Why Referral Business Is So Valuable
Why Referral Business Is So Valuable
1. Customers[1] who refer are more likely to stay with you and as a result, spend more, adding to their lifetime value
2. Referrals are more likely to become customers. Why? Because they have been recommended to you by someone they trust and who in turn, trusts you.
3. Referrals who become clients are likely in turn to generate referrals because they understand the process.
What’s the best way to generate referrals?
You have to earn them! You have to treat your customers as friends. The result is that they will want to introduce you to people they know who in turn can do business with you.
It’s back to that Trust thing again isn’t it? By showing you care about them and about their lives, your level of trusts increase. Remember the three things Warren Buffet is reputed to think about before he does business with someone?
1. Do I like the?
2. Do I respect them?
3. Can I trust them?
By taking the time to develop relationships, trust increases, as does the likelihood of referrals.
By delivering a high standard of service in an appropriate professional environment or fashion, you are demonstrating your professional competence. The combination of this and your capacity to develop relationship will in turn earn you the right to ask for referrals.
I guarantee that if you did nothing else but began asking your customers for referrals on a regular basis you would instantly see an increase in referrals coming into your business.
The best time to ask for a referral is when a customer gives you a compliment or expresses any kind of gratitude towards you or your business. Tell them that your purpose in asking is to build your business. There is absolutely nothing wrong with that.
In fact, a client who really likes you will actually feel honoured that you have asked for their help.
Don't be afraid to tell your clients whom they should be thinking of as referrals (i.e. people under a lot of stress, people who are health conscious, people in pain) – be specific. You get what you ask for!
OK, so now you’ve gained sufficient trust and respect to ask for referrals, what do you do when you start getting them?
Simple. Make a fuss of them by means of reward and recognition. Just as with children and dogs, rewarding good behaviour makes certain that the behaviour is rewarded!
Do it publicly, too. Create a Referral Recognition wall in your reception area. Put the names of people you’ve rewarded up there. Run a referral incentive program that rewards more for more referrals.
Remember we’re talking about the cost of client acquisition and retention here. Far better to pay for the client after they’ve spent than to gamble on attracting them!
With a Reward for Referral program, your costs are a fixed item for every new client, too, making budgeting far easier.
Why Referral Business Is So Valuable - To learn more about this author, visit James Yuille's Website.
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Here are three reasons why referrals are so valuable…
1. Customers[1] who refer are more likely to stay with you and as a result, spend more, adding to their lifetime value
2. Referrals are more likely to become customers. Why? Because they have been recommended to you by someone they trust and who in turn, trusts you.
3. Referrals who become clients are likely in turn to generate referrals because they understand the process.
What’s the best way to generate referrals?
You have to earn them! You have to treat your customers as friends. The result is that they will want to introduce you to people they know who in turn can do business with you.
It’s back to that Trust thing again isn’t it? By showing you care about them and about their lives, your level of trusts increase. Remember the three things Warren Buffet is reputed to think about before he does business with someone?
1. Do I like the?
2. Do I respect them?
3. Can I trust them?
By taking the time to develop relationships, trust increases, as does the likelihood of referrals.
By delivering a high standard of service in an appropriate professional environment or fashion, you are demonstrating your professional competence. The combination of this and your capacity to develop relationship will in turn earn you the right to ask for referrals.
I guarantee that if you did nothing else but began asking your customers for referrals on a regular basis you would instantly see an increase in referrals coming into your business.
The best time to ask for a referral is when a customer gives you a compliment or expresses any kind of gratitude towards you or your business. Tell them that your purpose in asking is to build your business. There is absolutely nothing wrong with that.
In fact, a client who really likes you will actually feel honoured that you have asked for their help.
Don't be afraid to tell your clients whom they should be thinking of as referrals (i.e. people under a lot of stress, people who are health conscious, people in pain) – be specific. You get what you ask for!
OK, so now you’ve gained sufficient trust and respect to ask for referrals, what do you do when you start getting them?
Simple. Make a fuss of them by means of reward and recognition. Just as with children and dogs, rewarding good behaviour makes certain that the behaviour is rewarded!
Do it publicly, too. Create a Referral Recognition wall in your reception area. Put the names of people you’ve rewarded up there. Run a referral incentive program that rewards more for more referrals.
Remember we’re talking about the cost of client acquisition and retention here. Far better to pay for the client after they’ve spent than to gamble on attracting them!
With a Reward for Referral program, your costs are a fixed item for every new client, too, making budgeting far easier.
Why Referral Business Is So Valuable - To learn more about this author, visit James Yuille's Website.
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Joe DagerJoe Dager is President of Business901, a progressive coaching company providing no-nonsense direction in areas such as Lean Six Sigma Marketing and organized referral marketing. What others say: In the past 20 years, Joe and I have collaborated on many difficult issues. Joe’s ability to combine his expertise with “out of the box” thinking is unsurpassed. He has always delivered quickly, cost effectively and with ingenuity. A brilliant mind that is always a pleasure to work with.” - James R. If you want to learn more about Business901, start a conversation with us. We can be found @ Web/Blog: Business901.com Web/Blog: FundingYourNonprofit.com LinkedIn Profile Follow me on Twitter - Visit Joe Dager's Website |
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David BarrDavid Barr is the President of Venture Opportunities, Inc. David has been a professional business broker/intermediary since 1980 focusing on General Business Brokerage and Mergers and Acquisitions representing client transaction value from $400,000 to $20,000,000. Mr. Barr has handled the sale of over four hundred and fifty companies. David earned a university degree from the State University of New York majoring in economics and business. David holds the Mergers and Acquisition Master Intermediary and the Certified Business Intermediary designations from the International Business Brokers Association. He is also a Senior Business Analyst and a Texas licensed Real Estate Agent. For more information about David and Venture Opportunities, visit www.bizdealmaker.com. - Visit David Barr's Website |
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Anne BarrAnne Barr has over 26 years experience in sales and marketing, six years as a franchisee. She has assisted over 367 business owners and purchasers to achieve their goals in career change, transition and exit strategy. She holds the designation of Certified Franchise Executive from the International Franchise Association, Certified Business Intermediary from the International Business Brokers Association and Board Certified Broker from the Texas Association of Business Brokers. Anne is active in professional organizations, networking groups and volunteers for non-profit entities. As owner/operator of four successful businesses, Anne has proven people skills and enjoys helping clients find the right "fit" in business ownership. Visit www.FranchiseOpportunitySpecialist.com for more information about me and my company. - Visit Anne Barr's Website |
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David AchesonDavid Acheson is the founder of DCJA Consultancy. DCJA Consultancy is a management consultancy business specialising in B2B sales consultancy. They offer bespoke and packaged sales consultancy including Sales Optimisation Review, Interim Sales Management, Sales & Marketing Review, 1:1 Sales & Management Staff Analysis, Management Training, Solution Sales Training, Creation of New Pay Plan, KPI's, run Customer Feedback Campaigns, assist with Recruitment, Coaching, Appraisals and set up Strategic Marketing Campaigns. David spent his early career in accountancy and then moved into sales in 1982, working in Office Equipment, IT, Advertising, Training, Outsourcing and Consultancy. He has held many Senior Positions in SMBs and Global Organisations including Head of Sales Operations & Head of Business Development. His knowledge, skills and great experience of the Sales Industry has led to David making keynote speeches and running educational sessions to key businesses through organisations including The Chamber of Commerce and Business Link. - Visit David Acheson's Website |
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Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
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