PART FOUR – The Reputation Book
HOW TO GET REFERRALS
Guy Arnold is the Founder of ‘Sales Through Service’ and ‘Investors in Feedback’
Russell Wood is a professional trainer and business advisor, whose background is in the retail, leisure and gaming industry.
Referral systems don’t need to be overly complicated. In fact, the more complicated you make something, the less likely it is that people will use it. In a nutshell, simple, easy systems get great results.
- One-click ordering
- Regular simple payment schemes
- The poker chip system
Which brings us on to the first point, ‘Why People Don’t Bother to Refer an Organization’
- So many companies fall into the trap of asking the standard ‘How likely is it that you would recommend us to a friend,’ ques- tion without any follow up. That’s a question. It’s not a call to action. It has little real output
- Companies don’t develop a system that makes it easy for customers to refer them. And if it’s not easy they’re not going to refer you. They are too busy, distracted, uninterested etc. – life is busy enough already!
There are five things that you have to consider for great
- Get referrals from the right people
- Get referrals to the right people
- Get referrals for the right reasons
- At the right time
- In the right way
All these steps should be taken slowly and done inch by inch (to make it easy for them) – don’t go for it like a bull in a china shop!
ACTIVE OR PASSIVE?
- Active referrals are systems that involve actively following up
- Passive systems don’t involve actively follow-up. They rely on your customer doing all the work
Of course, active systems are generally harder to make work but they are much more effective when they do work. They are also much more suited to relationship and partnership situations, they can be better described as a sniper approach.
Passive systems are easier to put in place but very often have low success rates due to lack of customer motivation. They are more of a shotgun approach and are more suited to transactional, lower value emotional situations.
Whatever is most suitable for your organization and market, the following principles and steps apply in the same way. You just need to adapt them to your situation, without losing the processes and principles embedded in them.
HERE’S HOW YOU DO IT:
FROM THE RIGHT PEOPLE
The right people are the ones who love you and have given you permission. They are the ones who told you they thought you were great in your feedback systems. Do not ask for referrals from anyone else. If you do, then you’re a blithering idiot.
- If you ask someone who rated you as ‘poor’ or ‘satisfactory’ for a referral, you are essentially telling them that you don’t care about their feedback
- And if you ask for referrals without asking for feedback first,
you’re essentially saying that you don’t care about what customers think, you just want to sell more of your stuff. Who would want to recommend or refer an organization like this? But, this tends to be the default situation for most referral systems – another reason why most referral systems don’t work
Remember to go through this process with an inch-by-inch approach. Always start by getting permission to speak with them. Never get greedy.
TO THE RIGHT PEOPLE
The right people are those who fit the profile of your ideal customer. If you don’t have a profile for your ideal customer, then you need to create one. Don’t target just anyone!
Creating the profile for your ideal customer starts by answering questions like these:
By the time you are done creating a profile for the ideal customer, it should be so clear that you can envision this person as if he/she were standing in front of you.
So now you can tell your existing customers exactly what type of customer they could refer you to, otherwise they won’t know.
FOR THE RIGHT REASONS
Why do you want to get referrals?
This all comes back to your customer focused mission. Getting referrals helps you keep your marketing costs down so that you can also keep your prices reasonable. It also helps you continually keep on your toes and improve your organization processes to continually create more value for your existing customers.
Any other reason is you just wanting to sell more of your stuff – thus making you remarkably unpreferable!
Why would these people want to refer you?
- You’ve provided them with great service
- You’ve gathered feedback excellently
- You’ve made it easy for them to refer you
- You’ve done small things that are easy to say “yes” to
What’s in it for them to refer you?
When people refer you to others they are putting their own reputa- tion on the line, and going out of their way for no direct reward. So,
make sure that everything you do is designed in a way that makes them look really good when they refer you. You can’t ever let them down. You must have earned their trust enough so that you are seen as someone who is genuinely worth referring.
You must be systematically highly referable, this is non-negotiable. A referral is an emotional act, you need to have a strong emotional tie with your customer to incentivise them to do this beautiful act for you.
Any other reason is short lived, fatuous, counterproductive and contradictory. For example: offering incentives or free prize draws!
How do you spread a reputation of being someone worth referring?
- When someone refers you, you then need to blow the socks off of both parties
Party 1: The ‘Referee’
The person being referred to you should get a better deal than if they had found you through normal processes. You reward them for being referred.
- Because your existing customer put their reputation on the line for you – you need to support their faith
- Because it’s much more cost effective to find people this way.
That means you should be able to give them a better deal. Think of all that marketing time, money and effort you’ve saved
arty 2: The ‘Referrer’
Make sure that you have a great thank-you system for all referrers. This could be a simple phone call. It could be offering to do a little work for them free of charge, it could be a bunch of flowers, it could be special gift or event. The important thing is a thank-you, not a bribe. You never advertise it in advance; you just do it – as you would do with a great friend, because they are being a great friend to you. This is very important.
You have to make sure that whatever you do to say thank-you is going to make the organization glad that it helped refer you. If you get this right then they will continue to refer your services. Not only will you have received a referral from them, you will also have put them into the habit of referring you! It’s amazing that when someone refers you once, they are much more open to referring you on a regular basis.
AT THE RIGHT TIME
The right time to ask for referrals is directly after receiving feedback. This is included in the feedback system we discussed earlier.
But don’t rush it. Wait until they say they’re happy and willing, never before!
IN THE RIGHT WAY
- Always gather feedback first!
- Do it inch by inch. Ask for one referral at a time
- Make it fun. Don’t be boring. This whole system is about building a relationship. And don’t sound like you’re reading from a script
- Explain why you’re asking for referrals:
Ask permission to get referred. Remember that “no” is okay.
- Always follow up on your promises. If you say that you’re going to call back in a week, be sure that you make that phone call
- Make sure you thank them for referring you
7. FEEDBACK AND THANKS
Go the extra inch.
- Keep the referee informed about progress
- Implement your thank-you system quickly and generously. If it’s a genuine referral, even if you don’t get any business from it, you should say thank-you with your systems. It shows that, whatever happens, you’re genuine and very referable
- Consider having a continual small reward system for customers who refer you, if you have systems that can cope professionally with this
8. FOLLOW UP
Go the extra inch. Thank them again later down the road.
What if you were to call them three months from the time you got the referral and say, “I just wanted to let you know that we’ve done some really good business with the person you referred us to – thank-you again for referring us.”
Let’s take a moment to look at a few great passive referral systems (they help understand the ideas and we have already run through the ‘active’ referral process step by step).
My wife got an envelope in a delivered vegetable box that read “Things in Threes are the Bees Knees.”
Without even opening the envelope, we can already see that it’s fun. Of course, we would want to open it. When we opened the envelope, the note inside reads as follows:
“Give the Gift of Adventure to Three Lucky People”
We’ve been hooked by the cover and now the message is pulling us in. All that’s left is to give a call to action.
It clearly explains exactly what they want you to do in a very easy- to-follow format. It reads as follows:
- Open the envelope.
- Write your account number on the voucher. You can find your account number on your receipt.
- Give the vouchers to your favourite people so they can try one of our organic fruit and vegetable boxes.
Wow! That voucher does everything quite wonderfully. It’s fun
makes it very easy on the customer to refer three of their friends.
Each voucher then explains to the referee exactly what they need to do in order to claim their free fruit and vegetable box.
This passive referral system is absolutely perfect.
Another card from a competitor of the previous example. That wasn’t as much of a fun read…
“Veg for your friends. £10 for you. Free cookbook for them.”
It’s not as ‘in your face’ as the previous example but it’s still a good card. Again, the process is very simple. The card has small tokens that you simply tear off and give to a friend.
This example demonstrates that a feedback and referral system should be fun, creative, and provide a direct, yet simple call to action. Whatever you do, make sure that your system is:
Note: the above systems are all to be used in transactional and emotional organizations. If you’re in a different style of business use the principles to design a system that works brilliantly for you.
REPETITION AND REINFORCEMENT
Now we’ve outlined the principles and steps for effective referral systems, it’s time for a little bit of repetition and enforcement:
Everyone bangs on about ‘getting referrals’. But they conveniently forget the one crucial point that no one wants to give you referrals. They’re too busy getting on with their own life!
Don’t get caught in the much promoted trap of thinking streams of referrals will follow a positive answer to the question, ‘How likely is it that you would refer us?’ That’s just a starting point!
But, referrals are by far the most powerful and profitable way of building an organization. So, how do we get them, and what can we do to make it actually work?
Let’s look at it from the individual customer’s point of view:
Whether or not we liked the customer experience isn’t what motivates us to take the risky step of referring something (or someone). We have all the following issues to sort out first:
- Do I want to be responsible if my friend has a bad experience?
- Does this provider give the impression of being able to cope effectively with extra custom?
- Will the provider be upset with me if this goes wrong or
- How does it make me look? How does it affect my professional and personal standing?
- How easy is this organization’s offer to explain to someone else?
- Does it look like I’m getting some sort of kickback or special treatment in exchange? How does this affect my own reputation?
The key is this: and the order of this is CRUCIAL: get it wrong, and in today’s market, you’ll really screw up!
make it easy
- Be genuinely referable first
- Make it easy
- Proactive systems
- Great responses to all feedback
- Elastic & Velcro Marketing systems
- Right process
- Easy and engaging processes
- Keep honing and improving
- Measure & respond
That’s how to get referrals!
HOW TO FOLLOW UP REFERRALS
Many people believe that cold referrals can be hard to follow up. Here’s some help in this area.
The main factor that you have to keep in the back of your mind when dealing with cold referrals is that they do not trust you. With so many people bombarding them with offers, can you really blame them for not trusting you? They don’t even know you! For all they know, you’re just another annoyance trying to take their money.
You have to be remarkable to get past their understandable barriers! Again, average just doesn’t cut it.
The good news is that you already have a system in place that is designed to build your reputation, so are you ready to get started?
Let’s be honest. No one wants to speak with you. Everyone’s too busy. Therefore, you have to make sure that you’re worth talking to. You only have a few seconds to grab their attention so make sure that you get the idea across in that time. Focus on their real needs.
AN EASY INCH-BY-INCH APPROACH
Here’s a step-by-step approach to help you with cold referrals. This is designed for a B2B situation, but you will see that they can be easily adapted to suit any customer relationship. Remember to approach this process in the same way that you do your other calls. Always ask for permission and utilise the inch-by-inch approach.
Step 1: Introduction
Start off a call by giving the customer your name and the reason for your call. Time is a valuable resource: give them a great reason to spend this valuable resource on you. Always be honest!
Tell them the results you achieved for the referrer. Those results were rated as ‘great’ (otherwise you would not have asked for a referral) so now you have a chance to brag a little bit about it. The referrer would be happy to confirm everything you tell them.
Next is an area where a lot of people really drop the ball. You are not going to be able to help everyone – you have to be honest. Tell them that there might be a way that you can help them get similar results. Don’t say that you can definitely help them. How could you possibly know with 100% certainty that you can help them? You don’t even know them.
Ask whether this is a good time or if they would prefer that you call them later. You need permission to continue. If it’s not a good time, then ask if you can call back at a better time.
You’re only going to have a few seconds to earn enough trust to be given permission to continue with the call. Make sure that you craft an introduction that includes everything we mentioned above. This introduction should be between two to three sentences. If you are given permission to continue, then do so. If not, then either reschedule the call or end it. Never try to pitch to anyone who is not interested.
Step 2: Explain Why You Called Them
This one is going to be a value statement based on your customer-focused mission. Just be honest and explain exactly what it is that you have to offer.
Make sure you also use this sort of phrase, “our typical customers are those who have a limited budget and want to get excellent results without having to spend a fortune.”
Step 3: Get Permission to Ask a Genuine Question
You have gone through the introduction and explained what it is that you have to offer. You have their full attention at this point you’re going to start peeling the onion.
Lead off with this question:
“Does this seem at all like a product/service that might be of interest to you?”
Listen to their response closely. When they are finished, then you ask another question. Regardless of their answer being “yes” or “no,” respond with this:
“Okay. Can I ask you one question?”
Asking for permission again builds trust and makes them comfortable. It’s much better to ask for permission than it is to instantly try selling them something.
Step 4: The Question
The next question depends on their answer to, “can I ask you one question?”
If they answer yes, ask: “Can I ask what your main issues/opportunities/wants/desires/pains/problems/needs in this area are and how you solve them at the moment?”
If they answer no, ask: “If I called you back at a better time would you be willing to discuss your main issues or needs in this area, and how you solve them at the moment?”
The trick is to really listen to them, peel the onion gently with open questions. If they tell you “no,” then thank them and end the call. It’s perfectly okay for them to say no.
Step 5: Get to the Point
By now you will have built up quite a bit of trust. You should also know the problems that they are facing. It’s time to get to the point. Work deeply with the customer’s real needs. Peel the onion some more.
Here’s what you could say:
“I don’t want to waste your time and I don’t really know yet whether our services might be useful to you. Do you mind if I ask two more questions to determine if it’s worth scheduling a more in-depth conversation?”
If they answer “no” then thank them for their time, peel the onion to find out more information if you can – what WOULD they want to talk with you about, now or later – and at the right time, thank them and end the call.
If they answer “yes” then move on to the next step.
Step 6: Ask the Two Questions
Here are the two questions that you ask. Again, make sure that you listen carefully to their response.
“Who are your customers and why do they buy from you as opposed to your competitors?”
This question establishes their current situation.
“What would be the main things you’d like to do better, and what concerns might you have about taking on a new supplier?”
This opens the door as to what they want to know about you.
Step 7: Ending the Call
The end of the call is a very important process that is often overlooked. This is your opportunity to make their life easier, show them attention and build further trust.
Three things must happen at the end of the call.
- Confirm everything that has been discussed. Then decide what’s going to happen next. You can schedule a more in-depth call or even a personal visit. On the other hand, your organization might not be a good fit with theirs. In that case, you absolutely must not try to “make it work.” Don’t be afraid to say “no.”
- Provide even more value to them by telling them about (genuine) extras that you are able to offer them because they were referred.
- Genuinely thank them before ending the call. Your goal is to reassure them that they have made a good decision, whatever it is.
Then take it from there with your normal sales processes.
That one word ‘objection’ can seem scary. Well, we have some good news for you. The word ‘objections’ is absolute rubbish. There’s no such thing in the business world.
Statements that are seen as objections are, in fact, just genuine concerns from the potential customer for good reasons – primarily about how they can get the best result for themselves.
You would do exactly the same thing if you were in their shoes!
There are concerns that are important, and the action to take is listen, peel and address these legitimate concerns. Whether or not you get a sale is not really important right now. These concerns are paramount.
This is NOT a battle!
Remember your customer-focused mission and the customer’s real needs. Everything you do should be based on listening and welcoming these concerns. This is the only way that you will ever know how you can genuinely help a customer and build a great long-term relationship so they can, in turn, refer their contacts to you over time or not.
Remember that no is OK, if you get the relationship right they may want to do business with you later and refer others to you. Either
way, you’ve not compromised your status of being genuinely remarkable. You’ve not compromised yourself just to get the sale.
It also reveals the most efficient way to help them.
- Listen deeply. It always seems to come back to listening, doesn’t it? That’s because so few companies truly listen to their customers. The ones that do are successful
- Peel the onion with open questions. Make sure that they give
you permission to do this
- Determine their needs and ‘desired results’. It’s never about what you want. It’s about what they want
- Only try to solve a problem when they ask you to. Never try
solving their problems without permission
- Work together to find a win/win solution, either you can do business together for the right reasons, or you can’t do business together for the right reasons. Never try and do either for the wrong reasons
And then you’ll be fine.
KEEP REPEATING AND IMPROVING
Once you have developed a system to use with your customers, you can start focusing on other sources of referrals, as already mentioned. Many people tend to overlook them.
Keep following the same four principles and you will eventually be able to start asking for referrals.
- Get your mission right
- Think of your customers’ real needs first
- Build the relationship
- Put measures in place to keep improving
If you don’t continuously improve your system then your competition will catch up with you. When you get it right, someone else is going to notice – and the more successful you are, the harder your competitors will fight to lure away your success.
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