Show Notes

Welcome back to the Designer Practice Podcast and I’m your host Kayla Das.

Referral relationships can be one of the most sustainable and cost-effective ways to gain consistent client referrals, and that’s because when a referral relationship is created, therapists and coaches are much more likely to receive ongoing referrals from the prospective referral partner. But like any relationship, referral relationships need to be developed, nurtured and maintained.

In today’s episode, I’ll share with you my four-step process for developing, nurturing, and maintaining a lasting referral relationship so that you can have a steady flow of clients for years to come.

Before we dive into the steps though, let’s define what a referral relationship is.

And I define a referral relationship as a connection or relationship developed between two or more people who agree to provide referrals to one or both parties due to a similarity, commonality, and/or mutual benefit that serves all parties ongoing.

So, let’s dissect this definition a little bit, shall we?

Defining Referral Relationships

There’s really two parts to this definition. First, there are two or more people agreeing to provide, and in turn receive, referrals. And the second is that the two people have some similarity, commonality, and/or mutual benefit in the relationship that serves all parties ongoing.

Most of us are quite familiar with the desire to receive ongoing referrals for our practices, and to and that tends to be the driving force for us to even start reaching out for potential referral relationships. But something that is often overlooked is the second part of that definition, where the person we are wanting to develop a relationship with, must have some similarity, commonality, or mutual benefit for both parties ongoing.

One of the biggest mistakes that I’ve seen over the years in our field is when therapists or coaches seek out professionals with the sole intention for them to receive referrals from a professional without determining if there is a similarity or commonality say between the clients that they serve or also highlighting that similarity or commonality for the potential referral partner to also see that similarity or commonality as well.

In addition, it’s also important to consider how the therapist or coach intends to provide mutual benefit to the other professional so that they feel enticed to even start building a referral relationship and then also to maintain that relationship long-term.

One of the most common mistakes that therapists do is that they write a ad-like letter and send them out to professionals. And if this is you, please don’t worry, because I’m pretty sure we’ve all been there, I know I have. And hopefully through this episode today, I can share with you some information so that you can avoid this trap in the future.

Now, I am pro- email for initiating contact with potential referral partners. However, going back to the second half of the referral relationship definition, we want to ensure that we somehow include or acknowledge that there’s similarities or commonalities. Usually that starts with probably the clients that we serve, as well as the mutual benefits that we see for both parties, both you and the other person.

So now let’s actually dive into these four steps. So, let’s get started.

Step 1: Reach Out

The first step to developing a lasting referral relationship is to reach out to someone who you believe could be a sustainable referral partner. And what I mean by that is to reach out to someone who you have a similarity or commonality with respect to the types of clients you serve, but not necessarily in direct competition with.

Let me give you an example here. If you work with women experiencing postpartum depression, you might reach out to birthing centers, doulas, midwives, lactation consultants, and maybe even pediatricians because they may see babies shortly after birth and detect a need for your services for mom. Other viable options are other mental health professionals or therapists who work in similar but not necessarily competing services. So, for example, maybe there are mental health therapists in your area who work with mom prenatally, but not necessarily postpartum. You, of course, could always create a referral relationship with other mental health therapists who are in the exact same niche as you and are quote unquote direct competition. And this usually works if someone is looking for referrals for, say, an overflow situation where they can’t accept any additional clients because their caseload has maxed out. But one of the issues with this is you won’t likely receive consistent flow of referrals, and that’s because both you and the other person are likely going to have a caseload that fluctuates from time and time again. Doesn’t mean you can’t create these relationships, but it may not be the first place to start. That’s why it’s good to think about the similarities and commonalities, but not necessarily who you’d be in direct competition with.

When considering to reach out to prospective referral partners, it is important to connect with them authentically. And what I mean by that is although you want to be professional in your communication, you’ll want to avoid being too ad-like, impersonal, or too formal in your communication, especially if you choose to use written letters or emails as your method to reach out. Because it can impact the connection factor that you will likely have to entice the person to actually return your email and connect with you.

And I think we live in a world where we feel that we have to be highly, highly intellectual or clinical to be able to show our expertise to people. However, that doesn’t really create that connection piece. So, it doesn’t mean you can’t be professional in what you write, but you don’t necessarily have to write it as if you’re a CEO of a big corporation. You really want someone to feel enticed to actually return the email so that they can start building that referral relationship with you. So, in other words, I do encourage you to be yourself, not to pretend to be someone that you’re not, and also not to be one-sided with your ultimate ask.

When I reach out to potential referral partners, I try to focus more on how I can help them versus how they can help me. Even though, of course, in the end, I want them to help me in some way too. But usually when we focus more on how we can help them, it usually entices at least a follow-up email and potentially a phone call moving forward.

And I actually want you to think about it this way. Have you ever received an email or a phone call from someone that you just didn’t know and they tried to pitch you something, whether it be a product, a service, or just to send referrals their way? How did you feel when you received that email? Was the person authentic or were they inauthentic? Did you like or dislike their approach? And also, what actions did you take after receiving the email or the phone call? Did you delete the message, or did you actually follow up?

The best way to determine how to reach out to someone is actually to determine what you would do if you received the same type of communication. Typically, the most effective emails or phone calls are those that are personal, authentic, and also highlights mutual benefit for both parties, not just one, i. e. yourself.

In my business coaching, I tend to receive emails probably every other day for something and I can tell you what’s worked and what hasn’t worked for me. Typically, if I receive an email that feels generic, like it’s been sent to a bunch of people, it also doesn’t address me by name, or even explain how the product service or referral relationship would work or will also benefit me. I usually press delete. However, if the person addresses me by name, highlights the similarities or commonalities of our services, it shows me that they actually did their research and they know a little bit about me and my business. And it also explains how they see a relationship working on going. I’m at least enticed to book a follow up call with them to learn more. Because this really does pique my interest.

Because as humans, we are interested in ourselves. And I don’t want to say that in a selfish way. But the truth is that even our intent to reach out to people is for us to get referrals. And the other person also wants to know, first, do we have the same clientele? Who can I start referring to you? And then also, what’s in it for me or my business?

In my opinion, one other thing that doesn’t tend to work well is adding a letter as an attachment to an email instead of just making the email the actual letter. And there’s a few reasons why I believe that this doesn’t convert very well. The first is usually the email itself is generic, so if you’re attaching a letter, you’re likely not going to repeat that letter. And you’re likely going to have something like, “Please see the attached document for a letter of referral relationship” or something like that. But again, that’s too formal and also too generic and it’s not likely going to entice me to open that document.

The second is in today’s world with computer viruses and hackers on the rise. People don’t tend to click on links or files from people that they don’t know. And I know that is certainly true for me. Especially if we are using our work emails, because if we’re using our work emails, that can pose greater risk than even just our personal emails. So even though your attachment is not likely going to be a virus, the other person, if they don’t know you, probably doesn’t know that and they’re not going to open it.

The third is it actually takes extra time to open a document than it does just to skim through an email. So, if people are busy it’s possible that they might just leave it for later and forget it at all. Or just delete it because it’s just too much work. So, by having it in an email, it shows people, it almost entices or encourages or forces people to read the email versus having to download an attachment to also read it.

Step 2: Build Rapport

So, the second step to developing a lasting relationship is to start building rapport with the prospective referral partner. One of the best call-to-actions on any email is to ask them to schedule a call with you and even, if appropriate, to have coffee. Coffee dates still work, even post pandemic. And let’s be honest, as humans, we are social creatures, and when we know someone personally, we are much more likely to start building a relationship with that person. Similar to friendships, referral relationships require that each person get to know each other and ultimately like each other for that relationship to work.

And as a therapist myself, I only give referrals to people that I’ve met and actually know. Because I want to know that when I give a referral to a client, that I am referring them to someone who is going to treat them just as good or even better than I would. So prospective referral partners are likely thinking the same, because they want to know, “Is this person someone that I feel comfortable referring my clients to?” And if they don’t know you, they’re probably not going to feel very comfortable about referring to you. And of course, once you start building rapport with that person, they’re likely going to start feeling comfortable and feel confident about sending referrals your way.

Step 3: Identify Mutual Benefits

The third stage is to identify mutual benefits. A key difference between a referral relationship that is short term versus long term is when there are mutual benefits involved. And I’m not saying to go out and pay for referrals. That’s not what I mean by mutual benefits. And actually, some regulatory bodies frown on that. But trying to build a referral relationship where the benefit is only one-sided, in other words you expect them to give you referrals but you don’t give them anything in return, the relationship is going to fall apart pretty quickly.

And sure, you might get a referral in the beginning, or maybe even a couple referrals, but it’s not likely going to build that lasting referral relationship because only one person is receiving some benefit there. And there needs to be something for the other person for them to feel enticed to continue to give you referrals long-term.

And this is why ad-like letters or emails don’t typically work because they often ask for referrals without even considering the other person and how you can help them and their business in some way. Prospective referral partners really want to know, “What’s in it for me?” Or “how will this relationship help me and my business?” When the prospective referral partner sees ongoing value for them, they’re much more likely to reciprocate the relationship, which in the long run will help you continue to start receiving referrals that you’re looking for.  

The other thing, and this has also happened for me too, is that when someone expects a lot from you, it can create some resentment. And I’ve had some business relationships in the past where I felt that someone expected a lot from me, but didn’t give me much in return. And then I felt a little bit resentment towards that, and actually just decided not to continue that relationship. So again, there needs to feel that there’s some sort of benefit for both parties.

So, it’s about now when I get the question from therapists, “What if I don’t know what would be mutually beneficial to the other person?” And my answer is usually something like this. “It’s totally okay, because no one expects you to read someone’s mind.” And you can’t explore this during the building the rapport stage. And as long as you introduce or allude to that you want to help them and their business in some way, and that you’d like to also discuss more about how you can do that, usually you’re golden.

Because everyone finds benefits in different things, it’s really hard to predict what someone would find mutually beneficial. So, you really don’t need to know what that is yet. Sometimes people find having a mutual referral relationship for client overflow is enough. So, giving the example of a mental health therapist, if you create a relationship with a mental health therapist who works with women experiencing prenatal stress, versus postpartum depression, you might be able to give each other clients back and forth and that might be mutually beneficial enough. Even if you create a relationship with someone who is quote unquote a direct competition to you, that might just be overflow like I mentioned, right? Someone may have a full caseload and need someone else to refer to. Again, that might be mutually beneficial enough. However, other times, a prospective referral partner may request something else that they would feel would be beneficial to them. And also, I can’t underestimate that sometimes even just having a connection built through the building rapport stage, like having a colleague or a professional confidant, is also the benefit that matters the most. But, at the end of the day, the referral partner can help you determine if the referral relationship is actually mutually beneficial. But it’s just important to acknowledge if one person feels they’re getting more than the other, the relationship is probably not going to last long term.

I do want to give a disclaimer here as well. So this step is about mutual benefits. So if prospective referral partners ask you for something that you know you cannot provide for whatever reason, maybe ethical or otherwise, you can always provide a counteroffer or you can be honest that you cannot fulfill their request and ask if there’s something else that you can help them with. And also, not all referral relationships will work out for various reasons. And that’s okay.

Step 4: Build Trust

So, the final stage is to build trust. When trust is built, a referral relationship is much more likely to be created than when trust doesn’t exist.

Like I said before, at the end of the day, referral partners want to know that when they refer clients, that their clients will be served just as good or better by you. When trust is built, the referral partner has confidence that you are the best person to serve their clients, and they will continue to refer clients to you.

I want to go back to something I said in step three. Where not all referral relationships will work out for various reasons. Sometimes it’s not about mutual benefit at all, but more about the trust or even the fit of the referral relationship.

And let me give you a personal example from my business coaching practice. As you know, one of my passive income streams inside of my practice is affiliate marketing, where I advertise products, whether it be through my blog, social media, or even this podcast. And I get a commission from products sold through my affiliate links. By the way, thank you if you’ve ever purchased anything from my affiliate or podcast links. It does help me continue to provide this free content. But anyway, it’s important for me to only share products that I’ve either used or genuinely support through the rapport that I’ve built with a person or their company.

And from time-to-time, someone I’ve never heard of will reach out and ask if I want to be an affiliate for them. And if they entice me by using the steps I’ve listed in this podcast, I’ll reach out and book a call with them just to learn more about what it is that they’re trying to sell and how it might help you, the listener, my ideal client. But there’s been times through the rapport building stage where I didn’t see a fit between the product, service, or affiliate relationship. Whether it be because I didn’t feel the product was something my listeners would be interested in or benefit from; or I felt the values or vision of their business might be very different from my own; or I just simply didn’t trust that they had my listener’s best interest at heart. So regardless of the mutual benefit, the relationship didn’t come to fruition. Sure, I would have got a commission, but it definitely wouldn’t have felt good to me to be sharing products that I didn’t feel that fit for whatever reason. And that’s okay. It doesn’t mean that these are bad products. It doesn’t mean these are bad services. It just means that it wasn’t a fit for my business.

Recap

So that’s it. That’s the four steps for building a lasting referral relationship. So, I want to recap:

Step 1: Reach Out.

Step 2: Build Rapport.

Step 3: Identify Mutual Benefits.

And Step 4: Build Trust.

Also, I want to leave you with some words of wisdom. If you don’t find a lasting referral relationship on the first try, please don’t give up. It does take time because a referral relationship needs to be developed. nurtured, and maintained for it to become long lasting. But when you do find a referral partner who is a good fit for you in your practice, you’ll have a referral partner that will grow with you in your practice well into the future.

So, thank you for tuning in to today’s episode, and if you like this episode, please share this podcast with a colleague so that they can access all of this content on our channel as well.

Until next time, bye for now.

Credits & Disclaimers

Music by ItsWatR from Pixabay

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