According to Wikipedia, “Referral marketing is the method of promoting products or services to new customers through referrals, usually word of mouth. Such referrals often happen spontaneously but businesses can influence this through appropriate strategies”.
This information is designed to give you insight into just what you need to do to make sure your business is ‘refer-able.’ That is, to make sure your business is the kind of business that people can and will happily refer.
The kind of business people actually enjoy dealing with. The kind of business that really adds value, that supports and appreciates its customers.
You may find you’re already doing some of the ideas outlined here. This information, then, could be a good way to make sure your team understands the importance of doing those things well.
Or you might find your business lacking in some sure-fire, refer-able ideas to ensure that people are talking about your business in a positive way.
1. Put Simply – Do A Great Job
Be great at what you do. Keep your promises. Deliver. Treat your customers as you would like to be treated as a customer. Better yet, show them the care and respect you might show a very close friend or a family member.
2. Referral Marketing Requires That You Consistently Exceed Your Customers’ Expectations
Again, put simply—do a great job.
As you’d expect, you must at least meet your clients’ expectations to continue to be in business. Thus, it makes sense that to be able to count on your clients as referrers of new business, those customers need to be delighted with what you’re doing for them and the way you do it.
Because of that, you need to find ways to constantly differentiate yourself and add value..
Because all businesses aren’t meeting their customers’ needs—certainly there are very few that exceed those needs—a percentage of the market is always on the ‘lookout,’ if you like, for a new supplier.
For example, a new hairdresser, doctor, supermarket, butcher, baker, or candlestick maker! This group is in the market for your products or services and is particularly prime for responding to referral systems.
As such, you always need to be looking for ways to make yourself known to this searching element.
Conversely, if you’re not meeting your customers’ needs or ideally exceeding them, your customers could be primed for your competitors in the same way!
And if you can find ways to exceed your customers’ expectations, you’ll create a band of hugely loyal customers within your market, who’ll be more than happy to talk about you and refer people to you.
3. Develop A Relationship With Your Clients That Goes Over And Above Just Selling
Use a database to effectively capture and retain the information you need for a given client. Much of the information will relate to the work.
But the extra mile comes when you can recall the name of the spouse, children’s names, hobbies, birthdays, past exploits, and so on. That is where you can go beyond the norm.
Another way you can do this is to incorporate a guarantee or a Unique Core Differentiator into what you do.
Remember – your product and service have got to be great.
But it’s the little things that you do that will really make the difference to your clients. And it can be the little things that you don’t do (that someone else does) that will cost you good clients.
This is true for any business. It’s just as important for a metal fabricator, product wholesaler, retailer, or backhoe operator.
4. Reassure Your Clients About Their Decision To Buy
Post-purchase dissonance—that is, second thoughts about the purchase—is common. It probably happens more than we know. (Post-purchase dissonance will be reviewed in more detail in our series of Special Articles.)
Most people will analyse a decision after they make it, wondering if it was the right choice, did they do the right thing, choose the right colour, buy at the right price, right everything and anything.
Thus a system to give them confidence in you and your products or services will really add to the WOW factor. It will help build that bridge of confidence you need for people to refer work your way.
Look at your product or service. What concerns are your clients likely to have that you could quell for them up front?
For example, could you make a follow-up call a week or so later to check that they’re happy with everything or to remind them to call if they have any problems?
Doing this sort of follow-up makes the customer feel more confident in their choice to go with you and your business. You then begin to form a relationship over and above being seen as just ‘the salesperson.’
5. Deliver What Your Client Thinks You Promised
So often, we let ourselves and our clients down by not gaining a clear understanding from the outset of what they really want, what they will invest, and how we’re going to make, provide, or deliver a matching product or service.
This area is critical to establish good, ongoing working relationships with clients. Working relationships that mean you’ll win referrals.
In some industries, a ‘Commitment Statement’ or even a ‘Commitment Contract’ is a good tool. This is a statement of what you agree to do for the customer and what they agree to do as part of your joint working relationship. Another version of this idea is to do a ‘Team Commitment,’ where your team documents their various commitments to your customers.
All the things we’ve discussed so far have been preparatory steps toward getting referrals from your happy customers.
What we’re going to look at next are some ideas about what you could do to stimulate more proactive referrals – sort of like turning on the marketing tap for your business. We’ll call them High-Leverage Referral Business Builders.
6. Contact Customers Regularly
Implement a system whereby you’re in regular contact with your clients—send them a newsletter, a tape, a sample of a product, and so on. What is ‘regular’ will change depending on your industry, but you need to do something.
It will be a system that is independent of a team member’s (or YOU) remembering to do it. You must have a good database set up (and maintained) to make a contact system work.
Some ideas on what you could do:
- Client-only events
- Special offers
- Birthday/purchase anniversary cards
- Holiday party
- Occasional articles on areas of interest or hints and tips
This keeps you on their mind and means that your material, whether it’s a special report, tape, or product is often on their desk when associates, colleagues, or friends visit—and could become the topic of conversation. In fact, you could have your customers pass some of these tools on to others.
7. At The Very Least, Always Thank Your Customers For Sending People To You
It’s important to offer a tangible reward or benefit for referring people to you. As you saw, this could simply be a matter of positioning referrals as a way to grow your business and therefore be able to offer more and better services.
Whichever way you go with that, always take the time to say thank you.
You don’t have to resort to expensive gifts, finder’s fees, and so on to thank them. In fact, your clients might start to expect it, which might not be the positioning you want. (In some industries, spotter’s fees are necessary. In referrals marketing, it’s important to cover that fee in your pricing.)
A few neat ideas: a bottle of wine or a ticket to an event you know your client is interested in, for example, a sporting event, movie tickets, or theatre. A bunch of beautiful flowers to a lady referrer or to a whole team in an office. Depending on the ‘lifetime value’ of your clients you could even afford to take the regular referrers out to dinner.
Just one other point: It’s important not to send a thank you gift for every referral. This tends to cheapen your thank you and becomes a little less impressive to the referrer. Rather, keep track of the people they do send you and thank them verbally each time. Later on, send them a gift to thank them for the several people they sent.
8. When You’ve Done A Great Job And Your Customers Tell You So—ASK
When people take the time to tell you what a good job you’ve done on their tax, garden, cleaning, car, thank them and ask. Ask for just one referral.
You could do so by simply saying something like this:
‘That’s great [Client Name], it’s really good to hear that. Thank you. I’m glad it’s gone well for you. You know, [Client Name], there is one thing that might mean we could provide you with even better products and services, and that is to grow this business. Referrals are often a great way to do that. And given what you’ve just said, [Client Name], can you think of anyone you might know who is similar to you and could need a similar [product or service]? Someone you would be happy to recommend to us?’
This works well because it means they have an opportunity to back up their words, to show you they mean it. And people are very often happy to do that.
The upshot is, if someone is that happy with your product or service, most will have already talked with someone else, about you and your business and will usually say, ‘Actually there is. I was talking with a colleague of mine a couple of weeks ago about what we were doing together. I’m sure you could give him a call.’
The worst-case scenario here is that the client will say, ‘Not off the top of my head, but I’ll think about it over the next couple of days.’ And then you’d simply make a note to call them back in a few weeks to gather the names and details of those people.
Often by asking this way, you will have planted a seed. It’s more than likely that during the following week or weeks, that person will run into someone who would suddenly appear to be appropriate.
Develop a simple script to thank them and let them know that you’d always welcome any friend of theirs to your business. (It could also be a great opportunity to capture a testimonial! See ‘The Power of Testimonials’ to find out how).
Use the script you feel most comfortable with, or take some time to develop a script that gets the same message across in your own words.
As you work through this, remember one critical point: Your customers won’t be uncomfortable with your request. However, the first couple of times you do ask your customers, you might be!
For some people, it can just take a little getting used to. The solution is to try it and see how well it really does work.
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