How To Respond When Clients Say “No” To Providing Referrals

As a financial advisor, it’s critically important to practice your language. This is particularly true for knowing the top objections you’re going to face and how you will respond to them.

Most people think that the importance of great language is so that you sound really good in front of your client. While there is some truth to that, having great language is more about you.

It allows you to have a track to run. Having your language down allows you to respond with confidence and focus on all the other important aspects of communication, such as your body language and tone, without having to think through what words your going to say.

It also creates consistency, so that you are not saying one thing to one client and something completely different to the next.

Common Objections that You’ll Face When Prospecting

In my prospecting system, what I train advisors on is how to get well nominated referrals.

There is nothing more powerful than getting an extremely well nominated referral to someone that your client has a great relationship with already.

It is through this referral that you are able to essentially borrow the trust of your current client to make building trust and a relationship with a new prospect so much easier.

However, when you ask for referrals, you need to be prepared for objections or you are setting yourself up to lose the opportunity.

Objections should not catch you off guard!

You only have to be in this business for a few months before you’ve heard just about every single objection you’re going to face. Many of these have been covered in past blog posts, but the one many advisors stumble on is if a client just straight up tells you “no” when you ask for a referral.

This can take a few different forms, but may come across as something like “Jim, I’m simply just not comfortable providing referrals at this time” or “I just need see where you’re going to take this before I endorse you to my closest friends.”

What To Do When Clients Say No To Referrals

Where many advisors mishandle this objection, is they take a situation that is uncomfortable and then they make it really uncomfortable.

They press on.

They say something like, “Well, why don’t you feel comfortable? What do we need to do?”

You must avoid responding in this manner!

When you become a master of prospecting, you will get plenty of referral where you never need to cross the line between being aggressive and being obnoxious. You don’t ever need to take the situation to an intense level of awkwardness or uncomfortableness.

So, how should you respond?

When someone says “no” to you, I would respond:

“I can understand and appreciate that. But let me ask you something. If we work together on an ongoing basis, will you give me permission in our annual review, once a year, to ask you for favorable introductions, on the agreement that you will never, ever give me a referral until you feel super comfortable in doing so? Is that a fair agreement?”

I’ve never had anyone say no to that response. When they say OK, simply respond “Great, I appreciate that!” and make a note in your case notes. Then, leave at that!

The Advantage Of This Response

When you respond with the language above, most clients aren’t expecting it. They think you are going to force the issue. So it’s an unexpected response and they like it.

The second thing it does is it also allows you to make light of the moment. If you do a good job with your case notes, then when you come back a year later with that client in an annual review, when you get done with the meeting you can say, “Hey Mr. Client, guess what time it is?”
I'd do this with a huge smile on my face.

When you become a master of prospecting, you will get plenty of referral where you never need to cross the line between being aggressive and being obnoxious.

The client usually would respond, “I don’t know, about 3 o’clock?”

I’d say “guess again” or something along those lines, again with a huge grin on my face. And then the realization would hit the client and they'd say, “Oh, you’re going to ask me for referrals again, aren’t you?”
Humorously, I’d say, “Only if you feel comfortable! How am I doing?”

You make light of it! It’s fun. And I can’t tell you how many of my best clients came after years of asking this question. And slowly but surely over time, as trust and relationships were built with the clients, their walls would slowly come down and eventually I’d get the referrals.

So, next time you’re in this situation, remember: Don’t force the issue! Don’t make it more uncomfortable. Set yourself up for success by asking for permission to ask them again in the future. When you receive that permission, make sure you are prepared in you’re next meeting to ask again in a fun and light manner.

You’re clients will appreciate this approach – and, by creating a far greater likelihood that you’ll receive a referral in the long run, so will you!


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