is usually something we can do for them – something straightforward like helping set up a pension or having a quick chat. If they need ongoing service, I will point them to an online directory to find an adviser in their area.”

Tom Baigrie: Protection referrals are key to building trust

Chan suggests that when initially approaching professional connections, pitch yourself as a specialist in one area.

He says: “If you talk about everything you do, it will go over their heads. Pick a niche and get in the door that way. When they realise you are good at that area, they will ask if you work in other areas.”

Alan Knowles

Two-way street
Some advisers refer clients to others when they need a specialist in a particular field, for example defined benefit transfers or protection.

For the specialist adviser, these relationships need to be handled sensitively.

Specialist protection adviser Cura managing director Alan Knowles works with advisers on protection cases that are hard to place, such as clients who have complicated medical histories or health conditions.

“We work on the basis that we have got two client relationships: the IFA and the end client. We have got to manage both,” he says.

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“We don’t want to upset the advisers and poach their clients. We want to involve the IFA as much as possible in the early stages. If all we did was say ‘can I have the name and number of your client?’ we would not get very far.”

Knowles says difficulties can arise where Cura disagrees with the original advice given. “That usually comes down to the sum assured. For example, if £1m of life cover is needed for a 70-year-old but the adviser is struggling to justify it, that would put doubt and concern into our minds. It is overkill to need £1m to pay for a funeral – a £5,000 to £10,000 whole-of-life plan would be more suitable in that case,” he says.

For Knowles, the relationship between advisers is a two-way street: “If I was making the referral, I’d want to know who I am referring to and that they know what they are talking about, rather than referring blind. Trust and integrity are key.”


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