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Developing a high-quality client base is a challenge all advisors face. While almost everyone knows that asking for referrals is an important way to grow a business, many planners struggle to do so.
Why is it so difficult to ask for referrals? In part, it’s because of the many barriers we erect for ourselves, which limit our referral-generating power.
As most of you know, I started my career in financial services, working in a life insurance company straight out of college, then moving to a life insurance agency. It was the year 2000, when the hot product was variable universal life insurance. You know the pitch: Buy life insurance, and invest the cash value in the stock market.
Back then, the only way to get started was to prospect, whether by cold-calling or walking the streets and knocking on doors of small businesses. In my office there were some lifers who built their whole careers knocking on the doors of people’s homes — the proverbial door-to-door insurance salesmen of the 1960s and ‘70s. But even back then, the goal was to secure some good clients and then ask those clients for referrals, prospecting your way forward from a solid baseline.
Compared to cold-calling and cold-knocking, asking for referrals may seem like a pretty sensible, efficient way to grow your business. But I couldn’t bring myself to ask clients and prospects if they knew anyone else who might benefit from our company’s products and services. It was what I was trained to say, and I couldn’t do it.
Deep down, I think the reason why is because I wasn’t proud of the company and the products that I represented. At the time, it really felt like my branch was solely focused on one product — a variable universal life policy — and it was all the managing partner wanted us to talk about with every prospect we met.
Even as a novice agent, I knew deep down that not everybody on the planet needed a VUL policy. What’s worse,...