All topics

Growth Growth Strategy Sales

Unlocking Success: Mastering the 7 R’s of Referral Relationships

Unlocking Success: Mastering the 7 R’s of Referral Relationships

Close-up shot of the hands two businessmen in suite and tie shaking hands
Close-up shot of the hands two businessmen in suite and tie shaking hands


Referrals from trusted sources are the preferred way for most clients to find their financial advisers.  However, some advisers struggle to create fruitful referral relationships while others have real success in developing deep, sustainable, and profitable relationships with key referral partners.

In this article, we will discuss the 7 R’s of Successful Referral Relationships to enable advisers to deliberately cultivate active and prosperous relationships with other advice professionals 

1) Respect

The first R is Respect. It’s essential to demonstrate respect for your referral partner, their profession, and their clients.  It’s also important to gain their professional respect by demonstrating your skill set and knowledge.  Every accountant (and many a lawyer) has been approached by financial advisers seeking their referral business – and yet in many cases they don’t refer as they don’t have professional respect for advisers.

When building respect, knowing and understanding your Client Value Proposition (CVP) is crucial.  CVP has been a buzz term for so long now that it has lost its meaning for many advisers.  However, in essence, it is about having complete clarity about what you do, for whom and how they benefit as a result. Being able to explain this to your referral sources is key to your success. Sharing de-identified case studies to prove your prowess can work wonders in helping them understand the power of what you can do for their clients.

2) Reciprocity

You cannot expect referrals to always come to you, without you referring back the other way (unless that is the clear mutual intention for the relationship).  Reciprocity also demonstrates respect for your referral partner and their business.

If you cannot refer clients back to your referral partner, consider other ways to reciprocate. One of the most powerful ways to enhance a referral relationship is to provide professional development sessions in their staff training days. Not to teach their staff to provide unlicensed financial advice, but to keep them up to date with strategies that are available, show them the types of solutions you can provide for clients, and help them identify opportunities to refer.  This also gives the added bonus of demonstrating your competence. If you have permission from their clients, the best-case studies are those of clients that they recognise.

3) Right person

This particular point needs more explanation because it includes two important things crucial for successful referral relationships.

  • Firstly, make sure the person you develop a relationship with has the power to influence where the referrals from their business are directed. There is no point in you having a brilliant relationship with the owner of the business, if he/she spends little time face-to-face with the types of clients that you want referred to you.

One of the advisers we work with had a great relationship with the Senior Partner of an Accounting firm and they couldn’t understand why they weren’t receiving any referrals.  When we dug a little deeper, we discovered that the accountants who dealt with the clients had their own friendships/relationships with advisers at other firms and were simply referring all the clients to their friends. The advice business concerned had never spent any time cultivating relationships with the people who had that actual influence with the clients and the potential to refer.  This was a costly mistake.

  • Secondly, ensure that the person referred to you is the right person for your business – that is, they fit your ‘ideal client’ or ‘target market’.  Educating your referral source on the types of clients to whom you can add the most value is another key part of the process.  Many of our clients will share their ‘Client Avatar’ with their referral partners – a document that describes the demographics and psychographics of their preferred clients, along with the challenges they solve and technical expertise that they provide.

Many advisers feel that they will offend their referral source if they turned away a client and that the referrer wouldn’t be inclined to send new clients in the future.  The fact that they’ve referred to you doesn’t mean that they expect you to deliver services to a non-ideal client at cost or at your expense – take it as a sign that they want to send people to you, they just don’t know who to send, and use it as an opportunity to educate them. Make sure you still solve the problems for their client by referring them on to someone else to serve their needs, then take the time to explain what to do with a similar client in future.

4) Results (communication of)

When you receive a referral, it’s essential to thank the referral source and to keep them informed as to their progress. While you cannot breach their privacy by sharing details about the advice you’ve provided, you can keep them informed and therefore build their confidence that you’ve solved their challenges, which will reflect well on them.

A great example of communication of results is where an adviser responds to their referrer with no less than four emails:

  1. An initial email expressing gratitude for the referral and providing details on the scheduled client appointments.
  2. A second email after the appointment telling them how it went and that she was sending out the letter of engagement.
  3. A third email thanking them again and advising that they’d signed all the paperwork and her firm were in the midst of implementing the advice.
  4. A fourth and final email after everything had been put in place advising them (with permission of the client), of the relevant matters that the accountant would claim in their tax return that year.

While this may seem extensive, from the accountant’s standpoint, it fosters delight and trust, thereby reducing any reluctance in referring additional clients to the adviser.

5) Regularity

Communication between you and your referral source needs to be regular.  It’s not enough to go and see the referrer once, explain what you want, have them agree and then sit back and wait for the referrals to roll in!  You should be in regular communication with your referral source.

This means:

  • Ensuring they receive all your regular email and newsletter communications.
  • Establishing quarterly catch-ups to stay updated on each other’s businesses. Show genuine interest and offer support, even if just as a sounding board. Mutual understanding enhances empathy and focus on the right type of referrals.
  • Keeping them informed about the progress of their referrals to you (as outlined in the Results section above).

One of the findings from our research on what sets apart the very best advisers is that without fail, they run their referral relationships like a finely tuned machine. They leave nothing to chance; they don’t simply have casual coffees from time to time. Instead, these businesses have systemised processes to ensure that not only the advisers, but also the support staff who implement clients’ advice have a regular communication path with the referral source. And the success of those referral relationships is not left up to chance.

6) Relevance

To obtain referrals from a new referral partner, you need to understand what is relevant to them and their clients.  Both in order to find partners for whom your services are relevant and to ensure you share similar views as to why they might refer.

What’s in it for them to refer to you? It’s likely that the professionals you seek are those who will value your ability to solve the problems of their clients. Rather than desiring a referral fee, they’ll prefer the gratitude they receive and the satisfaction that comes with knowing their clients have been taken care of. 

If your intentions or your client types are not aligned, it won’t matter if you deploy the previous 5 R’s; you’ll be far better off seeking new relationships or spending more time with existing ones that haven’t yet borne fruit (if they’re relevant).

7) Reach

To maximise your referral potential, you may wish to expand your reach beyond your existing referral partners. Consider the other professionals your clients may be working with, such as lawyers, mortgage brokers, or general insurance agents. They may not be obvious referral partners, but if they work in the same ‘target market’, they could refer clients to you if they understand what you do and the value you provide.

You could also join local business groups or attend networking events to meet new professionals and expand your referral network.

In conclusion, mastering the 7 R’s of Successful Referral Relationships is essential for advisers aiming to build lasting partnerships with peers. By embodying respect, reciprocity, and alignment, while maintaining regular communication and relevance, advisers unlock their referral networks’ full potential. Embracing these principles fosters trust, loyalty, and fuels sustainable growth. About you, how do your referral relationships measure up? Are you nurturing them enough to ensure they contribute to your future success? Reach out to us to know more about the art of referrals.

A headshot photo of Sue Viskovic, the General Manager in Consulting of VBP
About the Author
Sue Viskovic
General Manager-Consulting
General Manager-Consulting
Sue Viskovic is the General Manager for Consulting of VBP. With over 20 years in financial services, Sue brings expertise across banking, funds management, advice, and licensee services. She empowers professionals to optimize operations, driving tangible improvements in their fields.

Subscribe to the VBP newsletter

Stay tuned to our latest stories through your email.

A Platform for adviser firms to scale and leverage

Improve back-office operation, reduce cost and improve task turnaround time.

Most read articles

Related topics

More related articles

Subscribe to
the VBP newsletter

Stay tuned to our latest stories through your email.