Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.Dan Richards

Advisors often ask me what should be the right frequency with which to raise referrals with clients.

Some advisors are hesitant to introduce the topic of referrals at all.  Balancing that reluctance, one advisor told me about a direct connection between how frequently he talks to clients about referrals and the chances that referrals will follow as a result – the more often he raises this, the more often referrals will follow.

While true to a point, there are obvious cases of going too far.

For example, suppose you raise the subject of referrals on the phone with a client in the morning.

If you believe that advisors should always ask for referrals, then if you happen to speak to that same client the next day, you should say “Since we spoke last, have you run into anyone I should be talking to?”

Few advisors would take the idea of always asking for referrals to this extreme – but the question still persists about the right frequency with which to raise referrals.

Quality over quantity

The key is to strike the right balance – to bring up referrals often enough to keep them top of mind, but not so often that you undermine your image of professionalism or have clients feel you’re hounding them. While the “more the merrier” approach applies to some aspects of the advisor-client relationship – it’s not true of referrals. Yes, you want to let clients know you’re open for business, but bringing this up too often will backfire.

The reason is quite simple. Clients provide referrals to help their friends, not their advisors. And if referral conversations becomes a recurring part of every conversation, you risk being seen as a pest rather than someone committed to helping clients achieve their goals and as operating from your agenda, not your clients’.

As a result, the focus of referral conversations needs to be quality, not quantity. For example, throw away reminders that you’re open for business have marginal benefit.  As a general rule, strive for a three-minute conversation about the specific attributes of the clients that you work with best. That actually engages clients (and is, in fact, a conversation) and is far more effective than any number of casual reminders that “referrals are welcomed.”

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