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48 Embrace the Debate: Referrals Revisited

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Embrace the Debate: Referrals Revisited

Kurt Dupuis:
Welcome to The Whole Truth, where two wholesalers help financial professionals build great practices and thrive in a rapidly changing industry. We'll bring you the stories and voices from those on the front lines of this change and we'll have some fun along the way.

Steve Seid:
This is more than a podcast. We're building a community of financial professionals who are growing, forward-thinking and want to get better. Thanks for listening and contributing to the discussion.

Disclosure:
The views expressed herein are those of the participants and not those of Touchstone Investments.

Steve Seid:
And welcome everybody to The Whole Truth from the Bay Area, California. I am Steve Seid.

Kurt Dupuis:
And from Atlanta, Georgia. I am Kurt Dupuis. So Seid, we're both prone to obsessions. Is that... That's a slight way. My current obsession is... This is probably a definition of an obsession because I can't even explain how or why I decided to do this, but I just got it in my head that I wanted to do a triathlon. So...

Steve Seid:
I love how you set that up. You're just like, "One day it just popped in my head I need to do..." Which is a pretty cool thing. Yeah.

Kurt Dupuis:
It's a very... Welcome to my brain. It's one of those things where a thought from the back of my brain somehow works its way to the front of my brain. And-

Steve Seid:
I wish our listeners could see how you're using your hands in this. Where he's got his hands behind his head. Go ahead, sorry.

Kurt Dupuis:
But no, it's something I've wanted to do for a while. I ran a marathon in Pittsburgh in 2010 and I did a couple half marathons after that. It's just given me something to work towards and obsess over. And I'm also a social creature, so I have strong-armed a few of my neighbor friends to do it with me-

Steve Seid:
Of course you have.

Kurt Dupuis:
So we got a pack, of them do it.

Steve Seid:
Refresh my memory. So triathlon, what are the... I know there's three, right? Tri. What are the three things you have to do and then how long for each of those? I forget.

Kurt Dupuis:
It's swimming, biking, running. This one will be a 400-meter swim, which is eight, there and back in a pool or 16 lengths. I think it's a 14 or 14 point something mile bike ride and then a 5K run, so 3.2 miles.

Steve Seid:
Okay. So probably the hardest thing is the swimming out of that I would imagine, right? Or am I wrong in that?

Kurt Dupuis:
400 meters is pretty short, especially if you just take…

Steve Seid:
Is it?

Kurt Dupuis:
…a modest pace. And I've been riding the bike. Honestly, I think running's going to be the toughest part. Not only is it last, but I don't enjoy running.

Steve Seid:
Three miles, though? I feel like three miles ain't crazy.

Kurt Dupuis:
No it's not. None of it's crazy, that's why... But you can start stacking these things and…

Steve Seid:
And then it becomes really difficult.

Kurt Dupuis:
…even modest work becomes real effort. Yeah.

Steve Seid:
I remember I did a half marathon once and I finished it. It was in Tennessee. And I thought to myself, "People do twice this amount, two times." That was my thought was, "How?" I'm not built to run that long. I'm not a runner. I don't have a runner's makeup.

Kurt Dupuis:
No one is, that's the thing. What a marathon is based off of is Greek mythology. The dude died at the end. Why are people doing this to themselves? 

Steve Seid:
Is that right?

Kurt Dupuis:
It makes no sense. Yes.

Steve Seid:
That's what-

Kurt Dupuis:
He ran-

Steve Seid:
That's the origin of this?

Kurt Dupuis:
… he carried this message. And it was... It's 26.2 miles-ish and…

Steve Seid:
I didn't even know this.

Kurt Dupuis:
…delivered his message and then he croaks at the end.

Steve Seid:
Everything goes back to the Greeks. I swear to God. Everything goes back to them. They're literally the basis of... Almost everything that we do goes back to the Greeks. It's kind of amazing.

Kurt Dupuis:
Important part of human history.

Steve Seid:
So let's get into the episode today. We have two of our colleagues, Mindy Burgess, who handles the Pacific Northwest, Jason Zawalich, many of you will know him from my territories, the hybrid who covers Northern California. They wanted to come on and talk a little bit about referrals/business development. Because it was kind of interesting, Kurt, we said, "Hey, come on and do a referral episode." Because we had this discussion about it. And they started that way, but then they sort of veered into business development. It was an interesting conversation. So I think what our audience will come away with is a nice few takeaways about referrals and ways to get better in that area. They did a fun debate over that. But also some cool business development ideas, and who doesn't need that?

Kurt Dupuis:
Yeah, it's got a fun “embrace debate” structure where they both take opposing views of the referral conversation. Do you ask or do you not ask and just let them come to you? So they dig into some of that, which is always fun.
So we'll get right into our episode with Jason and Mindy. Stick with us and if you haven't already, make sure you hit subscribe. Any questions, comments, or criticism, send them to thewholetruth@touchstonefunds.com.
And without further ado, here's a conversation about referrals.

Jason Zawalich:
All right, well welcome to The Whole Truth podcast. I'm Jason Zawalich and I'm joined by my co-host today, Mindy Burgess. Steve and Kurt, were nice or foolish enough to allow us to come on and host a show today and we're both really excited about it.
So how you doing today, Mindy?

Mindy Burgess:
I'm doing well. How are you J.Z.?

Jason Zawalich:
I'm doing good. I'm doing good. For those who don't know who I am, I'm Jason Zawalich. I've been working at Touchstone for four years, the whole time in the Northern California territory. I'm now a hybrid wholesaler helping Steve cover Northern California. And Mindy, you want to give yourself a quick intro so people know who you are?

Mindy Burgess:
Yeah. I am the external covering the Pacific Northwest. So cover the states of Washington, Oregon, Idaho, Montana, and Alaska. I've been with Touchstone about six years.

Jason Zawalich:
Our focus for our episode today is going to be referrals and how to generate them. So hopefully we'll be able to provide you guys with some good ideas that'll be useful and get your creative juices flowing and generate some more referrals for your business.
The first thing we're going to talk about is asking. Anytime the topic of referrals comes up or you Google how to generate referrals, the first thing that comes up is going to be to ask. Just ask for those referrals, right? That's not always easy or comfortable. For those of you who are regular listeners to the show, you may recall a couple of guests that came on and tackled the subject of asking for referrals. Julie Littlechild was on the episode “Closing the Referral Gap”, and she advocated for asking for those referrals while the episode “Stop Asking for Referrals”, featured Penny Phillips where she said to stop asking for referrals, with a caveat.
So I thought we'd take maybe a quick second to talk about whether you should or should not be asking. So Mindy, to ask or not to ask, where do you stand?

Mindy Burgess:
I'm going to have to agree with Julie on this and take the stand of asking for referrals. So first wanted to play a small clip of that interview so you can hear from her.

Kurt Dupuis:
What do you think is one of the more misunderstood myths that financial professionals think when it comes to referrals?

Julie Littlechild:
There are a few myths and they all get in the way of us actually tapping into the opportunity that's out there. I think it's huge. I think that we're sitting on this absolute mountain of untapped referral potential right now. And maybe the simplest one, which gets to the core is that we actually need more clients to refer. And the reason I say that that's such a big one is because if we believe that we need more clients to refer, that triggers a whole set of activities. How do I ask? What do I say? What do I do? What we've certainly seen in the research is that advisors are getting more referrals than they would ever need. They're just not translating into introductions.

Mindy Burgess:
So she goes on to explain that 42% of clients have said that they've referred family or friends, but advisors say that only four to 5% of their clients have given them referrals. That's a huge difference. Clients might mention to a friend or relative or coworker, "Oh, my advisor's really great." Something generic. And then the advisor is not aware of this, so there's no follow up. And we're in sales. We can never expect clients to call us. We need to be the ones to call.
So it's really important to ask your clients, "Have you referred anyone? And what were those circumstances? What did you think that I could help with?" And what this leads to is how you can articulate your value. It's really important to make that a specific story rather than facts. Stories are a lot easier for people to remember and to reiterate. If you can get specific with one story, it's a lot more impactful.
You definitely want to talk to your clients about this, make sure that they're aware of your personal value proposition. But I was also thinking about it, I read the “About Me” section on advisors websites every day and usually they're all pretty much the same. "I live with my wife and three kids in Bellevue. On the weekends, I like to go skiing and camping and I'm a part of this organization in this church." Which is great and that's really good information to have on there, but add in a specific event that you've helped a client with.
So a specific life event, a death in the family, a new marriage, a sick client, some kind of struggles that a client's had. That way when one of your clients has a relative or a coworker going through a similar life event, that's something that they can easily remember and reiterate to that person. And then you can go back to your clients, make sure that they know your personal value proposition, that story, and ask them, "Do you know anyone that's going through a life event like this? Because here's how I’ve helped."

Jason Zawalich:
I'm going to take a different approach on this. I'm going to agree with Penny Phillips, who I mentioned had come on previously and asked listeners to stop asking for referrals.

Penny Phillips:
If you really are a really, really good advisor, if you really have EQ, high EQ, every engagement is so obsessively focused on the client, what they want, what they need... Each conversation. And I tell advisors, "Go into conversations with clients. Before you go in, ask yourself the question of 'what is this person trying to achieve in this conversation and what do they need from me?'" Those are two coaching questions, by the way.
And you could use that tactic with a spouse or a partner if you're in an argument or having a difficult discussion, ask yourself, "How can I be most helpful in this conversation?" When you act like that with a client, trust me, you will never have to ask for a referral again. You will never have to. And that is the truth. And we don't say that enough to advisors candidly, because firms don't want to spend money on EQ training and practice management.
If we train the entire industry on that obsessive active listening, you would never have to ask for a referral. So what I say to advisors is "Create referable experiences, number one, you know - first and foremost, but switch your way of thinking about it." So if you ask me, "Should we be asking for referrals from every client?" My answer is no.

Jason Zawalich:
Now Penny does go on to talk about a certain subset of people who are natural connectors, but they probably make up a really small percentage of your clients. So just not stop asking everybody for referrals, but you really need to only ask the people that are those natural connectors. You know those people. The people that always have a guy. Those people, if approached the right way, can be a great referral source for you and your business.
But I would encourage you to listen to more of Penny's interview because her main point was, and one that I agree with, is the best way to grow your business and to get referrals is to do a really good job with your existing clients. If you're providing exceptional service to your existing clients, you really won't have to worry about asking for referrals as much. They’re going to want to refer you because of that. And just giving them the best experience you possibly can and not worry about asking them to generate new business for you.

Mindy Burgess:
And also kind of goes into the client segmentation again and making sure that you have that service model in place for your clients.

Jason Zawalich:
Absolutely. We do this all the time. Client segmentation, building a proactive client service model so you are servicing those clients to the best of your abilities. I think that really is the best way to get referrals and to grow your business.

Mindy Burgess:
Yeah, and another thing that I agree with her on, she talks about how important listening is.

Jason Zawalich:
Mm hmm.

Mindy Burgess:
It's so easy to be the one talking and giving information, but to really listen to people and actually understand what they need, what they want, is huge. And people know if you're actually listening to them.

Jason Zawalich:
Okay, so we've talked about asking for referrals, but we wanted to come on and give you a few different ideas to help you hopefully generate some more referrals in the future without just straight up asking your clients for names of friends and family. So we'll do a little back and forth here.
So Mindy, why don't you start?

Mindy Burgess:
Yeah, so I was talking to one of my advisors in Alaska and he was talking to me about his struggles with generating new business, growing his business, getting clients. So I asked him, "Well, what type of clients are you looking for? What is your niche?" And he said he didn't really have one was trying to figure that out. So that started a really long and good conversation.
It was interesting because I'm so used to, in Seattle, it's so easy to find a niche. You could be an expert in different retirement plans for Microsoft or Amazon or Boeing. In Portland, I have advisors, their niche are Nike employees. But without those big companies in Alaska, we're talking about what else could you look for?
He had mentioned, "Well, what about attorneys?" So I did some digging on this and I learned that you can go to your state bar website. So for example, for him it would be alaskabar.org or in California for you it's like Calbar.org and you can sign up to offer CLE credit, so continuing learning education credit.
And it's really easy. On the website up at the very top, there's a tab where you click on CLE and then you click on applying for CLE credit and it's just a one page form, you would fill out your topic. So it could be on estate planning or SEP IRAs or retirement planning for self-employed attorneys or updates on financial laws. You upload your presentation and then you get put onto the calendar for offering CLE credit.
So when an attorney in that state needs their CLE credit, they go to that calendar. You can say, "Hey, come stop in. I'll have free coffee and donuts. Get your hour of CLE credit. That way you can meet those people face to face. You can get their contact information, learn a little bit about them, figure out why did they choose one on estate planning versus SEP IRAs. Get to know them a little bit better and that way you have that contact information.

Jason Zawalich:
No, I love that idea.

Mindy Burgess:
Yeah. Another one I thought of was landlords. So how to get a list of landlords in your area. You can go to your Secretary of State's website, go to business filings and do a property record search and then search for multi-unit buildings and then contact them directly to invite them to your client events.

Jason Zawalich:
I really like the idea with the lawyers and the CE. We know how important CE is and how often you have to do it. When you can offer CE. It's a really big draw and I've never heard of an advisor doing that for lawyers. That's a really good idea.
Another one you can do is, how about start a blog or a podcast, right? We are on a podcast.

Mindy Burgess:
Yeah.

Jason Zawalich:
…and it's a great idea to get some of your content out and a few of these ideas I have are centered around creating content that your clients can share with friends, family, without directly asking for their referrals. So it's a way for them to share information that you're providing without asking them to do so.
But they also have another benefit which is going to be generating referral traffic. So what is referral traffic? When someone comes to your website from sites other than the major search engines like Google, places like Google and other search engines consider these links and these social signals as positive ranking factors when coming from trusted websites.
I read a great blog on HubSpot on this topic and I think it's worth checking out if you are interested in generating some more referral traffic to your website and to your business. But beyond getting people to your website, a blog or a podcast, it's an easy way to get you and your ideas in front of new people by way of your customers. Your client may read a blog or they may hear your podcast and they're going to think about a conversation that they had with one of their friends recently and they may forward it over to them, which in turn can lead them to check out more of your blogs, more of your podcast.

Mindy Burgess:
Right, and that can definitely go along with personal value proposition and heading into those stories of how specifically you've helped clients and can help other people in similar life situations.

Jason Zawalich:
Did you have any other ideas or did you shoot them all off there?

Mindy Burgess:
One last thing. At…

Jason Zawalich:
Yeah.

Mindy Burgess:
…different client events to have little gifts or handouts with your contact information on it. And I really think if you think about weddings and party favors, usually the best party favors or gifts to get are perishable items. So think food, plants, something as simple and inexpensive as a bag of popcorn.

Jason Zawalich:
Email marketing. Another way, I'm not going to go too much into this because it is similar to what I'm talking about right now, but the thing I want to point out is everybody consumes information differently. I can say for myself, I like to read things like I'm not going to watch the five minute video from whatever news source. I'd rather just read the article myself. And I think that's true across all these things. So the people that maybe won't check out your social media or they're not going to listen to your podcast, maybe an email is going to be good for them.
And it's the same kind of content. So you don't have to keep creating new content, you know can write something about social security. Maybe you write a blog about social security. You can make the podcast about social security, same content. You can put that in an email, it's going to be the same content. Or you can make a video that people can watch.
Then the last one's going to be an incentive program. I'm sure some people do this already, but some of the ideas around this one could potentially run afoul of compliance rules. So always check with compliance first before you do any incentive programs or listen to me on this podcast about this. Check with compliance first to make sure what you're able to do. But I think the easiest incentive program to offer people is going to be discounts or fee reductions. I'm sure a lot of people already do this, but tell your clients you're offering a complimentary financial review to any individual they refer to you and then you can offer a discount on the services you provide them if it's a successful referral. And the things that I read said even a 5% discount on their fee for a year can be enough incentive to have your clients refer you to somebody and bring you some new business. So a 5% discount…

Mindy Burgess:
I love all these. It's a lot to think about. A lot of good ideas. That's great.

Jason Zawalich:
All right, so that's it. Appreciate you guys listening. We appreciate Steve and Kurt having us on.

Mindy Burgess:
Yes, thanks so much guys, and thanks everyone for listening.

Jason Zawalich:
Thanks for listening.

Steve Seid:
Thanks to Jason and Mindy for a great conversation. We're going to move on to our Costanza Corner. This is The Whole Truth. Stick with us.
And welcome back to our Costanza Corner where we like to end on a high note. Kurt, you're up.

Kurt Dupuis:
Well, this is a pretty easy one because we're recording this in September and today happens to be my anniversary. So...

Steve Seid:
Congrats brother.

Kurt Dupuis:
Nine years married to this lovely lady. And I'm really excited what we're doing, since kids and our oldest is seven, so it's been a while. We haven't had a lot of getaway weekends, and so kids are at a better age. We got some grandparents coming and watch the kiddos, so we're getting away.

Steve Seid:
Oh, that's great.

Kurt Dupuis:
But rather than going somewhere, we're doing a “stay-a-versary”, is that a word?

Steve Seid:
I think it is now.

Kurt Dupuis:
We met in Pittsburgh, we got married in Pittsburgh and we were both single at the time. So I feel like we discovered and explored that city very well over the seven, eight years that we were there. But then when we moved to Atlanta, we bought a house and had a kid within 30 days of each other of moving to Atlanta. So our experience in Atlanta has not been like it was in Pittsburgh. There's all kinds of cool stuff that we haven't had the chance to explore. So we're going to check some of those things off the box. So we're got a hotel in Midtown. We're going to go to a couple of nice restaurants that have been on the list for a while. Going to go see a comedy show, just...

Steve Seid:
That's awesome.

Kurt Dupuis:
Just do Atlanta stuff.

Steve Seid:
Great thought. I'm nine years too, so I can't believe we got married right around the exact same time.

Kurt Dupuis:
There you go.

Steve Seid:
There are women that has actually stayed with us almost 10 years. Next year will be 10 years-

Kurt Dupuis:
Tough to believe.

Steve Seid:
…which I just got to give Becky a lot of credit for this. You know what I mean?

Kurt Dupuis:
Yeah. Thoughts and prayers to her.

Steve Seid:
Congrats buddy. Thanks everyone for listening. We'll see you next time.

Kurt Dupuis:
See y'all.

You can find The Whole Truth and subscribe for free on Apple Podcasts, Spotify, or your favorite podcast app. We'd love it if you took the time to rate and review the show on Apple Podcasts. It helps others find the show. And for more episodes of The Whole Truth, go to www.touchstoneinvestments.com/thewholetruth. That's touchstoneinvestments.com/thewholetruth, all one word.

Disclosure:
Please note that this content was created as of the specific date indicated and reflects views as of that date. It will be kept solely for historical purposes and opinions may change without notice in reacting to shifting economic, market, business, and other conditions. Touchstone funds are distributed by Touchstone Securities Inc., a registered broker dealer and member FINRA and SIPC.