Building Your Business Through Referrals: A Complete Guide
Referrals are one of the most lucrative and reliable ways to create new business. If you want to gain exposure to potential clients who are already in the market for your services, or who you already have an important relationship with, referral marketing is your best source.
Many business owners understand the power of referrals and referral sources but aren’t sure where to start when attempting to develop a profitable referral program. Here is the complete guide to building a referral system that’s effective and income-producing for your business.
Show off your business’ worth.
If you’re focused on turning every single client into a source of referrals for your business, the most important part will be the service and value your business can provide. An excellent transaction where the customer feels you went beyond what was expected is more likely to reap referrals from the client. Exceeding a customer’s expectations should not only make you feel great about your company’s performance, but it should also get you excited for the referrals to come.
You need to truly believe that your business is the best out there to convince potential referral sources. When you talk about your business to potential clients or referral sources, it’s also important to know how to explain the value your company provides with its service, and what makes you different from anyone else on the market. Having a few valid points to hit about the trustworthiness, value and client satisfaction of your business can make it more appealing for potential referrals. The smart people at Inc. recommend you “keep in mind the importance of word of mouth as you focus on making the buying process effective and enjoyable – before, during and even after the sale.”
“Satisfied clients are usually eager to connect you with prospects, but they have other priorities, too,” says The All Access Group CEO Kelli Richards. “Suggest a recommended time frame for making an email introduction, or ask if you can use the client’s name when reaching out to a prospect you both know. This takes the burden off of the client.”
Nurture current client relationships.
It’s not enough to display stellar customer service and smooth business transactions. Your current clients must also stay connected to you and your business, while feeling nurtured. A past client who still receives information about your business won’t forget about you and is more likely to refer potential clients your way.
While hounding your current clients for referrals is a definite faux pas, you should always gently remind them that you appreciate when they send friends, family members or colleagues your way. Offer them information, valuable resources and then interject your communication with a recap about your appreciation of customer referrals.
Here’s an excellent example of nurturing referrals from Srikumar Rao, Author, Happiness at Work:
“Let’s say you run a dog-boarding service. How about preparing an authoritative booklet on how to prevent separation anxiety in your dog? You describe the condition, the ill effect it has on the dog and — by extension — the owner’s family. You give helpful tips on how to ameliorate this, and, of course, these tips are implemented in your operation.
You offer to send the booklet to your satisfied client’s dog-owning friends. She can also select any three of them to receive a greatly discounted boarding package.”
Create new referral sources.
“Connecting synergistic business that will help your contacts is a key way in generating value for your connections,” advises Jason Bettinger, Founder of Ocean Friend. While current clients are easy sources for referrals, your referral seeking strategy should also include brand new sources.
Consider potential referral sources that are in the same type of industry but not offering the same services as your business. Setting up meetings with these potential sources to explain the value of your service and your unique business can help you to snag them as reliable resources for referral business. Don’t let it be a one-way street; figure out how you can help this business owner with referrals or other lucrative resources and connections.
If you’re ready to tap into the business you’re missing from a stream of referrals, it’s important to develop a program you can rely on. Follow these steps to start your successful referral program today.
If you liked this post, check out our Small Business Guide to Referrals.
About the Author
Jodie Shaw is The Alternative Board (TAB)’s Chief Marketing Officer. She brings over 20 years of B2B marketing and 10 years in franchising to the role. Prior to to her work with TAB, Jodie served as the CEO and Global Chief Marketing Officer of an international business coaching franchise, serving more than 50 countries.