Most advisors recognize the value of referrals, but few seem to understand the psychology and the processes that promote referrals. Most often, both parties in a referral situation measure the success of the referral process by the outcome: If the prospect becomes a client, the referral was successful. Advisors need to understand that the most important part of a referral is the behavior. It’s the referring behavior – not the outcome of the referral – that you want to promote and reward. It’s more important to focus on the process than on the result to improve the quantity and quality of referrals you receive.

The three-step referral process for clients is designed to enhance the role and value of your clients in the referral process. Each step has a specific goal to help promote and reward the referral behavior.

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