Overview

Do your clients LOVE YOU?  Love you enough to refer a friend or family?  Referral marketing is a structured and systematic process that maximizes word of mouth potential. Referral marketing does this by encouraging, informing, promoting and rewarding customers and contacts to think and talk as much as possible about their supplier, their company, product and service and the value and benefit the supplier brings to them and people they know.

Referral marketing takes word of mouth from the spontaneous situation to a proactive and highly productive solution, where maximum referrals are generated due to professional customer-focused strategies.

Online referral marketing, using digital marketing as a platform, is the Internet based successor to traditional referral marketing.  Given the advances in tracking customer behavior online through the use of web browser cookies, online referral marketing provides a higher degree of accountability.

To put it in simple terms, referral marketing is a specific set of strategies and tools designed to bring small business new clients, qualified leads, and repeat business without the aid of, or in addition to, other advertising methods such as print, internet, radio or tv.

Many business owners have built great companies entirely upon referrals. Almost all businesses get started this way. The business lands a client, does some good work, and that client tells his/her family and friends. Before you know it, this kind of word-of-mouth marketing creates a steady stream of more customers and prospects.  But what most small business owners don’t understand, is that many of these same companies never understood that they could generate even more business if they actively participated in the generation of referrals.

Some professions, such as lawyers, doctors, and accountants, are very much suited to referral marketing.  Most people simply don’t feel comfortable hiring a doctor based on a doctor’s advertisement in the Yellow Pages. When looking for a professional of this nature, most people will ask someone they trust for a referral, such as a good friend or family member.

As a rule of thumb, the more personal or the more expensive a service is, the more likely it is that a potential client will seek the advice of another. A window washing company, for example, whose crew may spend a great deal of time going from room to room in a client’s house, will benefit greatly from referrals.

Why Referral Marketing Is So Strong

Experience tells us there is typically two things that often hold small business owners back from taking complete advantage of referral marketing:

• No System -They simply don’t have a system for tracking referrals
• Fear – That somehow no one would ever refer a prospect to his or her business

Let’s try to help you get over the fear of making referrals a core part of your marketing.

When we say fear, we mean things like fearing of being rejected, fearing that you will appear to be begging for business or fear that your existing clients don’t really care about helping you build your business.

All we can say to this is – you have got to get past this!  If you provide a product or service that helps people solve problems and meet needs, then you are doing a disservice to your customers and the world in general if you don’t actively seek referrals.

If you think your clients will be put off by your desire to involve them in helping you grow your business, you aren’t thinking about the relationship the way you should.

The entire act of generating a referral comes down to two simple things:

Provide a product or service that people like.

Manage the referral expectation.

Key Points to Remember:

• To get better referrals you need to target your prime referral sources.
• You must educate your referral sources in order to receive qualified leads.
• Make receiving referrals part of your client’s expectation.
• Find strategic partners and create multiple referral sources.
• Follow up with your referral sources.