You have two choices when an existing client recommends you to someone unsuitable for your services. You can either grumble in frustration or seize the opportunity to enhance your reputation and improve the quality of future recommendations.
89% of advisers and planners believe that recommendations from existing clients are the best source of enquiries. And 95% want more of them. Yet, there will always be times when a client recommends you to someone who isn’t the right fit.
So, what should you do when that happens?
Here are three ways of turning wrong-fit referrals into something positive.
Only 20% of advisers/planners do the first, most do the second, and I don’t know anyone who does the third.
1. Thank the client who made the original referral
Gratitude is a powerful tool, yet many advisers/planners miss the opportunity to express it adequately when receiving a referral. So, the first step is simple: thank the client who made the introduction by sending a handwritten card.
A few weeks ago, we explained why doing this stands out and how it harnesses the power of effort bias, which means people value things more when they see that effort has been put into them.
When did you last receive a handwritten letter or card through the post? Exactly.
Your client’s effort in making the recommendation needs to be appreciated. You should send the card as soon as you receive the referral/recommendation, even if that’s before you’ve had a chance to assess whether the person referred is a good fit for your services.
2. Make sure the person recommended feels heard
Even if you know from the initial contact that the referral isn’t a good match for your services, you must treat the person with respect and empathy by:
- Responding promptly
- Listening to them so they feel heard
- Explaining clearly why you’re not right for them
- Offering guidance where it’s appropriate for you to do so
- Opening your little black book and signposting them to an alternative adviser or recommending a directory such as VouchedFor or MoneyHelper.
How you treat someone in this situation reflects on you and the client who referred you, so they must leave the interaction feeling respected and supported.
Give them some time, be helpful, and never be a dead end.
3. Provide feedback to the existing client
A successful referral and recommendation strategy is built on two things:
- Educating your clients about who you’d like them to recommend you to
- Showing appreciation when they do.
When you receive a referral that’s not a good fit, it’s an excellent opportunity to give constructive feedback to the client who made the introduction. Of course, before doing so, you should seek the referred individual’s permission.
Once you have the go-ahead, pick up the phone and call the client who made the referral. During the conversation, explain two things:
- Who your ideal client is, and why you weren’t suitable for the person who they introduced to you
- How you helped the person they referred, such as recommending them to a trusted adviser more appropriate for their needs.
Doing this educates your clients about who they should refer you to in future. You’ll also enhance your reputation because you’ve taken the time to help someone they care about without financial gain.
This act of goodwill taps into the power of reciprocity. When people see you going out of your way to help without expecting anything in return, they’re more likely to recommend you again. And because you’ve explained who your ideal client is, the chances of the next referral being a better-fit increase significantly.
It’s never a dead end
When you receive a referral that’s not right for your business, it’s not a dead end for you, your client, or the person they introduced you to.
Instead, it’s an opportunity for all three of you:
- The person recommended has received the help they need
- Your client will understand better who they should recommend you to
- You’ve done a good thing while enhancing your reputation with your client and the person they recommended.
That’s three big wins.
