We spoke with Michael Riherd, Managing Director – Investments and Financial Advisor at Wells Fargo Advisors, LLC in Walnut Creek, CA, to understand some of his best practices around increasing the overall growth of his business through referrals. With more than 40 years of combined financial services experience, The Riherd-West Financial Group of Wells Fargo Advisors offers a wide range of services to help investors reach their ultimate goal of financial independence.

Understanding Client Needs

At the start of the client relationship, we spend time getting to know our client, understanding interests, goals and concerns before drawing up an investment plan or recommending specific investments. We work closely with our client to see where they are today, where they want to be in five years, 10 years, 20 years, and all the years in between.

We understand the capital markets and global economic situation and how to cull that information into unique investment plans for each client's situation. Based on a mutually decided-upon plan, we are here to help engineer or maintain our clients' financial independence throughout their lifetime.

Growing the Business Through Referrals

Because we are fortunate enough to have been in this business for a couple of decades, we have an established client base, and therefore, the majority of our referrals come from our network of existing clients. And that's the best referral for which we can hope.

Our clients know what we stand for—so they can confidently talk about our practice, our services and our business proposition. We focus on satisfying our current clients, exceeding their expectations, and they will then be more likely to refer other investors like them.

Building Alliances and Influence

Another way we have built our business over the years has been by receiving referrals from intermediaries, such as CPAs, estate-planning attorneys and tax attorneys. While a very effective way of creating a client base, initially we found it difficult to gain the confidence of these intermediaries.

3 Tips to Gaining Confidence

  1. Take an educational approach. Position yourself as a consultant, so that you can provide research on the markets and teach other professionals about your business. For example, educate CPAs about the importance of bond duration versus bond maturity, or demonstrate your understanding of tax issues and accounting methods surrounding charitable remainder trusts.
  2. Be a partner more than a salesperson. Make yourself available to understand the intermediary's business and find ways that you can support the growth of their client relationships. The greatest success comes from creating more of a consultative relationship.
  3. Be consistent in your message. Reinforce your value and the resources of your firm. Share ideas on ways that your resources can support relationships. For example, at a recent event we invited 80 CPAs to hear our Wells Fargo Advisors strategist speak about the capital markets and the world today.

When we become that valued resource to a center of influence, we find that referrals come flowing into us.

    Identifying the Right Prospects

    We see a legitimate prospect as someone with a need—an addressable need. In the course of coming together with a prospect through an intermediary, that need has already been vetted. The intermediary has already identified that individual as needing you or someone like you and has said, "You need to speak to Mike because you need this."

    Time spent educating the intermediary on what clients need to know as they think about retirement, as an example, or educating them on our business and the capital markets, is far more valuable than cold calling and trying to select that one person out of a thousand who may have a need.

    Acknowledgement to Clients

    When we receive a referral from a client, we immediately look to set up a meeting as a first step. If the introduction is at a cocktail party and not appropriate to ask for a meeting there, we look for approval to call within the next day or so. Once we can get in front of each other, from there we can assess whether it's a legitimate prospect or not.

    We are honored by the trust our clients have placed in us to work for them and their friends and family. To show our appreciation for any client referrals, we always send a gift basket to acknowledge our gratefulness. We understand the trust that clients are placing in us and we take that trust very seriously.

    Our clients know what we stand for—so they can confidently talk about our practice, our services and our business proposition. We focus on satisfying our current clients, exceeding their expectations, and they will then be more likely to refer other investors like them.

    The information obtained from this research is derived from third-party sources deemed reliable, and is provided to you for educational purposes only. BlackRock cannot guarantee the completeness or accuracy of the information provided.

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