For 18 years, I’ve been helping businesses of all sizes acquire new clients through referrals. My first three books focused on the referral process itself: becoming more referable, getting referrals without asking, asking in a confident manner without pushing or begging, networking more effectively, using target marketing, and engaging in all the other strategies that generate an unlimited supply of referrals. But a referral isn’t the end game, is it? Getting a referral is only a means to an end in your efforts to obtain a new client. While a referral is clearly the best way to meet a prospect, your process can’t stop there.
The Perpetual Revenue System
Satisfied clients give you referrals. You turn those referrals into introductions so that the new prospects will be open to hearing from you. From the introduction, you set an appointment to begin the client-courtship process. From there, you endeavor to win the new clients and make the sale. As you provide great value to the new clients, the process starts all over again. It’s simple. It’s easy. And you can get this going right now!
Referrals Aren’t Enough
Have you noticed how crazy-busy everyone seems to be these days? Have you noticed how it’s hard enough to reach your clients, let alone your prospects? Have you noticed how hard it’s become to cut through the noise that your prospects experience every day just to grab their attention for a minute or two? Referrals are not enough. We have to think in terms of introductions! When you’ve been introduced to a prospect, that prospect’s interest is piqued; that prospect is more likely to answer your call, return your call, or reply to your e-mail.
You want to convert the referrals you get into engaged introductions. An engaged introduction is a collaborative effort where the referral source works with you to make sure you get connected to the new prospect. An engaged introduction is not just word of mouth. And it’s not just “give her a call and feel free to use my name.” An engaged introduction gets your foot in the door and establishes a genuine connection between you and the new prospect.
It’s Different When You Work from Referrals
After you’ve received the referral, you have to set the appointment with the new prospect. Depending on your business model, the appointment may be in person or may take place over the phone. Contacting your prospects and setting appointments look different when you work from referrals (over other types of lead sources). What you learn about the new prospect from your referral source helps you craft a much more compelling reason for why that prospect should give you a piece of his or her valuable time.
You see, just because you’ve met someone through a referral, it doesn’t mean that person is going to meet with you. Of course, when the trust level between the referral source and the new prospect is high, that is sometimes enough to move the sales process along. But not always. In most cases, you have to continue to deliver value and build trust so that the prospect warms up to meeting with you. Sales is Not a Four-Letter Word
The goal of sales and marketing is gaining a new client. And “closing the sale” should not be about tricky, manipulative closing techniques. In fact, I’ve never liked the word closing. That’s because making the sale is not the end of the relationship or the closing of the sales process. It’s the beginning. And if you trick people into buying from you, then their reaction may be regret. This can lead to cancellations and certainly no referrals. While you will see me use the word closing from time to time, think in terms of confirming the sale or confirming the new relationship.
Making a sale is much more than saying to your clients, “Here’s what I do. Here’s how well I do it. Wanna buy from me?” This is an over-simplistic picture of what’s going on out there with many salespeople, small business owners, and professionals. They present their value proposition and think that’s enough. Unfortunately for them, sometimes it is. This leads to laziness in the sales process.
We always want to have a model or process for converting a referral prospect into a new client in a way that all parties feel good about the process. When you bring on new clients in the right way, you can become highly referable very early in the new relationship. This, in turn, allows you to keep the Law of Perpetual Revenue running smoothly.
Build a Referral Culture
I often call referrals “forgotten gold.” Most businesses know the importance and effectiveness of referrals and introductions, but very few have strived to build a referral-based business. They give lip service to referrals, but they rarely train their people in how to generate referrals. Some companies have adopted the practice of measuring their Net Promoter Score.
The Net Promoter Score is a customer loyalty metric developed by (and a registered trademark of) Fred Reichheld, Bain & Company, and Satmetrix. It measures the ratios of customers from a low range of “detractors” to a high range of “promoters.” Proponents of the Net Promoter Score say that it’s the most important metric in measuring customer service: Will the customer promote our business to others?
While this is certainly a worthwhile measurement, most companies don’t go to the next step of leveraging these scores. They don’t become proactive in turning promoters into connectors. They encourage word of mouth, but they don’t go for referrals and introductions. Stopping at worth of mouth is an incomplete growth process.
To maximize new-client growth through referrals, you have to be referable and you have to be proactive.
Create Exponential Growth
One of the beautiful aspects of this dynamic is that it does not result in linear growth; one new client at a time. This process creates exponential growth, where one client can lead to two, two to four, four to eight, and so on. Your business grows exponentially! And the cycle continues… perpetually!
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