by Tony Vidler
It never actually worked that well in the past really, and it works even less well today.
Adding an extra word in there doesn’t make it much better either: “who do you know WHO….” just makes things more awkward for most people most of the time.
The reason why this awkward and stumbling technique earns the label “time-tested” is because it has been around forever, and it does produce the illusion of generating prospects – with the occasional real prospect falling out of the process through happenstance. Serendipity in other words.
Picture the scene: you have done a good job with your clients and everyone is basking in the glow of having successfully waded through a 40 page Statement of Advice and having agreed to get together again to fill out another 2 hours worth of paperwork. Everyone is really delighted and upbeat at this point, right? Then you drop the Who-do-you-know bomb. If there was no buyers remorse beforehand, it just occurred at that moment.
Perhaps it was just a timing issue….it might be better to wait until we’ve had 3 or 4 meetings and they’ve waded through 5 hours of paperwork and then ask them? Maybe not…. Perhaps we should just jump in before they get overwhelmed by the process and the paperwork – grab the referral and then do the job?
If you consider it from the client’s perspective there is no right time is there? All you did was lob an unexpected bomb into proceedings.
And here’s a home truth: financial advisers are generally poor at getting referrals BECAUSE they’ve been trained to do it as I’ve just described…and they KNOW it sucks. So they don’t like doing it…because we all known that when you drop the bomb there is nothing but casualties.
Asking the old “who do you know” question is just dumb. Everyone hates it. There is never an ideal time for it. It puts people on the spot and creates tension and awkwardness that didn’t used to exist. It wrecks good business relationships.
It is a technique best reserved for the old school hard sell characters – it defines them as precisely that.
There are 2 key concepts which must be understood and acknowledged if you wish to get constant quality referrals:
1. You have to earn the right to them in advance
2. The person giving the referral is taking a risk.
There is a transfer of trust that occurs when a referral is given. A client is entrusting you with their own reputation and relationships with people that matter enormously to them. That is an incredibly risky thing for most people given how highly we value our relationships. Think about it: most of us place family and friends right at the top of our list of most important things on the planet. They are more important than your possessions or your charitable interests, or your business…they are what matters to us most.
You have to nullify that risk through demonstrated values and behavior if you want to to receive referrals constantly.
Which brings us back to the first concept: you have to earn the right to them. Your professionalism, your attitude, how you handle the information and relationships that your client can see…these are the things which reduce risk for a potential referrer.
Having earned the right to obtain referrals though still does not lay the groundwork for the “who do you know” bomb. It’s still a dumb tactic even if you’ve earned the right (in your own opinion) because it puts people in an awkward and semi-confrontational position immediately. The best that will happen most of the time is they might throw you a few names of people that they are relatively relaxed about losing as friends anyway, and they won’t give you a personal introduction. Congratulations you just received some new names for what is little more than a cold-calling campaign (maybe it is luke-warm calling?) and put a client relationship in jeopardy. Dumb.
You have to be referable first. You also have to set reasonable expectations and assume responsibility too though. That means you have to let clients know in advance that you expect to receive referrals if you are doing a good professional job AND have earned the right to be trusted with them.
I’ll demonstrate effective positioning for referrals in the next few episodes of Tony’s quick tips here on the blog.
You have to earn the right to receive referrals. You have to be positioned for them. You have to be known and trusted as a “safe” person with them.
Simply putting people on the spot and expecting them to name names is just dumb and sets off the bomb warnings in everyone’s heads.
© 2013 Tony Vidler. All rights reserved. All materials contained on this web site not otherwise subject to copyright of other parties are subject to the ownership rights of Tony Vidler. Tony Vidler authorises you to make a single copy of the content herein for your own personal, non-commercial, use while visiting the site. You agree that any copy made must include the Tony Vidler copyright notice in full. No other permission is granted to you to print, copy, reproduce, distribute, transmit, upload, download, store, display in public, alter, or modify the content contained on this web site.0