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Feb
19

How to Develop a Steady Flow of Referrals

Here’s the fact: Unless you’re selling water in a desert during a marathon race, it’s challenging to sell any product or service today. The business climate is very competitive, most products are becoming commodities, so how do you find new sales leads or prospects to buy your products or services?

One answer—implement a referral program.   Ask most business owners or sales professionals how they get most of their business and they will probably say referrals or word of mouth. But how many businesses actually have a specific system or program to generate referrals or encourage positive word of mouth business? My guess is about 10%. Building your business on referrals is probably the most cost-effective, profitable way to build your business.

Bill Cates, author of Get More Referrals Now, states “To keep the flow of high-quality referrals coming, you must have a referral prospecting system”.  Most people prefer to find suppliers of goods and services through referrals so why not take advantage of this natural tendency.

If you do not have a strategy to capture referrals then you’re leaving your success up to chance. Every business owner or sales professional should be going after referral business in a systematic way, but most rely on hope and luck to get referrals.

How do you motivate your customers or clients to give you referrals?

To start you have to be selling quality products or offering prompt, reliable services. Give your clients and prospects free things. People love freebees, no matter what they are. Some suggestions include reports, white papers, promotional products and gift certificates to mention a few. How about giving your customers referrals. Offering freebies to your clients and prospects can be very effective at encouraging referrals.

Referral prospects are warm leads. They take less time to make up their minds. They tend to spend more and raise fewer objections. Usually they come to you already having positive feelings toward you and your business and they bring a degree of trust to the table.

Every time you receive a referral always send a thank you gift or note. Let the person know the outcome of their referral. Studies show that these 2 simple acts can increase the amounts of referrals you get by 20-40%. Make sure you follow-up on all referrals.

The bottom line is you need to have a specific referral strategy or referral prospecting program if you want to build your business on referrals. Anything less is just wishing and hoping. If you are really serious about getting more referrals I highly recommend that buy Bill Cates book on how to get more referrals.

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