Building Referral Business

This week we're talking about W. Edwards Deming's quote about profit in business coming from repeat customers. Today, we'll address how to get your customers to "bring their friends with them" through referrals.

Referral expert Paul McCord has some useful insights:

"Acquiring referrals from clients is not as simple as 'doing a good job' and then asking for referrals," says McCord. "Generating a large number of highly qualified referrals from a client is a process that starts from the moment the prospect is first met, not a one-time act after the sale has been completed. It requires an understanding of what a successful referral is based on, and how to exploit the referral to insure a successful contact with the referee."

Here are McCord's 4 Pillars of a Successful Referral:

Your Relationship with Your ClientYour relationship with your client must be built on trust and respect. Most clients will not give referrals to people they trust and respect unless they trust and respect you.

Your Client's Purchasing ExperienceClients assume that whomever they refer you to will be more critical and more demanding than they themselves have been. Consequently, you must provide the client the exact purchasing experience they want and demonstrate that you will not embarrass them in front of their friends, family, co-workers and acquaintances.

Your Client's Relationship with the Referred ProspectWith a referral, you are trying to build a relationship with the referred prospect based on their relationship with your client. You must know the relationship between the two. If the prospect trusts and respects your client, you begin your relationship with that prospect with some of that trust and respect imbued to you. Likewise, if the prospect distrusts and disrespects your client, you begin the relationship with some of that distrust and disrespect imbued to you. You must know where you stand with the prospect before you contact them.

The Method Used to Contact the Referred ProspectBased on the client/prospect bond, you must determine how best to contact the prospect to produce the greatest opportunity to acquire a meeting. If the client/prospect relationship is extremely strong, virtually any contact method, including a phone call from the salesperson mentioning the client's name will suffice. But, for a weak relationship, the rep must strive to use the strongest contact method possible, such as, a client letter or phone call, or a lunch meeting between the client, prospect and rep.

Author of "Creating a Million Dollar a Year Sales Income: Sales Success through Client Referrals," Paul McCord is president of McCord & Associates, a sales training and management-consulting firm.

People Are Talking

Today we're looking at the second element in W. Edwards Deming's formula for profit in business: getting your customers to boast about you.

Sales and marketing coach Dr. Rachna D. Jain has some tips for easily and effectively garnering testimonials:

Let your customers know right up front. Start every new customer relationship with a brief explanation of how you appreciate testimonials and how they help you serve your customers better. Ask all new customers/clients if they would be willing to provide you a testimonial if they are satisfied with your service.

Ask for them. Very often, sales reps will take step one, but never take step two. The client has agreed to provide a testimonial, but the business owner never follows up and asks for the testimonial. It's most effective to ask when your client or customer is especially pleased or satisfied with your service.

Make it easy. Make it as easy as possible for your clients to provide you with the testimonial. Consider having a pre-designed form, or a standard email. You may even want to ask certain questions to help shape the tone or format of what your client shares. For example, if you really want your clients to comment on your "outstanding customer service orientation," you might put a question or two in the form about this.

Write it yourself. Sometimes, clients will agree to provide a testimonial, but never actually do it. In these cases, it's perfectly acceptable to offer to write the testimonial yourself and have the client sign it. Ask the client if you might call him/her for 10-15 minutes for a brief interview about the high points of your business or service. Then write what you hear, and send it to the client for approval.

Get permission. It's very important to get your clients' permission to use their name, city/state, or website address in your own marketing. Most clients will understand that you are obtaining a testimonial for your marketing efforts. I have always found it wise to ask them to sign a brief statement which demonstrates that they have given permission for the information to be used.

Offer something in return. Most satisfied clients will give you a strong testimonial without expecting anything in return. For myself, I've found that offering a small "thank you" (a brief coaching session, a copy of one of my books, a discount on a class or training) goes a long way to helping clients feel valued and appreciated for their extra time and effort.

Dr. Rachna D. Jain is a sales and marketing coach. To learn more, contact Dr. Jain directly, or to sign up for her free newsletter, Sales and Marketing Secrets, please visit her website.

Quote of the Week

"Profit in business comes from repeat customers, customers that boast about your project or service, and that bring friends with them." -- W. Edwards Deming

SalesDog asks:

So, what are you doing to earn repeat business from your customers?
How many of your customers boast about you? And, are you asking them for testimonials?
Do you consistently ask for referrals?

This week we'll share some tips to help you build repeat business, earn glowing testimonials, and referral business.

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