I personally love a referral and giving/receiving referrals are very much part of my marketing strategy. I like to make them where I can, and I like to receive them too. For many of us B2B small business owners, referrals (including WOM and intros) are the main way we grow and are the main source/lead source of new business. Would you agree?
According to Customergauge’s site – A study by the Harvard Business Review says 84% of all B2B sales begin with a referral.” And referred leads are up to 4x more likely to buy a product and have 16% higher lifetime account values on average compared to non-referred customers.
You cannot argue with these stats, surely? So, if you aren’t in the habit of making or receiving referrals or both, then do read on …
Marketing and referrals – what is it all about
What is a referral?
The Oxford dictionary definition of a referral “is an act of referring someone or something for consultation, review, or further action.”
Referrals may come about for many reasons eg a friend or colleague, or client is actively looking for a recommendation for a business or service, and you can make that referral/s if you know such a business. Sometimes it is more subtle than this as in you may be having a business chat with someone and it becomes apparent to you that they could benefit from a service or person, and you might suggest this to them and say I know just the person who can or who does ….
Why make referrals?
Quite simply, it is how business works and how businesses and the economy evolves and grows. Marketing and referrals. If you know someone or a service who would be a perfect fit for a client or colleague, why wouldn’t you refer?
For some this referring is second nature and for others, it doesn’t occur to them as much.
When two parties connect and work together for a successful outcome, then this is why you refer.
Don’t let your client or colleague or business be the best kept secret. As Bob Berg from the Go Giver book series says – “All things being equal, people will do business with and refer business to, those people they know, like and trust.” So by making a referral, then all parties win. One gets the solution they needed, and one gets a new customer.
And as Zuckerberg said – “A trusted referral is the holy grail of advertising.”
When you refer, and I know I feel this way, I feel pleased and warm and happy that I have made an intro, that I have connected two people who will both end up getting something they want and therefore it’s a win win all round. I feel like I have done my bit to help, even if it’s in this indirect way of a referral.
Maya Angelou: “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.”
Referring is better than someone googling what they need and may not getting a service or solution that is below par or too expensive or not to be trusted.
Is it ok to ask for a referral?
Yes!! It is and I do.
Most people you meet networking, most friends, most colleagues and most business owners do want to help each other but they often don’t know how. So if you directly ask for a referral to person xx or company type yy, then the person you are asking either will or won’t know someone/a business that fits. But if you don’t ask, you don’t get as the saying goes.
Some people pay for referrals by invoice or by way of a gift, a voucher, flowers, donations to charity and so on. This is up to you if you do this and as with everything marketing wise, there are pros and cons to consider.
If you want to make it easy to receive referrals, write up who you are looking for, how you can help, how you can receive intros eg your contact info, your discovery call or QR code etc, then as and when someone asks how can I help you or who would you like to be introduced to, you can send this easy copy and paste style doc.
When it comes to referring, the phrase “It’s who you know, not what you know,” comes into play with referrals. Would you agree?
Some business owners are shy of asking for referrals, as well as testimonials and quotes. Why is this? If you have done a great job and the client is satisfied, then why not ask. They are very likely to say yes as they will appreciate the work you did and will probably be ok to publicly thank you and help you further by making a referral.
As with most things, there is a time and place to ask. At the end of a project that went well is a good time and prior to a contract renewal can also be a good time.
Marketing and referrals
If you are in the good habit of researching your customers and interviewing them/surveying them, why not take this one step further and approach the satisfied ones and ask for a referral.
Customer research is key, as is market research.
It is of course up to you who you ask, but this may be a good starting point.
For support interviewing and surveying customers, on mass or one by one, check out
Remeny Armitage Royle https://www.brilliantandhuman.com/ In a guest blog with Pinpoint, Remeny said “By auditing or simply by listening to your clients to understand their needs, wants and challenges, you can feed this into your own business.” Read the blog here https://pinpointmarketingconsultancy.co.uk/getting-going-or-getting-ready/ This could be pertinent for making and receiving referrals.
And you can also talk to Amanda Claesens for customer research https://acemr.co.uk/about
Referrals are part of your marketing strategy
Referral marketing is a marketing strategy that many SME’s I know use. Such a strategy can grow your customer base through word of mouth (WOM) recommendations by empowering and encouraging your existing customers and contacts to spread the word about you within their networks. It turns your customers into reliable advocates for your brand. They are doing your marketing for you, as well as your marketing, which doubles up the efforts.
Some businesses I know have built their business on asking for and receiving referrals.
Making referrals work for you
What is your referral rate? Often referred to as a percentage, what’s yours? For example, let’s say that your referral rate is 1% this means that 1 in every 100 purchases comes from your referral programme or referral scheme.
Seth Godin said, “the secret to marketing is no secret at all: “word of mouth is all that matters.”
So when you are creating your marketing strategy and plan and factoring what marketing channels to include and incorporate, consider referrals and WOM as two of the channels for new business and for more upselling and cross selling too. Most of my new business or repeat business comes from referrals and intros, as well as LinkedIn and networking.
What next?
If you want expertise in this area of referrals, partnerships and programmes, please do contact/connect with Dave Plunkett of the Collaboration Junkie https://www.collaborationjunkie.com/
As he says on his website – “In a survey of over 100 business owners 62% said that referrals was THE key part of their lead generation, and a further 29% said it was in the mix, and wanted to grow. That’s more than 9 out of 10 business owners seeing it as a vital branch of their growth strategy.
But very few had an actual strategy behind it.”
Dave is your man for workshops for the theory but the actual hands on and how to help as well. He comes highly recommended! Visit his site for info, webinar dates and much more https://www.collaborationjunkie.com/referrals
