According to a survey conducted by SBA (Small Business
Administration) 60 out a 100 small business owners claim
that over 60% of their new business comes from referrals.
But only a handful of professionals can clearly pinpoint
where their referrals come from and the exact process they
use to turn them into paying clients.
Amazingly – when it comes to referral marketing - majority
of entrepreneurs seem to rely on luck! Ouch – this is not
exactly the best formula for business success!
When asked about how they turn referrals into clients, most
professionals have a deer-caught-in-the-headlights, puzzled
look on their faces and keep quiet.
The First Two Key Success Factors of Referral Marketing
Those who truly can sleep peacefully at night knowing their
referral generating process is working with the predictable
precision of a Swiss banking system understand the power of
using FREQUENCY of EXPOSURE.
To best illustrate this, let's look at how two consultants
handle their referrals.
At first glance John and Steve have virtually identical
Businesses:
>> Both are management consultants working with small and
mid-size corporate clients
>> In the last year they both added executive coaching to
their product mix
>> They both are excellent at what they do and have
stellar reputation among their customers and peers
But there is a difference…
How Is John Getting 5 Times More Referrals?
John gets almost five times as many referrals as Steve, and
he turns an astounding 95% of them into new clients.
How, you ask? See if you can spot a difference...
Steve's name occasionally pops up in conversations his
clients have with their business associates. Since he does
a good job people are often intrigued by the results he
creates for his clients. They ask for his contact info and
call him to inquire about his services.
Those calls typically lead to an appointment.
But in terms of frequency of exposure Steve's potential
clients might hear his marketing message only twice before
the meeting: when they initially get his information from a
colleague, and again during the initial phone conversation.
Here Is What John Does Differently:
At first glance, John's situation isn't much different. His
name comes up in conversations where he's praised for his
great work. His contact information is passed on, and he
too gets an inquiring phone call leading to an appointment
with a prospective client.
But that's pretty much where the similarity ends.
Immediately after the call, John sends out a hand-written
card saying "thank you for interest in my services. I'm
looking forward to our meeting."
John makes an additional smart move - he sends another hand
-written thank-you card and a small gift (like a Starbucks
gift card) to the person who gave him the referral.
He does it because he understands the best way to develop a
habit is to reward it in the first place (remember Pavlov's
dog experiment?) so he tries to make his referral sources
feel good about mentioning his name. And it works – they
talk about him more often!
The following day, John sends out a small package with
POSITIONING MATERIALS: a welcome letter, an article
relevant to prospect's situation, his short self-published
book, and an audio CD.
This allows the potential client to "sample" John's
expertise on the subject. It also builds trust, increases
prospect's appetite for his services, and position him as
an authority. Now he'll be treated as a trusted advisor and
not just another salesman trying to close a deal.
Incidentally, John knows that many of his best prospects
won't have time to fully review those materials. He also
knows it really doesn't matter. All he wants is to see his
"stuff" sitting on prospect's desk when he walks into their
office.
But he's still not done. A couple of days before the
scheduled meeting he calls his potential client to briefly
confirm the meeting objectives, time and place.
After the meeting, John immediately sends out another
handwritten "pleasure meeting you/thank you" card.
Higher Frequency Leads to Greater Familiarity
Visibility equals credibility. And frequency translates
into familiarity. Don't believe me? Just ask yourself how
many people you "feel like you know" because you see them
or hear from (about) them frequently... Point made!
So let's now review how many times John's referrals are
exposed to his marketing message:
1. When they first are referred to him in a conversation
with a business colleague.
2. When they call him to inquire about his services.
3. When they get his handwritten "looking forward to
meeting you" card.
4. When they get his Positioning Packet. (And again when
they make time to look through the materials he sends out)
5. When he makes the reminder call two days before the
meeting.
6. During the first meeting.
Notice, that at this point prospect has been exposed to
John's marketing message five times – comparing to only
two times in Steve's process. That's a 150% increase in
frequency of exposure!
7. When they get the handwritten "thank you" card after
the meeting.
Now, that they "know" John so well, they TUST him enough to
start doing business with him. (Can you say KA-CHING!)
Plus, sending a thank-you card and a small gift to the
referral source proves helpful as well. Motivated by his
small gesture of appreciation, John's referral sources now
take a more active part in the process, inquire about how
things are going, and frequently offer additional help.
Clear Expectations and Education Lead to More Referrals
There is one other thing that separates John from Steve.
Hi understands that his clients want to give him referrals
but often don't know how to do this. So he takes the time
to educate them and makes it easy for them to "give him
away as a gift"!
Say what?!
He hands each new client a sample of a great Attraction
Tool (most likely an audio program or a book), and informs
them that he'll gladly send this Attraction Tool to any of
his new client's business associates at absolutely no cost
and no obligation – all they have to do is ask for it.
He might even hand the new client a few postcards promoting
the Attraction Tool and encourage him to send it to their
associates.
Why bother? Because by sharing this information John's new
clients are actually helping their colleagues. And it's
easier and less awkward to send out a postcard and to share
a resource, than to hand over names of business friends.
All this increases the chances of John's name coming up in
many casual conversations.
Here Is the Final Key Success Factor to Referral Success
I can already hear you whining, "but that's too much work,
I can't do that in my business", etc., etc. And you are
right – but consider the upside: getting more clients!
And the key is to SYSTEMIZE, AUTOMATE, and DELEGATE.
Do you have to do this? Hey, it's your business – you don't
have to do anything you don't want!
But the fact is – frequency builds familiarity. Familiarity
builds trust. And we all do business with people we know,
like and trust.
So you decide if getting more referrals and turning them
into paying clients is worth adding a few easy steps to
your marketing system.
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The author, Adam Urbanski, teaches service professionals
and business owners how to develop better marketing
strategies to increase sales and profits. His website
offers more how-to articles and free tips to create a
winning marketing action plan at
http://www.themarketingmentors.com
