How to Generate More Referral Business
Posted on 30. Jun, 2010 by Matthew Toren in Business, Entrepreneurship
Getting new business is a constant struggle for many small companies. A lot of companies market aggressively and spend a lot of money to increase brand awareness and reel new customers in. Marketing is certainly important, but when you’re an entrepreneur on a tight budget, it’s also important to make sure you’re getting the best bang for your buck.
Today, I want to talk about the power of the referral. Referral business is my favorite kind of business because it shows that my customers are so happy with my services that they’ve told a friend about them. And well, the fact that it’s cheap to generate referral business is pretty nice too.
But how do you go about getting more referrals? Contrary to popular belief, they won’t always come naturally. It takes effort on your part to get customers talking about you, and I’m going to share some of my favorite tips with you for generating a steady stream of referrals.
- Provide consistently great service-Let’s face it: No one is going to refer you if your products and services are average or vary in quality. Remember, when someone refers your business to a friend, that person is putting his name on the line too. That’s not something to be taken lightly. So, if you want to get more referrals, you need to first make sure your services are truly worth referring. Give every customer the best service you’re capable of providing.
- Give customers incentives for referrals-Your customers have a lot going on in their lives. Hate to break it to you, but telling other people about your business is on the bottom of their to-do list, right below cleaning the mouse poop out of the attic. This means you need to motivate them into referring you, and the best way to do this is to give them something in return for doing so. You can give them a discount on future purchases for each referral they give, or you can even offer cash rewards.
- Don’t be afraid to ask-Again, your customers have a lot going on, so they’re probably not thinking about you. The thought of referring you to a friend may not have even crossed their mind. There’s nothing wrong with asking for referrals. If you’ve provided great service and the customer is happy, ask them to please tell their friends and colleagues about your products and services. Many times, they’ll be happy to do it. One note: Don’t ask for the referral right when you send your bill. That’s a bit pushy.
- Partner with complementary businesses-Let’s say you run a web design business, and you want to get more clients. One way you could get more referrals would be to partner with copywriters who have clients that may also be looking for design services. Look for complementary businesses that you can swap referrals with.
- Look for networking opportunities-You don’t want to be “that guy” who is always pitching and selling, even in relaxed social situations. However, you should let people know who you are and what you do. Even if they don’t need your services, they may know someone who does. Keep your business card on you at all times!
Does your business generate a lot of referrals? What have you done to get all these referrals? Share your favorite tips by leaving a comment. You could be helping a fellow entrepreneur!
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25 Responses to “How to Generate More Referral Business”
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Keith
30. Jun, 2010
I think the biggest one people miss out on is just asking for the referral! It’s like being in sales but never asking for the sale….
SuccessLadder
30. Jun, 2010
Great post, very informative. Keep up the good work, Thanks.
aggelies
01. Jul, 2010
Also you could get a testimonial from your existing clients and with these you could target new, prospective clients and referral business partners.
Andrew @ Blogging Guide
01. Jul, 2010
Nothing workd best than the referral system. The best advertising strategy is through word of mouth so be sure to really take care of your customers.
Escort Service London
01. Jul, 2010
Referral system works best when you are really capable of convincing people at your own best.
JohnAtBlogtrepreneur
01. Jul, 2010
Thanks all for the great comments. I totally agree with Keith that people often forget to ask for referrals. And just as in sales, not asking for the sale or the referral is likely due to a fear of rejection, but no one should let that stop them! What’s the worst that could happen? You learn.
Email Marketing Blog
01. Jul, 2010
I think the first two points in your article say it all – Hard work and incentives. Taking care of your top work referrers can pay off, both figuratively and literally. :)
viral marketing
01. Jul, 2010
I guess there are two main types of people who refer others. Those that get something out of it and those that truly had a great experience.
Credit Girl
01. Jul, 2010
A strategy that has worked for me in the past is networking. I think that is one of the biggest keys to succeeding in our society. You’ll just land in the right hands when you network with the right people.
lingerie
01. Jul, 2010
We usually send a bring your friend and both of you guys get % off coupon cards. Most of the time impressing the current customers lets them share those cards so we get great flow of incoming traffic.
used tires
01. Jul, 2010
In regards to the networking, I feel that’s one of the toughest things to do, the hard part for me at least, is how I begin the approach, and what’s the angle I try to bring in, to get them to notice me, even if I am not “pitching”. I guess though it comes with experience, the more experience you have with the talking/approaching, the better your results will be in the long run. Perhaps, also the biggest thing to do is not to get too bent up about some networking relationships that may fail.
Till then,
Jean
South Florida Pool Builders
01. Jul, 2010
This article goes back to the real fundamentals of having a business. I can say that even during the ruff times we have in our economy, I have always managed to have work, and its all to my customer referrals.
I know it is important to have lots of mediums of advertising, however referrals should be atleast 70% of your new business.
How do you do that…
Spend less time looking for new customers and more time taking care of the ones you have.
Kelvin Forex Indicator
01. Jul, 2010
Marketing through the power of words of mouth is one of the most powerful strategy. This way of marketing usually has higher conversion as compared to other means of marketing.
I like the point of ‘Don’t forget to ask’ as this is one thing that I have missed out in my marketing.
Mark Nasri
02. Jul, 2010
Looking for networking opportunities is the key point mentioned in the post.
Escort Service London
02. Jul, 2010
Yes, having the right mind and concept you can establish good PR with your clients.
Outdoor Cat Enclosures
02. Jul, 2010
Very good post. I like your point about ‘Don’t be afraid to ask” as I think that is very true. Often you have to make the first step and ask if they would like to refer you to a friend. Just make sure that you are polite and friendly and don’t come across to assertive.
cleaning services
02. Jul, 2010
i think one of the biggest things that people shy away from is actually asking fro the referral. So many people find it quite a difficult thing to approach people to simply ask for the referral. Good post. Cheers.
Bidet
04. Jul, 2010
These are great tips, getting referrals are very a very important part of any business and increasing them will also increase your business.
Laptop Briefcases
05. Jul, 2010
Definitely don’t be too pushy when asking for a referral. I recently had someone ask for a referral as soon as he thought the project was complete. He didn’t even wait to see if I was even happy with his service. In this case I wasn’t at all.
Mark Nasri
05. Jul, 2010
Generating business by referral is crucial to success.
Patrick@Reverse Phone Lookup
12. Jul, 2010
Providing Incentives work wonders because it makes customers voluntarily involved in getting referrals for you.
Marriage Information
13. Jul, 2010
When I was a contractor, I would ask for referrals a week or so after the project was complete and I knew the customer was 100% satisfied, it’s really a numbers game, the more you ask, the more you will get, the less you ask…..
Visiam
18. Jul, 2010
When you go to a networking event, or are asking for a referral from a client or alliance to one of their close relationships, what are you offering that client or business alliance in return and why would they do it?
When they know they are helping their relationships by bringing you into their presence. It is not all about us and if your clients or alliances believe that their relationships will be enhanced by your involvement, then you have created ambassadors. Great topic and article.
Car Rental
22. Jul, 2010
If you are provide an extra ordinary service, You would still get referrals. And again here, if you are honest in your business, you will must get referrals.
ankush
07. Feb, 2012
Great post ..I agree with all the points including the ones where the importance of testimonials is highlighting by some one .
For me ..giving an exceptional consumer experience is the 1st thing any organization should do correctly if it has to look at consumers recommending their product