New Research: The Unexpected Variable that Leads to Referrals

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

Dan Richards

Few topics get as much attention as the best way to increase referrals. Some of the ideas I’ve heard include coaching clients to better understand and communicate your value, becoming the safe choice in a targeted niche and creating “raving fans” by delivering an outstanding client experience. Depending on what you read and who you believe, each of these is the key to increased referrals.

None of these are what truly drives referrals.

New research shows that the variable that most influences referrals is something that almost never gets mentioned –the going-in predisposition and mindset by clients— what can be called a client’s ”referral DNA.”

In this column, I outline the research that identified referral DNA as a key variable and the implications for advisors.

How to win multi-million dollar clients

Dan Richards

Tired of ho-hum conference speakers? Dan Richards delivers leading edge keynote talks on what it takes to attract high end clients today.

To energize your next conference, click for more information on Dan's speaking topics and to hear from past clients.

Dan Richards


6 Adelaide Street E, Suite 400

Toronto ON M5C 1T6

(416) 900-0968

Taking an evidence-based approach

Historically, the evidence around creating satisfied clients and increasing referrals has been informal and anecdotal rather than rigorous and fact-based. To help address that, I worked with a faculty member in the MBA program at the University of Toronto (where I’ve taught for over 20 years) to design a research study to measure what drives client satisfaction and as part of that what leads to referrals.

Fifty advisors from a variety of firms volunteered to participate in this study. Over a six-week period in the spring of 2012, at the conclusion of face-to-face meetings, participating advisors asked clients to complete a confidential, in-depth written questionnaire about the meeting that had just occurred as well as an assessment of their advisor; a draw for a $5,000 among all respondents was the motivation to participate. To encourage candor, clients did not return the survey to their advisor but were given postage-paid envelopes in which to mail the completed questionnaire. While the clients were completing the written survey, the advisor went online and completed a parallel survey about their perceptions of the meeting.

More than 500 investors returned completed questionnaires. One of the questions in the survey related to the number of times that the client had recommended friends or family to their advisor in the past two years. Clients fell into three categories:

Had recommended advisor two or more times


Had recommended advisor once


Had not recommended advisor