Everybody who has worked in sales has heard of that one superstar in their industry who absolutely kills it through referral business. In fact, it’s unlikely that a top performer doesn’t derive a significant portion of their business from referrals. But cracking the referral code definitely isn’t as easy as it seems. For one thing, it usually take years to build up an organic base of referrals, so if you’re in a hurry to make things happen, like the majority of salespeople, you have to come up with more immediate solutions.
Despite referral business being one of the most valuable lead sources because it converts at a higher rate and technically costs your company nothing in advertising spend, it’s also the one most overlooked because it seems like something that’s difficult to control. While there might not be as direct a path to getting referrals as there is on paid advertising, for instance, here are some things you can do to help drive more referral business:
1. Make it a requirement to ask for referrals
One of the biggest reasons why salespeople don’t get referrals is because it’s not a part of their sales process. If you incorporate it as part of your other activities, then you’ll never forget or neglect to ask for referrals. Figure out when the best time to ask is (in conjunction with your sales process) and always follow through. You’ll want to make sure that you’re asking at the appropriate time, and not too early or too late in the transaction. A great time is right after the deal is closed and the prospect is satisfied.
2. Ask prospects to become a customer reference for you
Nearly every salesperson has at least one customer who loves them and their company. These are the perfect people to recruit as a reference, assuming that they’re coherent and presentable (this is important because they will be helping you represent your business). Ask your “champion” whether they would be willing to serve as a reference for you. It’s highly unlikely they will turn you down, especially if they believe in you and in what you’re doing.
Now that you have a reference, you can not only use them as part of your pitch to new prospects, they will also be empowered to serve as a referral source for you. If you can recruit multiple people or companies to serve as references, you’ll start seeing the difference not only with your conversions, but also with new referral business from your biggest fans.
3. Have referral content readily available
One of the most challenging parts of asking for referral business is not having anything formal in place. You should not only have content (printout, landing page) created outlining your referral program to give to those people who you’re asking for referrals, but you should also take the time to create content that the referees can give to people outlining your offering. This way, every part of the referral process is covered by the appropriate collateral that will help make the process seamless.
4. Find ideal strategic partners
Just like in any other field, salespeople and companies need to always look for ways to work smarter. You have an ideal target customer out there. And there are other people or companies, who are not competitors of yours, who have that same target customer. You need to find ways to work with them to develop a referral relationship, whether it’s a quid pro quo or a compensated partnership. For instance, if your target market is advertising agencies, partner with consultants whose main clients are advertising agencies to develop a referral relationship. They will then help you sell your product after they have done the hard work of landing the client.
5. Make sure to act upon positive feedback
The absolute best time to ask for a referral is while your customer is complimenting you on how great of a job you did or how much they love your product. When you’re receiving positive feedback, always use the opportunity to suggest that if they’re very happy, it would be very helpful to you if they would be willing to refer you and your product to someone else they might know. Sure, this is a bit opportunistic while someone is telling you how great of a job you did, but if you can’t ask for referrals when someone is singing your praises, then you probably never will.