A vast majority of IFAs rely on referrals and word of mouth to grow their business. To ensure that you keep getting clients through referrals, it is important to understand why clients refer you and how you can match their expectations.
Here are a few things that clients consider before referring you:
Reputation and work ethic
It matters to clients with whom they are dealing with. They will do some research and visit your social media profiles before reaching out to you. Remember that you are a professional and your reputation is a key factor to attract more prospects.
Your reputation also means how well you value your clients. This means constant follow up and being available at the time of need.
Experience and longevity
Since experienced advisors are easy to trust, your clients would want to refer an experienced advisor who has been in the business for a long time. Today’s investors are one of the most informed segments of the population and would prefer an advisor who can fully understand their needs and goals.
Ability to handle pressure
Why is Indian cricket team captain Dhoni considered one of the best captains in the world? This is because apart from playing good cricket, he is known for his ability to handle pressure during difficult times. Similarly, your level of patience determines how well you can handle pressure during a market turmoil. It is very natural for clients to panic when markets crash but it depends on you how well you keep them away from this pressure.
Listening
What clients want you is to listen them and offer a solution. Thus, don’t try to make a sales pitch. Instead, be emphatic and put yourself in your client’s shoes. Focus on making them feel important and clients will refer you to other prospects.
Communication
Your success depends how well you communicate with your clients. Keeping in regular touch with clients informally or through review meetings will help you know your clients better. They have expectations from you and the way you fulfil them determines your credibility to get more referrals.
Various studies show that advisors must overcome the barriers of communication to improve productivity.
A study conducted by Raymond James, a financial services firm based in US found that found that 90% of clients refer their advisors because they trust him/her. Another set of people think that their advisor is highly knowledgeable (81%) and the remaining set of respondents are happy with the service provided by them.
According to an investor satisfaction survey by J.D. Power, a market research firm based in US, advisors with the happiest clients had these traits in common:
- Communication - contacting clients four or more times a year
- Clarity - openly explaining pricing and fee structures
- Conscientiousness - Discussing and effectively incorporating risk tolerance into a client’s portfolio
- Candor - Clearly communicating reasons for investment performance
