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Professional connections importance rises during Covid

16 November 2020

Advisers who put effort into seeking professional connections attract a greater number of referrals, according to Octopus Investments.  

Research from the investment firm found there was a four-fold increase in referrals from accountants and solicitors among advisers who actively pursued professional connections.

However, while more than two thirds (70%) of advisers said these relationships are key to business growth, only 56% are actively developing connections as part of their strategy. This is despite nearly nine in 10 (87%) advisers acknowledging that holistic and integrated advice with accountants and solicitors creates better outcomes for clients.

Octopus Investments said the main barrier for advisers was a belief that other parties are not interested, with over three fifths (62%) of advisers citing a ‘lack of appetite’ from accountants and solicitors. A further 39% said they thought saturation was an issue, with accountants and solicitors already working with other advisers. However, just 1% of accountants and solicitors polled said they had never referred a client to an adviser, with each professional working with an average of four to five advisers.

The research also found that the Covid-19 pandemic has created further challenges for advisers, with 57% expecting it to be harder to develop new relationships in the new environment and eight in 10 (81%) preferring to meet in person before making referrals.

Charlotte Fairhurst, strategic partnerships manager, Octopus Investments, said: “We’ve been running professional connection workshops with advisers for a number of years and there is a perception that accountants and solicitors either aren’t interested, or they already have a referral relationship in place and are not looking to take on more. Yet this research clearly shows there is still a huge opportunity to create new connections, in addition to the benefits for clients.

“When thinking about how to approach accountants and solicitors, it’s worth demonstrating any specialism that you have, so be specific – they want to know that you’re experienced in dealing with the issues that are common in their client bank. That way you should remain front of mind when particular planning issues crop up.”

Octopus Investments said reciprocity was key to developing a referral relationship and recognition of the level of trust that professional connections place in advisers when making referrals, with 40% of solicitors citing a bad client experience as the main barrier stopping them from making referrals.

Fairhurst added: “Trusted professional connections are becoming central to advisers’ growth plans over the coming years. Our research has shown that some of the most successful advisers are those that have strong, reciprocal referral relationships.

“Professional advice is now more interconnected than ever before – but significant numbers of advisers are yet to unlock the growth potential this can bring.”

Professional Paraplanner