Referral systems as part
of your marketing plan.

Last month we looked at referral systems and how effective they can be in generating new business. Every practice is currently focused on maintaining, if not increasing, profit levels and winning new clients.

Given it is a very tough and uncertain economic climate at present for many, there is even more focus on keeping up with competitor accountancy firms and getting the best return on the time you invest in growing the business.

Referral systems should be an integral part of your marketing plan. Even sole practitioners and the smallest of firms should have a marketing and business development plan. It is a good use of your limited time resources and gives you a clear focus and action plan to work on- remember, little by little and small chunks of time each week will ultimately yield results. A marketing plan should be shared with your team- they will ‘buy in’ to the firm more when they feel part of what the future plan is and know what is going on.

In last month’s feature we went through a basic checklist of the key referral systems. By now you will have some data to collect and these are the key performance indicators you need to measure;

  • Where do the majority of referrals come from
  • How many referrals lead to potential new client meetings
  • What is our conversion rate from meeting to signed up client
  • What is the value of potential new business annually from each referral source and initial prospective client meeting
  • How many referrals come from existing clients- which clients and why.

Existing client referrals are likely to be the most successful in terms of converting. They will already have heard a lot about you!
Once you have the above data, set up a simple system for monitoring it monthly. Data is only valuable if you then do something with it. This is where your marketing plan comes in.

You will already know what your growth target is for the year ahead. Look at the referral systems results and see what potential there is for referrals to help achieve your target. Ask yourself the following and re-set your action plan accordingly;

  • How many new business clients do I want this year
  • What is the average annual fee per new client I am targeting
  • How many of these can I generate from my referral sources- assuming you are proactive about asking for referrals and following up leads consistently.
  • To sign up ‘x’ number of clients at my current conversion rate- how many potential new clients do I need to meet with each month.
  • How much time will this take and can I book out that time regularly in my diary.

The above approach, if followed consistently, will undoubtedly prove to be the best source of generating new fee income and clients.

Using referral systems is less expensive than using many other third party ‘cold calling’ appointment generators and is much more likely to win you business that matches with your firms ideal client profile. You are also in greater control of how and when you spend your time on business development.

The majority of progressive and more successful firms now focus on referral systems as a key part of their marketing and business development plan. This supports their ‘target list’ of businesses they know they want to act for and are in contact with continually as they try and ‘court’ an opportunity to meet with these prospective new clients.

If you are lucky enough to have a break over the summer then perhaps give this some thought and plan to start afresh in September. September is one of the main ‘hunting’ months for winning new clients as business owners see it as a good time for a new start with a different advisor who can better support their needs.

Finally, also thank your referral sources and have a system in place where they receive a thank you gesture automatically when you meet or sign up a potential new client. This will only encourage them to keep referring to you and works particularly well with existing clients. With third party referral sources (banks etc.) you have to keep a log and ensure you give referrals back to them in order for them to want to continue playing the game!

July 2016 Copyright - Finola McManus, Practice Perfect

Helping accountancy firms to make their clients successful


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