Thursday 21 November, 2013

The Power of Referrals and How to Get Them

Referrals are the best way to build your business. If you have enough of them, you don’t have to spend so much of your resources on advertising and marketing.

Most of us get referrals because we do a good job and our happy customers or clients tell everybody. But this is a haphazard way to go about it. If instead you take control of the process, define what end result you want, and create a system for bringing about that result, you’ll have much better success for your efforts.

Define Your Ideal Customer

Start by identifying your ideal customer. Make a profile for this person. Identify their demographic information, their likes and dislikes, their attitudes, shopping habits and any other factors you can pinpoint. You’ll get all kinds of customer referrals, but if you have a clear idea of your ideal target, you’ll better be able to find them.

Identify Referral Sources

Now, work backward from this ideal customer and identify your ideal referral sources. Who is going to refer you to this person? Sources may include other customers, online forums, social media, offline networking events, etc. If you’re not sure where to go about finding referrals, think of a good referral your business has had in the past. Where did it come from? Use this as a starting point.

Offer an Incentive

Give your current customers or clients an incentive for referring new ones to you. This incentive could be a discount or bonus, exclusive content, free membership to a pay site, or something similar. It’s good to clearly state this to your customers. You can hook up a customer because they referred you and this will create good will between you, but it’s better to set up an incentive program whereby a customer knows what they’ll get for their referral.

Write a Referral Request

Whether looking for customer referrals, client referrals or networking opportunities, you should have a written referral request. In the old days this was a letter but today it’s usually email (although a letter is considered very classy). Create a standard template that you can then alter to suit the situation. In the request, remind the person who you are and how you helped them. Identify your ideal customer or client and remind them of the benefits they get for referring someone to you.

Write a Recommendation Message

You may want to write a recommendation message template. This is a letter you write for the referrer that introduces you, your business and the benefits of working with you. For customer referrals this usually isn’t done but in more formal business situations it’s common. It helps to do this because you can ensure that the referrer will say what you want them to say. It also makes it easier for them to refer you because they don’t have to write the message themselves.

Your Follow-up Strategy

Finally, the last part of the process is your follow-up strategy. This is where you follow-up with new referrals and begin a dialog with them (if the person is a customer, this would be the entrance into your sales funnel) and also a plan for following up with the referrer to thank them.

Businesses with a solid, streamlined referral system are able to expand their connections and grow their leads, customers and clients. It’s something every business should have in place.

Bob Steele

Bob Steele

Bob Steele is an entrepreneur, software developer, marketer, and author living in the Denver metropolitan area. He’s an avid outdoorsman who loves skiing, hiking, fishing, boating, and just plain having fun. His interests include games, space, technology, physics, cooking (well eating actually), economics, business, internationalism, and team sports. With over thirty years of professional consulting experience, Bob has been exposed to many diverse business models and has gained a sensible approach to life. Bob’s company, WaveCentric is focused on commerce, marketing, and entertainment related products.

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