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April Is National Financial Literacy Month

When should you a ask a prospect for referrals—on the first appointment, on the second or a year into the relationship? It depends. When determining the right time to ask for referrals, consider that value must be provided and recognized by both the prospects and clients. You also must consider the personality of the referral-giving candidate.

Not too long ago, an insurance agent called to book an appointment with me. As we were about to hang up, he mentioned that he built his practice on referrals and that at the end of our first meeting he planned to ask me for referrals, saying, "Perhaps you could be thinking of some folks between now and our appointment." Was I ready for this aggressive approach? No! This is old-style referral gathering, and it creates more bad will than good referrals. I might give him a referral or two, but not very good ones.

The importance of value

Your prospects or clients will tell you when they value your work. They'll say things like, "I'm glad I finally started working with you on this. I should have done this 20 years ago." That’s it—your value has been recognized. This is the time to ask for referrals, not before.

After your value has been recognized, all you have to say is, "I’m glad you’re pleased and I’m glad you’re seeing the value of the work we’re doing. I was wondering if we could brainstorm for a few minutes to identify who else we can bring this valuable process to. Can we try this for a minute?" Make the process about working together.

It is absolutely possible to provide referral-giving value on the first appointment with a prospect. In fact, I hope you do. Don’t be there just to sell. Be there to educate, ask questions and unveil the client’s needs, values and concerns. You’ll earn their trust as you learn their story. Then tell your story, and move on toward the sale.

Assessing value

I strongly encourage you to embrace the habit of asking value-seeking questions. At the end of your first appointment ask your prospect, "Bob, of all the things we talked about today, what do you find most important?" Or say, "We’ve been through a process over the last two meetings. What’s been the most valuable part of that process?" In most cases, such questions will yield a conversation that demonstrates that value has been given and recognized.

On occasion you’ll hear something like, "I’m not sure what the value is yet." You will want to know this before the end of the appointment, so you can address the problem right away.

Personality styles

It is important to consider a person’s personality and communication style when asking him for referrals. People with an open personality style are much more willing to let you into their lives than guarded folks. They are, therefore, more likely to let you into the lives of others more quickly than guarded folks. So, you can (and should) ask open people sooner into the relationship. Guarded people can be great sources of referrals, but they just need a little more time to trust you. Plus, they like to be in more control of the process than the open types.

Ask value-seeking questions. If value has been delivered and recognized, and you feel the referral candidate likes and trusts you, then it's time to ask for referrals. The worst thing they can say is "no."

Bottom line, when your prospect or client lets you know that value has been received, it’s time to ask for permission to engage in the referral process—not just to help you, but to see who you can help together.

By Bill Cates, CSP, CPAE


Bill Cates is president of Referral Coach International and the author of "Get More Referrals Now!" and "Don’t Keep Me a Secret!" To learn about his free newsletter, boot camps, coaching program, video training program and more, visit www.referralcoach.com. Cates can be reached at info@referralcoach.com or 301-497-2200.



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