How to Establish a Plan for Business Referrals - dummies

How to Establish a Plan for Business Referrals

By Michael Soon Lee, Ralph R. Roberts

Referrals to your business from satisfied customers don’t just happen; you have to have a plan to generate referral business. You can develop a systematic strategy for generating referrals by following some basic steps.

  1. Set a target.

    Set a clear goal with a timeline for referrals, such as a 10-percent increase in referral business over the next eight weeks. This will remind you to ask for referrals whenever the opportunity presents itself.

  2. Let your customer know from the beginning that you’re going to ask for referrals.

    For example, you can tell clients that you intend to satisfy them so well that they’ll want to refer three new clients to you after working with you. This makes it clear that you’re planning on taking very good care of them and that, in return, you expect referrals.

  3. Earn your referrals with the best service possible.

    Referrals don’t come from the generosity of your customers — you have to earn them, or at least earn the right to ask for them. Give your clients extra-special service and follow-up support to earn the right to ask for referrals.

  4. Go ahead and ask for referrals.

    Most businesses just wait for customers to refer them, thinking that if they provide stellar customer service, this will happen automatically. Frankly, many people are too busy or simply forget to talk up your great product or service, so you must remind them to be alert to opportunities to refer you.

  5. Assist customers in identifying referrals.

    When customers buy stuff, they’re usually not thinking about other people who would benefit from the same products or services, so when you ask for a referral, they’re likely to say that they can’t think of anybody right now who could use what you’re selling.

    To clear this hurdle, stimulate the customer’s imagination by asking about people at work or clubs they belong to. Let your customers know the types of clients you can help. What needs do they have in common? This helps them identify specific people they can refer to you.

  6. Work on your timing.

    In referrals, as in sales, timing is everything. If your request is too early or too late, it’s likely to make you feel awkward and your customers uncomfortable. The right timing varies, depending on the type of sale and customer.

  7. Offer incentives.

    Offer an incentive to both the referrer (the person giving the referral) and the refer-ee (the person being referred). Such an incentive encourages your customer to give the referral in the first place and encourages the prospect to follow up by calling you or visiting your business.

  8. Contact referrals with care.

    How you approach prospects whom customers refer to you is crucial both in preserving your relationship with the referring customers and turning new prospects into customers.