At first glance, a referral is a pretty simple thing. For most sellers, managers, and trainers, a referral is just a name and phone number that a client has given once the seller has completed the sale, has done a good job for the client, and then asks a general question such as, "do you know of anyone else that I might be able to help?," or, "do you know of anyone else that might benefit from my products and services?".
Once a seller has received a referral, contacting the referred party is just as simple. The seller will call the referred party mentioning to him or her that the client, which the prospect knows, referred the seller to them, or on occasion they will ask the client to write a referral letter to the prospect and then the seller will call the prospect after they have received the letter. A very simple, straightforward process.
Unfortunately, this "do a good job and ask for a referral" process is totally and completely wrong, and has been proven by millions of sellers to not work worth a darn. Nevertheless, this is what is taught in almost every sales course that mentions referrals. And not only is it a waste of time and effort, it deceives the seller who don't succeed when using it into believing that the fault lies with him or her, not with a "system" that doesn't work.
Generating a large number of high quality referrals requires far more than "doing a good job and asking for a referral."
If you want to generate a large number of high quality referrals from your clients, you must understand what creates a quality referral.
A high quality referral is built on a foundation that has four solid pillars-and as the seller; you have control over three of them:
- Your relationship with your client: Most clients don't give referrals because they like you or even because you did a good job. Certainly there are a few clients that will give referrals at the drop of a hat, but most clients hate to give referrals and unless they have a deep trust that you will not embarrass them and that you'll deal honestly and competently with the prospect they refer, they won't be willing to give quality referrals.
Most clients believe that when they give a referral they're not just suggesting that someone they know speak to the person they are referring, they believe that they are endorsing the seller, in essence telling the person they refer to the seller that they don't need to do any research because the referrer has already done it and this person they're referring is the best choice. To get clients to take this step doesn't come without having built a strong bond of trust.
- Your client's purchasing experience: Discover what your client's purchasing expectations and priorities are, then meet and, hopefully, exceed them.
Few sellers ever exceed their client's expectations because even though they think they know what the client's expectations are, they never really try to find out, they never ask. You cannot afford to guess or "think" you know what your client's expectations are-you must know exactly, and you can only do that by discussing them with your client and then making sure you meet or exceed them-nothing less will do.
If you don't specifically ask your client what their expectations are, the best you can do is meet or exceed what you think your client's expectations should be.
Clients assume that the purchasing experience anyone they refer you to will have a similar or WORSE experience than they had. The further away from their desired purchasing experience they have, the less likely they will be to give a quality referral.
- The relationship between your client and the prospect: This is the one pillar you have no control over. Clients will refer you to people they have very strong, positive relationships with-and people they have very negative relationships with.
If the prospect trusts and respects your client, some of that trust and respect will be automatically imbued to you and you start your relationship with them from a position of strength. On the other hand, if the prospect distrusts or doesn't respect your client, some of that distrust or disrespect will also be imbued to you and you will start your relationship with them from a position of weakness. Your job is to find out exactly what the relationship between client and prospect is and then plan you introduction approach to them accordingly.
- Your initial contact with the prospect: To this point you've invested a great deal time and effort in establishing your relationship with your client, making sure they have exactly the purchasing experience they want, and finding out what the relationship is between your client and the prospect they are referring. After investing so much time and attention to get this far, the last thing you want is just a name and phone number.
Instead of getting a traditional "referral" consisting of the name and phone of the prospect and permission to use your client's name, get a direct introduction from your client to the prospect.
There are three primary methods of getting a direct introduction:
Letter of introduction from your client to the prospect: Ask your client to write a letter introducing you to the prospect. However, once you've asked your client to write the letter, let them know that you know how busy they are. Offer to take the burden off of them by writing the letter for their signature. If you allow them to write the letter it won't communicate a reason for the prospect to meet with you and it will be written on their schedule-which could be never.
The letter you write should give a brief overview of what you've done for your client and why the client believes it would be beneficial for the prospect to meet with you, as well as the time and date to expect a call from you. Have your client sign it. Phone the prospect at the exact time your client indicated you'd be calling.
Introductory phone call from your client to the prospect: An even stronger introduction is a phone call from your client to the prospect to introduce you. This method puts additional pressure on the prospect to agree to set an appointment with you as it is difficult for the prospect to say "no" to your meeting request when they know that their friend, co-worker, or associate is standing next to you when you ask.
The downside to a phone call is it gives the prospect the opportunity to ask questions of your client. If there were aspects to the sale that didn't go well there is a good chance they will surface during the phone call.
Lunch meeting with your client, the prospect, and yourself: A tremendously strong introduction method. Have your client invite the prospect to lunch or coffee with the three of you. Encourage your client to let the prospect know this is NOT a sales meeting, just an opportunity for the two of you to meet one another.
One of the strange things that often happens during the meeting is the client ends up being your salesperson and you are there simply as the consultant. And, again, it is very difficult for the prospect to say "no" when you request a meeting.
As seen above, you have control of the majority of the pillars upon which a referral is based. If any of the above is weak, your likelihood of generating quality referrals will decline and the weakness must be made up elsewhere. In actuality, if one of the first two segments is weak, you will not be getting quality referrals-period. However, you can mitigate the third one by using a strong method of introduction.
Generating a large number of quality sales isn't done by chance or luck, and neither is generating a large number of high quality referrals. Just as you need a well thought out process to consistently sell, you need a well thought out process to generate quality referrals. You can significantly increase the volume and the success of your referrals if you understand the dynamics that generate quality referrals and then control those dynamics.