11 Feb 2019

Referral Objection Handling 101——How to Make a Client From saying No to Yes?

 “I’ll check with them first.”

“Sorry, I’m not comfortable with giving names…”


After a good afternoon talk with your client, you asked for a referral and receive this polite rejection right away.

Does it sound familiar?

For most financial professionals, a mere mention of these lines is enough to incite fear. As it’s commonly seen as a sign of objection for referrals. Good news is, dealing with these scenarios correctly can actually twist them into another opportunity in your referral path.

Therefore, we are going to teach you how to tackle these puzzles of referral objections by applying the following sales languages.

Common Objection #1 I’ll check with them first

Perhaps this is the most common objection which financial advisors have encountered in their careers. What does this line mean? If we dig into the root of this line, we might understand that the real concern behind this line is:

I’m feeling uncomfortable giving names right now because there’s a chance that giving you their names might spoil my(client’s) relationship with them.

This is a fair concern. It might because of their previous experiences with a financial advisor who did a dismal job that successfully ruined that client’s impression of the rest of us. As a result, there’s an ongoing debate in your clients head about whether to trust you or not. In this case, we can follow up their lines by replying them under two principles:

1. Accept and Acknowledge(A&A):

We tend to develop closer relationship with those whose values are similar to us. That is the human nature. As a result, revealing your acceptance in their values of carefulness is a good way to maintain, or even shorten your relationship with your client. In particular, you can say:

“Thank you! I really appreciate that. Some of our clients feel the same way and they try to talk to their friends out of good intentions, of course,…..”

But we are not just ending here.

2. Extend another branch from your previous question:

The worst case in this situation is to close this referral topic right away, and we believe this is the last thing you would like it to happen. Therefore, after applying your A&A strategy, you can continue with something like:

“…., May I know who do you intend to talk to?”

This process focuses on leading the clients to list out some names that you can write them down. Usually, people may feel uncomfortable refusing a person twice in a row, especially when they have good impression in you. Therefore, this is how you turn the situation around. Even though you cannot make it to their numbers, at least you got enough information and opportunity to drop off referral seeds in the next meeting.

Common objection #2 I am not comfortable with giving names.

Under this scenario, it’s not hard to tell your client’s disagreement in the concept of referrals. Again, there is an understandable fear in your client’s mindset that his friends or family will not appreciate his recommendation. Some of his contacts might even scold him for giving you their information.

The same tactic applies—-A&A. So you might want to begin with something like:

“I’m glad that you’re not that type of person who just gives names easily. I appreciate that with my friends too”

You let them know that you understand his hesitation, and of course, we won’t stop here.

“Is there any part of the process you are not comfortable with?”

This is a great follow-up question. Not only for getting referrals, but also for your own good. You can actually get true feedback from your clients if they really think there’s a space of improvement in your service (you may want to know the 4 tips of providing a fantastic client experience).

However, in most cases, it’s not your problem but the following three reasons that make them hesitate:

Case 1. Need more observation 

The issue here is that he hasn’t seen enough value in your work, leading him to be uncomfortable and untrusting. Under this scenario, the better way is to continue to work with the client before they see more generated value with your consultation, or

Case 2. There’re satisfied with your work, but doesn’t agree with the concept of referral itself.

Under this situation, which is mostly the case, this something you can say:

“What’s the reason you feel uncomfortable extending the good we are doing, especially your friends and loved ones?”

“Do you think your friends deserve to see the difference themselves? I think it would be a great opportunity for them to see! Why should we decide for them?”

“Good things are meant to be share, right?”

Bring it back to the value you’d created for your clients throughout the previous conversation. You can refer more details from How to ask for referrals-Part 2

Sales statics show that the consumer will normally say no three times before getting to a yes. The objective of objection handling is to downplay the fear and untrust of your clients.

Case 3. The art of stepping back professionally

However, sometimes, your client refuses you simply because you’re facing those types of people who value privacy by nature. under the third scenario when case 1 and 2 don’t work, it’s better to just step back professionally. Despite the fact that passion is a must-have element for providing a good positive client experience, sometimes overbearing passion can contrarily lead to pressure on your clients. You might not get the referral in this meeting, but you will reap the fruits of rewards when your hesitate client faces someone who matches your service.

Don’t miss your 80% referrals—-The 20/60/20 Principle

You might be familiar with 20/60/20 rule, and it is applicable to your clients, too. There will always be 20% that are willing to give you referrals, and 20% who will not. It is impossible to get 100% referrals from your client pool, your mission instead is to make the middle 60% of the hesitating clients give you this chance.

The greatest failure is not failure itself, but the fear that makes you fail to try. Don’t let your 80%(20+60) of opportunities slip away just because of your fear of being rejected by the bottom 20%!

Image provided by The NYU Dispatch

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