As a financial advisor in an institution, you likely joined with the expectation of leveraging the institution’s relationships to generate referrals. But as you quickly learn, referrals don’t just fall into your lap; you have to build trust, maintain visibility, and put in the work to establish a solid referral pipeline. To help you, here are five key steps you can take to improve your referral program:
Start by building a solid foundation. Every person involved in your referral program needs to clearly understand their role. Whether they’re branch employees or managers, assigning responsibilities ensures they know what’s expected of them. By defining roles and responsibilities upfront, you’ll be setting up a system where everyone takes ownership, leading to stronger referral outcomes.
Once you start receiving referrals, treat them as the valuable leads they are. Follow up promptly, and understand that getting in touch with the referral might take multiple attempts. Referrals won’t always expect to hear from you right away, but they trust the person who referred them—so don’t drop the ball.
To keep your referral program thriving, it’s important to continuously train your referral sources. Make sure your branch employees are well-equipped to recognize situations where a financial advisor’s services would benefit a client. They interact with clients daily and can easily spot life events or moments where your expertise is needed.
Provide consistent, short training sessions during branch meetings, covering topics such as the Rule of 72 or the power of tax deferral. When you train them on these key financial concepts, it helps them understand your value and improves their confidence in making referrals. Additionally, offer them examples of how past referrals led to successful meetings. When employees see their colleagues being recognized for great referrals, they’re motivated to follow suit.
To improve, you need to track your results. Develop a system to monitor the number of referrals you receive, how many convert into meetings, and how many of those meetings lead to new clients. This allows you to identify areas where you can enhance your process.
Tracking these metrics also helps maintain accountability. Many institutions offer incentives to employees for qualified referrals, so it’s crucial to ensure that you’re tracking kept meetings and sharing this data with the referring employees. Not only will this help you boost your conversion rates, but it will also strengthen your relationships with referrers.
Effective communication is vital. Once you’ve received a referral, make it a point to keep your referral sources updated on its progress. Regular communication builds trust and strengthens your referral relationships. Imagine this: A branch employee makes a great referral, and you successfully convert that referral into a client. If the employee who made the referral doesn’t hear back from you, they’re left in the dark—and potentially frustrated if there was an incentive at stake.
By sharing updates with your referral sources, you not only keep them in the loop but also help motivate them to send more referrals your way. Set up quarterly meetings with branch managers to review referral performance and discuss ways to improve. Create a simple agenda covering the number of referrals received, meetings scheduled, and new clients gained. Consistent reporting builds confidence in your program and reinforces the value you bring to their efforts.
The ultimate goal of any referral program is to convert referrals into long-term clients. But to truly optimize your process, you need to analyze the results continuously. Are you meeting with 50%, 60%, or even 70% of your referrals? How many of those meetings result in new clients, and what percentage of those assets come from within the institution versus outside?
Once you know these numbers, you can pinpoint areas where you can improve—whether that’s by increasing your closing ratio, refining your follow-up process, or optimizing training efforts. Automation can also help streamline this process, giving you access to detailed reports that track every step of your referral program and allowing you to focus on improving results.
The foundation of a strong referral program lies in consistency. Be visible, be proactive, and maintain regular contact with your referral sources. Train them, track your results, and report your progress, all while looking for ways to improve. By focusing on structure, training, tracking, reporting, and delivering results, you’ll not only grow your referral program but also strengthen your relationship with the institution, its branches, and, most importantly, your clients.
If you’d like to assess your program’s strengths and areas for improvement, consider taking our Referral Program Quiz or learn more about how automation tools like ReferTrac can streamline your investment referral process.