Why You Shouldn’t Trust Client Surveys

September 9, 2014

by Beverly Flaxington

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Beverly Flaxington is a practice management consultant. She answers questions from advisors facing human resource issues. To submit yours, email us here.

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
Dear Bev,

We recently completed a client survey. The results were overwhelmingly positive, but one part was frustrating. Our clients said in the survey that they recommend our firm to others, but our actual client referrals are relatively low. Is there a way to confront the clients who responded to the survey and ask them where these referrals really are?

Brian L.
Dear Brian,

Do you really want to “confront” clients who have just told you how great you are and beat a referral out of them? I’m kidding, of course. But the tone of your question is a bit too aggressive for the situation. The good news is, you have very satisfied clients and they say they are telling other people about you. The bad news is, no actual no business is coming from referrals.

There are a few things you can do to explore what’s happening and what to do to shift the results:

  1. Realize that most clients who say they are telling others about you are in fact doing so. Consider this: I tell my friends about my great advisor, and my friends say they are going to call. Am I likely to keep asking my friends if they have called and following up with them? Not likely. I assume once I give the name and number, they will follow through. So, rule #1 with clients is, tell them that people rarely follow up on their own because life gets too busy, so you’d prefer that they give you names and numbers of prospects so you can reach out to them.
  2. Remember that clients don’t necessarily refer to do you a favor. They refer because someone they know or care about needs help. Rule #2 – be sure to describe clearly the types of people you work well with and how you can help them. Do this every time you get together with clients as a reminder. Life changes and while they may not know prospective clients at one point, at another point they will.
  3. People remember and can re-tell stories to others. Rather than just saying, “I have a great financial advisor,” I am more likely to repeat a story I’ve heard to others about an interesting financial situation. Rule #3 – choose a couple of stories about people you have worked with that might fit the friends and family of a client you are talking to. If a client is a corporate executive, tell the client about other corporate execs you have worked with to help maximize their company benefits. If a client is nearing retirement, tell the client about others who have moved into distribution mode and how you have helped them. This is not a sales pitch, it’s an informal sharing of stories that might remind your client of an acquaintance and give them a way to talk to that person about what you do and how you can help.
  4. Continue to follow up with clients and emphasize that you can help them refer. Rule #4 – make sure there are new materials, interesting information and updates beyond the standard “market outlook” that your clients might be compelled to share with others.

You have a great opportunity here with happy clients – put a strategic effort behind this and stay consistent to see more results.

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