Referrer Management and Cross-Selling Insights (March 2021)

Last week I had the pleasure of facilitating delegates from legal and accountancy firms in the PM Forum’s “Referral Management and Cross-Selling Accelerator” workshop. Here are the key points from the polls, break-out and discussion sessions with referrer management and cross-selling insights. I’ve also included a summary from a recent PM Forum webinar on cross-selling.

Referrer management strategies

The first break-out session looked at strategy and planning of referrer management programmes. Key topics included:

  • Analysis
    • Analyse current and past clients and referrals across the firm and by industry, territory and team. Consider both the volume and value of transactions/work.
    • Assess the capabilities within teams both in terms of specialist expertise, capacity and service levels.
  • Engagement
    • Line up senior management champions, sponsors and role models.
    • Involve people from the outset in the analysis and planning.
    • Provide focused and regular communications from marketing and BD teams.
  • Planning
    • Ensure the information systems capture and track the right information.
    • Establish clear goals and managing expectations.
    • Set out the steps of the programme:
      • For the firm
      • For teams
      • For individuals
  • Execution
    • Allocate time for teams and individuals to implement the plans.
    • Manage central information and knowledge systems.
    • Provide training in the relevant skills.
    • Measure progress and results and report regularly.

In terms of the quality of information systems supporting referrer management the majority said their systems were “average”, closely followed by “poor”. Only one delegate reported their systems were very good and another reported they were non-existent.
37% of the delegates did not have a referrer management plan. Amongst those that had a plan no one felt their plan was effective or being implemented well. 40% did not have any goals for what they hoped to achieve in their referrer management programmes. The others felt their goals were not clear. Only one firm felt their goals were sufficient to measure return on investment (ROI).

Cross-selling insights and poll results

During the session there were a number of polls. The key findings were:
The biggest barriers to cross-selling were (in order of most popular):

  1. Lack of time
  2. No reward/incentive
  3. Fear/risk/protectionism
  4. Lack of knowledge/trust of other teams
  5. Lack of information

During the conversations, several delegates mentioned the lack of fee-earner engagement in cross-selling and referrer management programmes.
The most popular methods of promoting internal referrals (in order of most popular):

  1. Internal communications campaigns
  2. Client satisfaction and listening
  3. Matrix management
  4. CRM targeting activities
  5. Service line campaigns
  6. KAM
  7. Recognition and reward systems
  8. Client workshops
  9. ABM

In a similar question, the following were the most popular methods of promoting cross-selling:

  1. NPS and client listening
  2. Key client analysis and plans
  3. Workflow and referrals analysis
  4. Internal campaigns
  5. Onboarding process
  6. Internal knowledge systems
  7. Cross-selling training
  8. Relationship mapping

Interestingly, no one was using a client grading system or automated prompting of gaps/opportunities.
During the break-out session, the following observations were made:

  • Structural and cultural issues
    • The level of cross-selling depends on the firm’s culture and structure. Some firms are organised in silos with little interaction or clients in common.
    • Cross-firm sector or issues groups promote more a more collaborative approach to assessing and meeting client needs with a range of services.
    • Associates and juniors can be encouraged to form peer-relationships which will increase in value over time.
    • Reward and accountability systems need to be aligned to encourage the desired behaviours.
  • Research
    • Client listening programmes were a good source of insight into what similar clients might appreciate or need
  • Internal communications
    • There needs to be a dedicated internal campaign when a lateral hire arrives so that he or she is properly introduced to relevant teams across the firm.
    • There’s value in collating best practice ideas and success stories and sharing them within the firm.
    • “Lunch and Learn” sessions were an effective way to remind fee-earners to promote other services and give them the confidence to do so.
    • People need guides on who to contact to support clients with specific issues.
  • Training
    • Training plays a large part in educating fee-earners in the services provided by other teams and building trust so that they make collaborative approaches to clients.
    • There was also a role for training in helping fee-earners to develop persuasive propositions that will resonate with different client groups.
    • Skills to help fee-earners recognise and develop opportunities need to be developed.
    • Guides and tool kits should be provided to help fee-earners.
  • Planning
    • Those with dedicated plans for major clients were more effective at identifying gaps, mapping opportunities and planning to convert profitable work in the short and long term.

Referrer management insights and poll results

On segmenting external referrers, the most targeted sectors were (in order of most popular):

  1. Law firms
  2. Accountancy firms
  3. Private equity/Corporate finance
  4. Banks, financial institutions and IFAs
  5. Insolvency practitioners
  6. Regulators
  7. Property consultancies
  8. Government and local authorities
  9. Charities and associations
  10. Other

The most frequently mentioned methods of working with external referrers included (in order of the most popular):

  1. Providing articles and speakers
  2. Joint webinars
  3. Joint client events
  4. Campaigns
  5. Collaborative/joint services
  6. Targeted mailings
  7. Dedicated plans for specific referrer organisations
  8. Targeted social media

The main observations during the final break-out session were:

  • Planning
    • Have clear targeting criteria for referrers (including cultural fit)
    • Develop a focused strategy and approach
    • Align referrer objectives with firm and team goals
  • Research
    • Build a knowledge base of each referrer organisation and its relationship with the firm
    • Consider measuring satisfaction for referrer relationships
    • Implement systems to flag changes in referrer organisations
    • Conduct gap analyses at major clients
    • Conduct formal and informal research to promote mutual understanding
    • Consider how reciprocity can be achieved
  • Execution
    • Start small by focusing of specific areas where you want to increase referrals
    • Focus effort and assign responsibilities/accountabilities
    • Support the development of strong internal and external relationships
    • Ensure systems exist to measure progress and results

Key takeaways

Key takeaways from the session included:

  • Be more systematic in analysing, planning and implementing programmes
  • Align recognition and reward systems for referrals
  • Use heat maps to understand complex relationships
  • Conduct research to understand referrer perceptions and needs better
  • Look at the web site for referrer channels
  • Thank internal and external referrers for referrals
  • Measure return on investment (ROI) which is mostly time rather than cash

 More cross-selling insights

The PM Forum Exeter branch  organised an hour workshop on cross-selling and up-selling in January 2021. The speakers were veteran PSF marketer Jonathan Fox and Peter Rosenwald who is the co-founder of lead generation agency Chartered Developments. I’ve used Peter’s services for telemarketing campaigns as far back as 2005! I’ve summarised the main cross-selling insights from the webinar.

Why cross-selling?

There was an initial discussion about why cross-selling is important and reasons included: risk reduction, increase the number of contacts in the relationship, identify opportunities, increase referral rates and maintain the relationship glue. Peter suggested that 12.25% or 1 in 8 of qualified leads in professional services firms were from cross-selling.
There was a discussion about why many partners fail to cross-sell including reasons such as a lack of time, a fear of failure, client conversations take place all the time and assumptions that the clients will talk about any new requirements.
To help partners and fee-earners to move out of their comfort zones he urged us to demystify the process, break the cross-selling process down and provide training for the required skills (in short sessions).
Peter mentioned – in the context of satisfaction – The US Lawyer finding that “96% of clients will not tell their lawyer if unhappy” but, on average, will tell 19 other people.

Cross-selling ideas

The presenting duo then whizzed through 11 ideas to assist with cross-selling.

  1. Will bank – 61 is the most common age to inherit assets. Most inherited wealth is then invested. Target clients with Wills that are 10 years old. Offer a free Zoom or Teams meeting and learn about the rest of the family, business interests and other assets.
  1. Managing Partner visits – Look up the top 20% of the client base – including estates and private individuals. Arrange for the Managing Partner to call these clients and perhaps arrange a visit or online meeting.
  1. Major account profiling – An example was provided where a client was one group within a holding group. Research was conducted to identify other companies within the group and the relevant directors in each of those companies. 15 opportunities were found across the group and three were quickly converted into clients
  1. Transactions vs solutions – Overcome silos by “never imposing the internal structure externally” and talking about solutions rather than specific services or transactions.
  1. Employment law as a Trojan Horse – Offer in contracts annual HR, employment and business check-ups. This paves the way for regular discussions about emerging issues with clients. Peter shared an example that from 350 contracted clients – with an average income of £1,800 pa and an annual total of £650,000 this approach led to £190,000 of additional work – a 29% uplift
  1. Client roundtables – Organise client roundtables – with or without an agenda – for a mixture of senior representatives of client types to discuss business. Friday evening catch-ups and “bring a bottle” (and tell a story about the bottle) events were also mentioned.
  1. Spheres of influence – Organise informal conversations (e.g. “chew the fat”, fireside chats and MasterMind groups) where you can learn about the connections – whether within immediate or distant family groups, amongst owners and staff or suppliers and other advisers.
  1. As, Bs and Cs – Jonathan suggested categorising fee-earners into As (excellent at client relationship development), Bs (the majority who were OK at client relationships) and Cs (those who were technical experts – the professors and academics). He then proposed that for each client conversation you blend your As and Cs for maximum effect. Some firms include attendance at a set number of client presentations as part of the annual appraisal targets.
  1. Employee benefits platforms – The suggestion was to offer discounted legal services through the employee benefits platforms of companies as “87% of employees value access to legal advisors through employee benefits systems” (2017). Platforms mentioned included: FairCare, Xexec, Sodexo, FlexGenious, InfiniteChoice and Perkbox.
  1. Internal case studies – Success builds success so prepare case studies for circulation internally or share them at internal lunch time seminars. There was also a nudge to review reward structures to incentivise cross-selling.
  1. Client Experience Challenge – Call up clients during and after transactions to assess their satisfaction, obtain their views and explore what they are planning to do next.

The Digital Humanity paper by Chartered Developments covers the challenge of building trust in a virtual environment. There is more information on building trust.

Selected articles with referrer management and cross-selling insights:

Highlights from a referrer management workshop (2020) | Kim Tasso (December 2020)
Selling Basics – Detectives and DMUs (Video) and recommended books | Kim Tasso (October 2020)
KAM Basics – Bowties and Diamonds | Kim Tasso (October 2020)
Six themes on cross-selling and referrer management workshop highlights | Kim Tasso (September 2020)
client portfolio management with dinosaurs – Be more T Rex | Kim Tasso (July 2020)
pragmatic steps to improved referrer management 2019 | Kim Tasso (December 2019)
A personal approach to cross-selling – outbound and inbound internal referrals | Kim Tasso (August 2018)
solicitors to sell – cross-selling and professional standards | Kim Tasso (December 2017)
Cross-selling – The Big Questions – Kim Tasso | Kim Tasso (June 2017)
cross-selling and referrer management | Kim Tasso (June 2016)
Ten tips on cross-selling – Boosting internal networks – Kim Tasso | Kim Tasso (March 2016)
Key Account Management (KAM) programme | Kim Tasso (February 2016)
Cross selling – the dream versus the reality – Kim Tasso | Kim Tasso (May 2014)
What is the secret of effective cross-selling? – Kim Tasso | Kim Tasso (December 2003)