How Well are Referrals Working for Your Business?
We have all heard the old saying, "You have to give to get." This principle remains valid for getting referrals for your business. I am not sure about your business, but at Rhythm Systems we live for referrals, and it generates a large percentage of the new business we receive.
There is nothing better than a happy customer referring you to one of their business colleagues or friends. The thing about referrals is they don’t always happen automagically! Sure, you will get the occasional referral from an existing customer without asking, but you will receive even more if you put a strategy and program in place.
We all know that hope is not a very good business strategy, so how do you go about getting more referrals? According to Nielson, 92% of consumers trust referrals from people they know.
Here are a few tips for building your referral strategy.
- Ensure that your customers' experience with you is so amazing that they want to share what you have to offer with others. Happy and delighted customers make strong referral partners.
- Know who your core customer is to effectively articulate it and share it with those you are asking for referrals. Not every referral is a good one.
- Create a referral program that provides an incentive for others to refer you. This includes monetary incentives for referrals that convert into customers in many cases.
- Document your referral program and share that to make it easy for others to become a referral source for you. I will share more about this in my next blog.
- Follow up timely on the referrals you receive and circle back with the person who provided the referral on the results and thank them for their efforts.
- Develop partners that are complementary and can act as a good referral source. Most companies are looking for additional ways to add value for their customers.
- And finally, remember the old saying, "you have to give to get." The theory of reciprocity is very real, and when you provide referrals, people are more inclined to reciprocate and provide them to you.
“A Marketshare report notes that word-of-mouth can improve marketing effectiveness by as much as 54%. Businesses using referrals as part of their regular marketing see conversion rates up to 70% higher, and they also report a 69% faster close time.”
Referrals: the highest compliment you can be given.
A referral may be the highest compliment a customer can give your business. That said, we must treat referrals with the utmost respect and professionalism. It is essential to make it easy for the prospect to say no if the fit is not right. But you can always ask if they know of someone else that might be a good fit and while you are at it, ask them how you can help them build their business and what type of referrals would be best for them. I genuinely believe that every relationship is powerful if we look for ways to help each other and nurture it over time.
Next time I will share the elements of our referral strategy that I helped develop.
Until then, happy selling and working on getting those referrals!
Yours in growth, Alan
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