by Tony Vidler
When it comes to referral marketing efforts there are basically two types of consistent ongoing referrers you can cultivate:
1. happy & satisfied clients
The second category is the one that many advisers struggle with particularly, and the reason they struggle is because they try to develope the wrong people as potential centres of influence.
The accepted wisdom is that we should work with other professionals who are working with our ideal target market clients already. The typical centre-of-influence discussion revolves around how to get an accountant or lawyer as a centre of influence who is working with business owners for example, if “business owners” happened to be your target market. The underlying logic is that as they work with people you want to work with, then there must be some common interest. Unfortunately, there usually is not common interest other than you both want the same people to pay you. More often than not the adviser wanting referrals to the accountant or laywers clients is perceived as a threat. The adviser is seen as a threat to the potential COI’s revenue, relationship and reputation.
Unsurprisingly, the efforts of many advisers to cultivate “any” other professional to become a centre of influence generally fails. There are simply too many risks from the potential COI’s perspective.
Even when the adviser tries to cultivate another professional who the adviser themselves has a long-standing advice-based relationship with, and where there is significant goodwill and a level of trust it doesn’t quite pan out most of the time. There’s often a tentative start created on the basis of that relationship or goodwill, and some referrals flow both ways…but then it usually peters out.
It is not enough to find a fellow professional who is working with your target market already, and who you get on well with and have a good level of mutual respect and trust. Those elements are absolutely necessary, but they are not enough if you want referrals in volume. Here is an important point in working out who makes a good centre of influence: are you after a volume of referrals, or just a handful of absolutely ideal potential clients?
If you are a specialist then a handful of ideal referrals will often work very well – but that is not most financial advisers, and that is not what most think they are trying to create with their COI efforts. Most advisers ae after a steady stream – or a volume – of regular referrals that keep their own production pipeline full. If that is you, then here is the key to the right centre-of-influence:
It is a given that each of the professionals used in the example also give advice to their clients, and do it very well generally. But their business model is transactional. They get paid per successful project or placement, and then work jolly hard to make sure that client comes back to do the next purchase with them.
As far as business models go that has been a successful one for many decades for many professionals in a range of fields, and it leads to an innate understanding on their part that new engagements with new people is a critical success factor.
THAT is the missing ingredient that makes the difference between having a successful COI who can deliver a volume of leads or not. Finding the professional who needs it to work as well as you do, because their own business model has a need for a continuous series of new transactions.
Those professionals who are working in a comprehensive or complex advice space with their clients (even if those clients are your ideal target market) usually don’t want a whole heap of referrals from an adviser. That creates capacity issues for them inside their own business, as each “new client” to them represents a serious time and effort commitment on an ongoing basis.
To find the potential Centre-Of-Influence who can deliver volume and who is likely to be a genuine long term asset for your business, and who you can in turn be a genuine long term asset for, you need to find those professionals who are conducting non-competing transactional work with your target market.