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How to generate referrals

Guest post by: Trent Leyshan

Article Overview: Having been a fervent student of ‘selling' for most of my adult life, one thing is for sure, nothing excites me more at the front end of the sales process than a referral. Hot, warm or cold, I dont mind, so long as there's a need or desire I'm qualified to fulfil. And if someone goes to the trouble of recommending me to another, I dont take that lightly, - I celebrate it!

How to generate referrals

Having been a fervent student of ‘selling' for most of my adult life, one thing is for sure, nothing excites me more at the front end of the sales process than a referral.

Hot, warm or cold, I dont mind, so long as there's a need or desire I'm qualified to fulfil. And if someone goes to the trouble of recommending me to another, I dont take that lightly, - I celebrate it!

The thing to understand about ‘referrals' is they dont just manifest by themselves. Someone has to initiate the referral and have a good reason. For many customers they simply do not feel the need or inclination to refer you, nor is there a compelling enough reason to do so.

One of the best measures of the quality of your work is your customer's willingness to buy-again and refer their friends.

This should be your ultimate outcome with each sale. One way to generate referrals is to simply do a great job and go beyond the mandatory.

Like or loath him, Gordon Ramsay rates a restaurant by a distinguishing trait, "Will the customer F-ing! come back?" Despite Gordon's foul mouthed antics, I tend to agree with him. But inspiring the customer to come back is one thing - asking them to refer you business is quite another.

Asking for a referral from a happy customer can sometimes take the shine off their opinion of you, because it usually demonstrates you are interested in other customers, which can come across as a tad transactional, so handle with care.

In my personal experience, asking for referrals is not the most effective way to get them, there is a better way - give referrals to others! If you want to more referrals start giving more to those around you. Create a circle of influence with like-minded businesses and handball them opportunities.

From my experience this is the best way to generate referrals.

Helping others is not only powerful in itself- it does come back to you many times over. Maybe not instantly, but I can guarantee the person you referred the customer to will be thinking about you and should the opportunity present itself this person will sell you.

Actions to generate quality referrals:

• Create strategic alliances with synergistic companies;

• Only refer people to companies you believe in;

• Reward programs can be effective, but sometimes considered contrived, I prefer to make rewards unique to my referrer which means taking a genuine interest in them;

• Learn more about the companies around you, so you can more effectively refer them business;

• At the very least thank your referrer!

(You will be surprised at how often this doesn't happen. Madness!)

Some of the most valuable relationships I have in business are with companies that I refer business to and who refer business to me. In some instances, I have been in a meeting with a potential customer and been thinking more about how I can plug someone that I know in over my own business interests.

Develop strategies to be a valuable connector and referrer to those around and you and you will be amazed at the amount of business that comes back to you!

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Article Tags: sales training



Related Forum Posts
Customer Service - Great customer service, referrals and positive word of mouth are effective ways to promote your business. I've found that educating my customers about the sort of referrals I want is very valuable. While this sort of promotion can be very effective, it is only one type of advertising that should be done. Of course, the amount of promotion that you need to do depends on the amount of business you need to generate. Chris
20% increase - One of my businesses uses a system to help business owners manage customer relationships and encourage more referrals. I'm finding that this economy is making business owners take a second look at their business and it's assets (aka customers) to see how they can leverage them. Make those Customers (one-time sale) into Clients (repeat sales). I'm finding them more open to having this discussion with me and the results are speaking for itself. Everyone I've worked with so far has seen at least a 20% increase in sales or referrals within 4-6 months all done by managing an existing relationship.
Re: If Twitter works - which are your benefits? - The problem with Twitter now is that there's too much noise. I think it's a good tool to generate quality traffic if used properly by webmasters and business owners. You can generate a lot of buzz with an update. But when you spam your followers, they tend to tune out rather quickly.
Forum Referral Program - Hi Evan Have you ever thought about inserting a "Referred by" field into the forum sign up process? This field could help track the sign ups that have resulted directly from a forum member inviting someone to join. Under the user profiles you could also include a "Number of referrals" field that shows how many members a particular user has referred to the forum. You could then run a competition every month for the highest number of referrals but then again you would prefer quality not quantity. What do you think?
Re: Marketing to Wealthy Consumers - Oh yes... good point Shri. We do have several joint venture opportunities available. When we got started many years back we focused on designers and decorators and floor covering stores. Of course, they are generally making the sale, so the client is theirs. Generally we have to compromise on pricing if we work with these clients, which is ok if there's enough work available... nowadays we like to deal direct with client if possible. We're refining a previous strategy to get referrals from hardwood floor installers. As soon as the floor is installed, imagine how easy it is for these guys to hand out our card and suggest a custom rug to compliment their new floors. Any ideas on HOW to generate good leads from a hardwood vendor? Currently our plan is to send out custom postcards with an offering... Maybe offer 5% referral fee?


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