If you hate cold calling, and have at least a few customers, then this is the article for you.
Every salesperson has heard about how word-of-mouth marketing is the best form of advertising. The only problem is that most customers don’t tell their friends fast enough to keep you in business. Asking for referrals is a great way of getting lots more customers. The only problem with referrals is that 1) You forget to ask or 2) it is scary to ask for referrals.
There are just a few steps to asking for referrals. Here they are:
1. Take great care of your customers.
2. Create loyal or fanatical customers out of them. This is done by going out of your way to treat them right and giving them more than they expect.
3. Use surveys to help them understand you really care about their experience with you and your company.
4. Put together a referral reward program. This would reward your customers for the referrals. Make it something they would want to receive, rather than something you want to give.
5. Now comes the tricky part – Ask for the referral. This can be done in several ways.
Asking for the referral before customers are ready to give it to you is bad for your business. You can ask for the referral on the first contact if you do it right though.
I was once challenged to ask for a referral the first time I had an appointment with my clients. As part of my presentation, I pulled out a sheet that had a list of the types of businesses that I was targeting. I didn’t mention it when I pulled it out. I put it where the prospect would see it, though. This list simply said “Referral form” at the top. The list ran down the left side of the paper with blank lines on the right side of the paper. Ninety percent of the time, I didn’t have to ask for the referral because they saw the sheet that I pulled out earlier, and by the time I got to it, they were already preparing themselves to give me some referrals.
A few clients didn’t feel comfortable in giving me a referral right then because they hadn’t seen how we were going to perform. I found that I could get a sense of who wouldn’t give me referrals by the time it came time for me to ask. I instead asked if I could leave the form with them and if, when they felt we had earned their business, they would give me a lead or two that I could talk to. I even asked most of them to give their leads a call before I called to help with the lead.
I had a list of 40 businesses categories listed on that sheet. I found that some clients asked if I could return another day and when I did, they would have not just put referrals on the list but would have called them too.
In my newspaper business, this worked really well.
I would ask who else they would love to see in our newspapers. What businesses would they feel would look great next to their advertising? I had an attorney call several friends while I was there to get them in the newspaper next to him. They all stayed for a long time.
The Referral Reward System
This works for many businesses for both B2B or B2C. The key is finding the right thing to give as a reward.
With my newspapers, I tried two types of rewards for B2B. This included giving them a free ad when their referral signed up for 6x or more. I had one business owner give me a referral for two years straight each month. She paid for her ad in our newspaper for the first year and didn’t have to pay again for two more years. I picked up 24 new customers because of her.
Another successful program was when I gave a personal item that they could use when someone signed up. If you’re not working with the owner, it’s better to give something like movie tickets or dinner gift cards. The owner will appreciate the free ad but an employee wants something that will benefit him/her and not the business.
Sometimes coupons or a free item are great for getting referrals.
One caution though – If you are using a reward system, you MUST ask the new customer who you can thank for referring them. Then be sure to send them a thank you note with their reward. Then they will refer more! It’s like magic!
Email Referral Program
Many customers mean to let others know about great service and great products that they have purchased. They just forget about it until someone mentions something about the product or service. One of the best ways to remind them to refer you is to send them an email request for a referral.
One of my customers has received over 35 referrals in the first 60 days of implementing this. They are delighted. Some came from the form being sent back and others came in because friends had referred them. Before this program, they were averaging 1-2 referrals per month.
I have started using a drip marketing email program that is designed to build customer loyalty and get me more referrals. There are also other benefits to this program. In the next newsletter, I’ll cover this more.
The best part about the email referral program is that it works automatically and asks everyone for a referral.
You have to start by making sure that your clients know that you are going to ask for referrals. When you thank them for their business, let them know that you will be asking for a referral and that they should refer you too. (You don’t ask then; you’re preparing them for later).
In the referral email, be sure to let your clients know that you appreciate your business and that the biggest form of flattery for you is to receive a referral. As mentioned above, you may get referral forms back or you may find more referrals coming from them telling their friends and family directly.
How do you know if these new customers are referrals?
I thought you’d never ask! Create a program that rewards both the referral and the referrer. Some TV service companies offer this. You get $50 for referring and your friend that you refer gets $50 as well.
Another option is you can print up referral cards for your customer to hand out. They can be the size of business cards and your customer can put their name or a control number on the card. It gives the new customer a discount and you know who gave you the recommendation.
Another popular way of doing this is a code that the customer can give out to a referral to get the special pricing or offer.
You can use a give-away or contest for this as well. Tickets to an event or dinner gift cards are always a hit.