A couple of weeks ago, I had a conversation with one of our members who already has a practice that most TaxCoach members would envy. He’s not interested in “growing” his clientele so much as he is in “renovating” it, with more business owners and more financial service business. I’ll call him “Carl,” because that’s not his real name.
Carl hasn’t done a lot of formal marketing over the years. He’s grown primarily through referrals — and he’s done it without ever actually asking for referrals.
Growing through referrals, without actually asking for them, is more common than you might think. We tax professionals tend to do a good job of delivering value to our clients. But we tend not to do such a good job of communicating that value to them. And that poor communication extends to failing to ask for the referrals we deserve!
I’ve done hundreds of new member consultations since Keith and I launched TaxCoach back in 2005. One question I always ask is “what’s your best source of new clients?” The answer is almost always “referrals.”
But… lately I’ve been pulling a bit of a Columbo and asking “just one more thing.” Specifically, I’ll ask “what systems do you have in place to generate those all-important referrals?” And then there’s an uncomfortable silence on the other end of the phone.
There’s another question I like to ask, and it actually goes hand in hand with the first two: “Have you ever sat down with a client and told him exactly what you’re worth to him, in specific dollars and cents?”
And once again, that question usually produces… silence.
Think for a minute about your own clients. If you’re like most TaxCoach members, you’ve grown mainly through referrals. And you’ve done that with very little thought or reason.
Now, imagine how you could grow if you had a system for generating referrals — a system based on communicating your value to clients who may already be referring you without a clue how much you’re worth?
Want the secret formula? Here it is:
1. Make asking for referrals a priority. New York Times columnist Thomas Friedman tells a story that illustrates the issue perfectly:
“There is this very pious Jew named Goldberg who always dreamed of winning the lottery. Every Sabbath, he’d go to synagogue and pray: “God, I have been such a pious Jew all my life. What would be so bad if I won the lottery?’ But the lottery would come and Goldberg wouldn’t win. Week after week, Goldberg would pray to win the lottery, but the lottery would come and Goldberg wouldn’t win. Finally, one Sabbath, Goldberg wails to the heavens and says: ‘God, I have been so pious for so long, what do I have to do to win the lottery?’
And the heavens parted and the voice of God came down: ‘Goldberg, give me a chance! Buy a ticket!'”
If you want more referrals, you have to ask for them. Just get in the habit of asking and you’ll see your own referrals skyrocket, even if you have no idea how best to ask.
2. Tell your client who you want to do business with. One problem with just asking for “referrals” is that it forces your client to open their mental Rolodex and flip through it until they find someone appropriate. (Rolodex? Seriously old school… Keith.) Asking them to do that kind of work makes it easier for them to just shake their head and say “Nope, sorry, can’t think of anyone right now.” So, identify the sort of “A” clients you really want to do business with, and make it easier for your clients to help you with the right referrals.
3. This is the most important part. Always tie your referral request into some immediate and measurable benefit you’ve already delivered to your client.
It’s one thing to take your friend and client Fred The Realtor to lunch at the club and ask him “Do you know anyone I should be talking to?” It’s another thing entirely to take him to lunch at the club, remind him how you saved him $15,000 over the last three years by helping him establish an S-corp, and say, “Who else in your office does a pretty good business and would be interested in that same savings?”
Tying your request to an immediate and measurable benefit accomplishes two goals. First, it gives your client a better reason to refer you than just general goodwill. And second, it means you can ask for the referral without really asking for the client to do you a favor. You’re positioning it as a chance for Fred to do a favor for the guy he ultimately ends up referring! (One member told us he got 18 names from a single client with this technique!)
4. Extra Credit: When Fred gives you a name, you say “Thanks, and who else?” Then shut your mouth! If your client can think of one person who wants whatever immediate and measurable benefit you’re citing, he can probably think of three more. Asking him to think of more — and keeping your mouth shut while he does it — turns ordinary referrals into power referrals and turbocharges your growth.
I realize we’ve covered a lot of this material before in all sorts of places. But asking for referrals has such power to transform your business, it really is worth covering again and again. It’s the single most powerful business development tool in your arsenal, and it deserves far more attention than most of us give it.