Systematizing the Referral Process for Financial Advisors

Remember that episode of “Seinfeld” where Uncle Leo gets Jerry’s father a last-minute appointment with a top notch back doctor? And when Jerry’s father accuses the office of stealing his wallet, Uncle Leo is mortified since he gave a personal recommendation and asked the back specialist for such a big favor.

Although this scenario was from a sitcom, it is not far off from the view of the financial advisory world held by Mike Garrison, a business coach and best-selling author. In his just-released book, “Can I Borrow Your Car?” Mike highlights the importance of knowing and trusting both parties in a referral: who you’re referring and who you’re referring to. If you “loan” a key relationship out by making an introduction, you want absolute confidence the individual will come back to you without dings, dents, or scrapes.

One of the first things Mike said to me when we began working together a few years back has really stuck in my brain: “Mike, if I refer someone to you, I want them back.” In other words, it’s the opposite of Uncle Leo’s experience. Uncle Leo probably destroyed whatever relationship he had with this top doctor after the wallet debacle, and he can probably never go back himself.

Top Financial Advisors & Referrals

Our readers and followers know the emphasis we at Blueprint Investment Partners place on being an uncommonly great partner to our financial advisor clients. This is evidenced by our “The Elite Advisor Playbook” and advisor practice management blogs.

A key theme we champion for top advisors is efficient repeatability, as well as discipline.

‘Can I Borrow Your Car’ book by Mike GarrisonSimilarly, Mike’s approach to referrals – a common characteristic of most successful financial advisory practices – seeks to systematize the process. Mike argues that there is a major and crucial difference between “accidental referrals” and predictable ones, and the latter has a much higher level of success and profitability.

It’s the predictable referrals, Mike says, which are the holy grail of a successful and sustainable business. In his book, he highlights the steps advisors can take to create thoughtful, consistent, and predictable referral streams.

I’ve highlighted some of the key takeaways and action steps in the remainder of this blog.

When’s the Best Time to Plant a Tree?

How can we expect a seed planted yesterday to bear fruit tomorrow? There’s some work required in the in-between time, such as watering and weeding.

The same concept applies to referrals. The process requires careful and thoughtful planning.

Just like any other type of marketing, predictable referrals follow rules and use data. However, truly successful and sustainable referral systems are fun, easy, and intently focused on reducing the risk (perceived and actual) to all participants. In other words, a referral can be made, or requested, in the context of normal conversation and there is little to no risk of ruining an important relationship.

Just as ingredients matter for a sustainable investment plan, they are just as critical for a successful and predictable referral strategy. The planning aspect of building your strategy is crucial, as is focusing on the right segment of your network and client base. The planning, development, discipline, and ingredients are as critical to growing a successful referral stream as the watering and pruning is to the tree.

Blocking Out the Noise

From an investment perspective, Blueprint has written about market predictions being a waste of time. We think they are simply unnecessary noise when you have a predetermined and disciplined plan in place.

A similar plan can be established to streamline referrals, and it does not have to be complicated.

In fact, less is more, according to Mike. A handful of a financial advisor’s clients should become your core focus when creating a predictable referral strategy. Specifically, Mike suggests the following steps for advisors:

  • Focus on your most successful referrals over the last few years. Consider how they materialized. Where and how did they originate? What parts of these success stories can be replicated?
  • Further drill down and identify your “best” clients, who are at the intersection of enjoyable to work with and profitable to your practice.
  • Segment this pool into those who have referred you previously and those who have not.

By this point, you should hopefully have 5-10 potential centers of influence. Next steps are to:

  • Create, and most importantly customize, a consistent outreach and communication flow with this elite subset based on their needs and passions. Offer as much of the communication in person as possible. Ask yourself how else you can help these clients personally and professionally. Mike shares that in his 20 years of referral coaching he cannot recall a time where an increase in client conversations did not lead to referrals over the following months.
  • Be specific about what you’re looking for, what things and people you need to grow your financial advisory practice. What are the personality traits of the individuals you’d like referred to you? What field are they in? If you believe one of your 5-10 connections knows someone specific you want to meet, then be precise with your ask. Tell them why you would like to be introduced, and make it EASY for them to refer you by owning the narrative around who you would like to be introduced to and why.
  • Remember that people want to introduce people who are passionate about what they do. If you’ve served this subset of your client base well, they will want to tell their network and specific individuals about you.

Looking For More?

Mike has made a career out of coaching financial advisors on practice efficiency and building referral strategies. His book and corresponding website may be a good resource for you.

Additionally, feel free to reach out to Blueprint to discuss the practice management services we offer to our financial advisor partners.

Blueprint Investment Partners is an investment adviser registered under the Investment Advisers Act of 1940. Registration as an investment adviser does not imply any level of skill or training. The oral and written communications of an adviser provide you with information about which you determine to hire or retain an adviser. For more information please visit and search for our firm name.

Information obtained from third-party sources is believed to be reliable though its accuracy is not guaranteed, and Blueprint makes no representation or warranty as to the accuracy or completeness of the information, which should not be used as the basis of any investment decision.

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