If you ask most any advisor, consultant or provider of high-value services where their best clients come from, it’s likely you’ll hear, “referrals”.

However, as we know, not all referrals are equal. There are two primary sources for referrals, and while both are worth developing, only one is likely to provide you with consistent streams of the types of new clients you most desire.

Typically referrals come from either existing clients, or from professionals, (often referred to as Centers of Influence-COIs). According to a study conducted by the marketing research firm Prince & Associates, of these two sources, COIs outperformed existing clients both in terms of quality and number of referrals. When one thinks about that, it makes a great deal of sense.

For example, if one is seeking to attract more affluent clients, your current clients will tend to know a relatively small number of qualified and interested clients. However, the right attorney or accountant is in a position to refer you considerable numbers of the precise types of clients you most desire.

Now, this isn’t meant to discourage one from actively seeking referrals from existing clients, but it does shed some perspective on where your marketing efforts might be best utilized. This is particularly true if your goal is to upgrade the quality of the types of clients you take on. In that scenario, relying on client referrals can be highly limiting.

However, for most advisors and consultants it is far easier to rely on referrals from their existing clients, and in many cases this makes up the majority of the overall marketing effort. While that may be suitable for those offering relatively inexpensive services in which “everyone” is theoretically a prospect (such as plumbing or other household services), for those seeking to attract premier clients it’s likely you’ll “lap the track” on who they know relatively quickly.

This is why when one looks at the traits of consultants and advisors who earn in excess of $750,000 per year, one notices that they have almost universally focused on building a select network of COIs.

This all makes perfect sense and on one level is hardly “new news”. While the importance of building relationships with COIs is well understood, the competition is intense. Again, according to a study done by Prince & Associates, attorneys and accountants (just to name two strategic referral sources) averaged 5.1 solicitations every 6 months from someone desiring to do work with their clients.

To make matters worse, most of the time the pitch is mind-numbingly predictable and undifferentiated. Thus it’s of little surprise that all this effort results in very little return. After a few half-hearted attempts, the majority of advisors and consultants simply decide to give up and go back to concentrating on referrals from their existing clients, and continuing making the rounds at various networking events.

So what does it take to build relationships with COIs? Keep these two points in mind.

First, think small numbers. Most referrals programs teach a “spray and pray” approach-try to develop some sort of relationship with as many COIs as possible. Even in the best-case scenario, this only results in very casual affiliate-types of relationships. These may result in an occasional referral on a sporadic basis, but hardly what one wants from a true strategic partnership.

A far better strategy is to focus on deep relationships with a small number of COIs. How many is “small”? According to research done of advisors earning over $750,000 per year, the number never was greater than five. Again, if one thinks of developing true “partnering” relationships, that small number makes perfect sense. Anything above that becomes both unwieldy and unpractical.

The second key element is to approach building strategic partnering relationships with the mindset of COIs as clients. Again, this is intellectually understood, yet often missing in execution. A simple exercise I learned from consultant Brett van Bortel illustrates this.

Take a piece of paper and divide it into two columns. On the left hand side put the initials of one of your best clients-the type of client you wish you had more of.

In the second column put the initials of a professional who has either given you a great referral, someone you’re cultivating as a referral source, or someone you know could provide you with the types of referrals you want.

Now, write down the answers to the following questions for both people:

*What is the name of their spouse?
*What are the names of their children and how old are they?
*Where did they go to college?
*What types of pets do they have?
*How do they make their money?
*What are their interests outside of their jobs?
*What is the best and worst experience they’ve had with people offering your types of services or advice?

Typically, people are able to do a good job answering these questions for their very best client. (If not, that’s a data-point in and of itself.) However, most of the time, people do not do as good a job with the answers when it comes to the referral source. In other words, they are not treating the COI as a client. And as Shakespeare says, “therein lies the rub”.

It’s one thing to intellectually acknowledge that one should cultivate relationships with referrals partners in the same way as you would your best clients, but in reality most consultants and advisors don’t really do so.

This is but one component of the overall marketing strategy for developing strategic partnerships with a select number COIs who can refer you consistent streams of new prospective clients. It’s a topic that I’m working on with many of my coaching clients.

If this is a focus for you, perhaps you should consider Gentle Rain coaching. Additional information in HERE.

Thanks and I look forward to speaking with you soon
Mark
mark@gentlerainmarketing.com
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