President's Letter - The Most Impactful Referral is From...?


Most financial industry professionals know that the most effective way to grow an advisory business is through referrals. In fact, based upon research that Spectrem Group recently completed entitled Preferred Sales Approach: Capturing the Wealthy Investor, more than 70 percent of investors chose their advisor based upon a referral from someone else. It could be from family and friends, an accountant, an attorney, someone they work with or someone else at a firm they might already use. But which of these referrals is the most important to an investor? And how many referrals do they need?

Referral sources change significantly based upon age. Millennials are just as likely to consider their family member as important a referral source as their accountant. Older investors, however, consider their accountant to be the most important referral source. 


Most investors (55 percent) will be satisfied with just one referral, however, 29 percent of investors seek at least two referrals and 9 percent want three or more referrals. Only 8 percent of investors do not need a referral.

So how does an advisor become the primary referral for an accountant? Spectrem explored these important themes in research entitled Centers of Influence:  The Influence of Gatekeepers on Referrals and Wealth Transfer and found: 

1. Accountants and attorneys are more likely to recommend a financial advisor who has a certification, specifically a CFP or a CFA.

2. Accountants and attorneys prefer a financial advisor who will work as a fiduciary.

3. Accountants and Attorneys are often attracted to advisory firms that create and present a content based presentation at a professional event or conference, especially if the presentation has CE credit attached.

4. Don’t bother accountants during tax season.

5. Accountants and attorneys like to recommend advisors who are specialists.

6. Contact via LinkedIn is preferable to other communication methods. It is considered non-intrusive.

7. Responsiveness and the ability to work as a coordinator and team member for a particular client is expected. Accountants and attorneys don’t want to refer an advisor who will reflect poorly upon them.

8. And...a quid pro quo is nice. They want the advisor to also make referrals to them.

As professionals of all types face ongoing threats from technology based platforms, it is important for experts of all time to for relationships across industries. But forming relationships with both potential clients as well as referral sources is a difficult road to navigate. 

It’s important to note that a continuing theme for attracting referrals, both from existing customers as well as from potential gatekeepers, is the importance of continuing to provide relevant content and expertise. Advisors not only need to have expertise, they must continue to demonstrate and communicate that expertise if they want to continue to grow their business.


Receiving referrals is not just a matter of entertaining existing customers and playing golf. There must be an ongoing outreach regarding important issues impacting the financial lives of clients.