The Ultimate CPA Practice Propulsion Machine -- Referral Systems
If you're a lawyer, CPA or business consultant, it’s a good bet that a large percentage of your new clients are coming from direct or indirect referrals. Most of you think of this as "word of mouth advertising."
I’m also willing to bet that 99.9 percent of you out there have never given any thought to putting formal, aggressive and automatic referral systems in place.
When I bring this up with clients I usually hear something like this:
"I don’t need any help with referrals. All of my business comes from word of mouth right now. That’s the only way we grow our practice around here."
Let’s do a quick reality check
Here’s a short quiz that you can use to rate your "real" referral effectiveness. Print this page out and write your answers in the space provided (Please be honest with yourself!)
- How many existing clients do you have? _______
- How many existing prospects do you have in your pipeline right now? _______
- Write your TOTAL of 1 and 2 here. _______
- In the last 12 months how many referrals have you asked for from your existing clients? _______
- In the last 12 months how many referrals have you asked for from your existing prospects? _______
- Write the TOTAL of 4 and 5 here. _______
- If the number on line 3 is greater than the number on line 6, you are truly a referral expert and don't need to read the rest of this article.
- If the number on line 6 is greater than the number on line 3, you are leaving an awful lot of money on the table simply because your referral program is non-existent (let's be honest here.)
The ultimate business building tool is a practice that has become a referral machine.
If you're not getting a constant stream of referrals from your existing clients every week and every month, you're missing out on the most profitable and low cost business building tool in the world.
Your long term success as a CPA, lawyer or business consultant, absolutely depends on your ability to cultivate relationships with your existing clients so that they give you referrals constantly.
There are three reasons why you aren't getting enough referrals:
- You don't know how to ask for referrals.
- You do not have "auto pilot" systems in place to generate referrals WITHOUT having to directly ask for them, and
- Your current clients are too busy with their own lives to think about who might be a good client for you.
The simple solution to these three problems is the installation of a referral system with the following four characteristics:
- The system will run on autopilot.
- They allow you to "target" the niche networks that your clients already operate in.
- They work across a broad spectrum of niche markets.
- They use incentives (not usually monetary) to motivate your clients to refer often.
Before you jump all over this simple concept, you've got to ask yourself one question first: "Am I referable?"
You may think you're running a great professional practice, but be honest with yourself. Is your practice really structured to attract the kind of quality clientele that you'd like to have five years from now?
Where are you going to be in five years?
Look at your offices, service, knowledge base, client service policies, etc. Can you improve things and what should you improve? If you're going after Donald Trump as a client and your office is above a laundromat in the poorest neighborhood in New York, you have an "image disconnect." Correct as many of these "image disconnects" as possible to align yourself with what your target market expects of their service providers. You get the idea.
After you've made sure that you're worthy of referrals, the next thing you have to do is to devise simple systems that automatically "ask" your client for referrals.
It's been said that everyone knows approximately 250 other people and that statistics show that most people associate with other people who are within 10 percent of their own income levels and wealth position in life.
Now think about this. If you know just on millionaire, chances are you've got a connection into a group of 250 other millionaires! If you could just get ten millionaires (or business owners or whatever the "target is) to refer just 10 percent of their personal network to you next month, you'd have 250 new "millionaire" referral leads.
To get these referrals, you need to reward people. I'm NOT talking about money here. Money is usually a poor long term motivator of people. What you can and should do is offer a combination of:
- Some type of reward program--such as dinner for two at the best restaurant in town for every referral that becomes a client.
- Some type of personal recognition program -- such as a write-up about the client who gave you the most referrals last month, in your monthly newsletter (you do have a monthly client newsletter right?)
The more reward and the more recognition...the more referrals you'll get. It's simple human nature.
A simple referral system
There are numerous autopilot systems that you can put together for referral generation and we just don't have the space to discuss them all here, but here's a simple and easy referral system you can implement right away.
Contact a local charity and offer to do some work gratis for them in your area of expertise. In return, they will allow you to do a mailing to their list of donors, offering your services. The charity will also enclose an endorsement letter for your services since they've experienced the "great work" that you can do, first hand.
This one technique alone can give you access to thousands (depending on the size of the charity) of new potential clients, literally overnight, and at no cost to you (other than the time you have put into the project.)
The key is to start thinking "referrals, referrals, referrals." To get more referrals, you've got to ask more often and you have to make it easy for your clients to give you referrals.
Start small and simply ask each and everyone of your clients for a referral to a person who is "just like them."
Do it consistently and you'll see a massive increase in your client list in a few short months.
Best of luck in your own referral program efforts.
Writen by Patrick McEvoy
Rain Maker Best Practices
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