Need a terrific, proven, low-cost way to build business when times
are tough? Finding more referrals and using the ones you have to better
advantage is a simple, cost-effective way to gain new business, and
regain old customers.
The folks who run my fitness club are masters at referral
marketing. They’re constantly running a promotion for referring new
members with discounts, free training or free stuff. Signs, banners,
stickers and mailers make it impossible to miss.
Millions of small business owners know the magic of referrals, which
offer instant credibility for what you sell. So why don’t more of us
use referrals effectively? Mainly because it’s harder than it looks.
For one thing, referrals come in different forms and flavors. If
someone merely provides you a name and email address, that’s low-grade
referral. But if a customer actively talks up your product or service,
sets up a meeting or brings the prospect in the door, that’s a Grade A
referral. Here are seven keys to getting more and better referrals:
1. Implement a referral-generation plan: Referrals
aren’t automatic. Some business owners assume that a great product or
terrific customer service will generate referrals by default. Not so.
You have to learn to ask, and make sure employees are on board as well.
Don’t be shy. Most customers are open to being asked for referrals.
Some even appreciate the opportunity to tell friends, family and
associates about something good they’ve discovered.
A word of caution: The worst time to ask for a referral is at the
cash register or when you present a bill. Look for opportunities
earlier or later in the process when customers are more receptive. There’s really no predetermined time to ask. Do it whenever
opportunities arise.
2. Provide some ammunition: Don’t ask customers to
recommend you to others without offering them some backup. It can be as
simple as a supply of your business cards, or a link to a special page
on your website. Or it could be a brochure, your latest newsletter or
some other type of printed material that describes what you do and can
reinforce the referral.
3. Offer incentives: The type of incentive you
offer must fit with the kind of business you run. It could be a
discount, service credits, an upgrade, a free item or some other
trigger that will entice clients to provide referrals. Don’t be afraid
to test offers to find out what works best.
Communicate details of your referral program to your best customers
through whatever means you have available, including a blog,
newsletter, email or customer mailings. And be sure to thank customers
when they make referrals.
4. Get the right information: When asking for
referrals, consider using a form, checklist or web-based system that
requests details that will make the referral more valuable. A simple
name and number isn’t really a referral at all. It’s just a lead.
At the other end of the spectrum are referrals where the customer
actually facilitates a meeting, visit or purchase by the referred
person, in person, by email or otherwise. This makes the customer an
active agent on your behalf.
Between these two extremes are referrals where the customer
authorizes you to use their name when contacting somebody, a letter
note or email from the customer to the referred person, or an
introductory call.
5. Target your most influential customers: If
resources are limited, consider seeking referrals only from your most
influential customers. These might not actually be your best
customers, but they are the people whose opinions would carry the most
weight with other people in your industry, community or customer base.
By targeting these influencers, you avoid spreading yourself too thin
or generating weak referrals.
6. Target related businesses: The health care
profession is one of the most adept at fostering referrals between
complementary disciplines - specialists, imaging services, physical
therapists, medical equipment suppliers and others. Consider the same
strategy yourself. Contact businesses that provide complementary
services to your own and ask for referrals.
7. Build your relationships: This takes time, but
it’s critical because many of your most influential customers won’t
provide referrals until you gain their complete trust. You’ll want to
treat each customer contact as if it’s critical to your next referral.
Through each sales, marketing or customer service “touch” you are
building a foundation of trust that that will one day lead to a
valuable referral.
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