I don’t care what type of business you are in, there is no better sales lead than a referral from a satisfied customer. Yet most businesses and sales people take referrals for granted. They are grateful for the ones they get but very few have a plan for generating them.
Like any other sales or marketing you are doing, having a systematic way of asking for and working referrals is essential. If you are already getting them now, think of how quickly you will be able to ramp up sales with a more aggressive approach!
The #1 Secret To Generating A Flood Of Referrals This may surprise you but the #1 secret to generating referrals is not a clever sales letter or some magical phrase you utter to your clients that causes them to whip out their rolodex and give you every name contained within.
You get customers to refer by providing services and products so excellent that your customers are in complete awe. Satisfied customers who receive “good” service do not refer in abundance.
Customers talk about you to their friends and colleagues when they receive more than they paid for”fast and friendly service”personal attention by someone who cares.
They also turn into loyal customers.
Loyal customers are happy to write you checks over and over again. Loyal customers pay on time and don’t hassle you about your fees. Loyal customers wouldn’t think of doing business with anyone else. Loyal customers tell everyone they know about you.
Now here’s the million dollar question: Are your customers satisfied or loyal? You’ve got a lot riding on that answer.
When To Ask For A Referral
I find one of the best times to ask for a referral is right after getting an “atta-boy”. When a customer tells you they are very grateful for some service you performed. The reason this works so well is because of an powerful rule of human influence: reciprocity.
This rule says that whenever a person does something for us or gives something to us, we should try to repay them in some way (a great book to read on this topic is “Influence, Science and Practice” by Robert Cialdini).
Other Ways To Generate Referrals: If you are marketing by vertical, you could use a “hit list” approach to prompt more referrals. For example, if you’ve implemented a solution for a law firm, you simply make a list of the top 20 – 30 law firms in your area that you want to have as customers. Take this list to your existing law firm customer and say:
“John, I’d like to talk to a few other law firms in this area about the same service we provided to you. Here’s a list of the firms I’m trying to get an appointment with. Do you know anyone on this list? Can you help me in getting an appointment? What can you tell me about them?”
Conduct referral events. The CEO of a small VAR told me he throws a huge golf event every fall. VIP invitations are sent to customers months in advance and they are encouraged to bring friends. It brings them a CONSIDERABLE amount of business and makes their Q4 numbers every year.
Have referral contests. The premise is simple: the customer providing the most referrals in a given time frame wins a prize. Included in this newsletter is an entire referral contest campaign for you to use.
A word of advice: If you are going to hold a referral contest, make sure the prize is something your customers WANT. A flat screen monitor, a Play Station, a nice outdoor grill, a new computer system, whatever.
T-shirts, mouse pads, and pens don’t offer enough incentive, and they make you look cheap. Keep in mind what those referrals are WORTH. You can’t buy better advertising.