Referrals, we are told from our first day on the job, are the best prospecting tool in any salesperson’s toolbox. According to sales legend, the path to top-producer status is paved with referrals. Yet, the truth is that very few salespeople generate many high-quality referrals.
And then there are those who get a few names and phone numbers here and there. Unfortunately, most of these “referrals” don’t turn into sales. For most salespeople, trying to get referrals can be so disappointing they stop asking altogether. These salespeople conclude that referrals are just a myth, that they aren’t worth the time and effort it takes to get them.
In reality, the problem lies not with referrals in general or with your clients in particular. The problem lies in how you ask for referrals. Here are five more of the top referral mistakes salespeople make:
1. Not defining what a good referral is. Few salespeople let their clients know what a good referral is and assume that they already know. Bad assumption. Your clients need direction. While you are standing there thinking “Give me someone just like you,” they are thinking “What does this person want and how do I get rid of him?” If you want a quality referral, you must let your client know who you’re looking for. If you don’t, there’s no telling what you’ll get.
2. Not understanding the psychology of a referral. Getting a large number of high-quality referrals from clients and prospects isn’t easy. In fact, less than 15 percent of all salespeople generate enough quality referrals to significantly impact their sales. In order to become a successful referral salesperson, you must understand the psychology of referrals. Clients assume that anyone they refer you to will be more demanding and more critical than they have been. In addition, clients will refer you to people with whom they have various types of relationships. Some will trust and respect your client, some will not. To make matters even more complicated, you must understand your own psychology of referral selling. What goes on in your brain is just as important as what goes on in your client’s brain.
3. Calling the referred prospect. The natural inclination when you received a referral is to pick up the phone and call your prospect. Wrong. When you simply pick up the phone and call, you’re giving your prospect the opportunity to determine you’re nothing but another telemarketer and mentally cut you off before you’ve even had the opportunity mention your client’s name. There are a number of ways of contacting a referred prospect, but the key is to get a personal introduction — not just a name and phone number.
4. Not helping the client give referrals. Even mega-producers who make huge incomes from their referral-based businesses have clients who claim not to know anyone to refer. Yet, these men and women manage to walk away with a fistful of high-quality referrals. How do they do this? Instead of passively hoping their client has referrals for them — as most salespeople do — they are proactive and help their clients make high-quality referrals. They discover whom their clients know and they ask to be referred to those specific people.
5. Not earning referrals. If you want a large number of high-quality referrals, you can’t just ask for them. You must earn them. Successful salespeople understand that the number and quality of referrals they receive is dependent on delivering the purchasing experience their clients want. Consequently, they find out what it is their clients want and expect to happen in the course of a sale and then do those things. You don’t get to determine whether or not you’ve earned a referral. That’s your client’s job.
No matter what you sell, whether you sell to individuals or businesses or how much your product or service costs, you can build a referral-based business with the right approach.
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- 5 tips for a successful referral request
- 4 ways to get better at asking
- 5 tips to build your referral sales
Paul McCord is a best-selling author, speaker and leading authority on lead generation. He has more than 20 years’ experience coaching and mentoring salespeople. For more information, go to mccordandassociates.com.