Need a terrific, proven, low-cost way to build business when times are tough? Finding more referrals and using the ones you have to better advantage is a simple, cost-effective way to gain new business, and regain old customers.
Millions of small-business owners know the magic of referrals, which offer instant credibility for what you sell. So why don’t more of us use referrals effectively?
Here are some tips to getting more and better referrals:
• Implement a referral-generation plan. Referrals aren’t automatic. Some business owners assume that a great product or terrific customer service will generate referrals by default. Not so. You have to learn to ask, and make sure employees are on board as well. Don’t be shy. Most customers are open to being asked for referrals.
• Provide some ammunition. Don’t ask customers to recommend you to others without offering them some backup. It can be as simple as a supply of your business cards, or a link to a special page on your Web site. Or it could be a brochure, your latest newsletter or some other type of printed material that describes what you do and can reinforce the referral.
• Offer incentives. The type of incentive you offer must fit with the kind of business you run. It could be a discount, service credits, an upgrade, a free item or some other trigger that will entice clients to provide referrals. Don’t be afraid to test offers to find out what works best.
• Get the right information. When asking for referrals, consider using a form, checklist or Web-based system that requests details that will make the referral more valuable. A simple name and number isn’t really a referral at all. It’s just a lead.
• Target your most influential customers. If resources are limited, consider seeking referrals only from your most influential customers. These might not actually be your best customers, but they are the people whose opinions would carry the most weight with other people in your industry, community or customer base. By targeting these influencers, you avoid spreading yourself too thin or generating weak referrals.
• Target related businesses. The health care profession is one of the most adept at fostering referrals between complementary disciplines – specialists, imaging services, physical therapists, medical equipment suppliers and others. Consider the same strategy yourself. Contact businesses that provide complementary services to your own and ask for referrals.
Daniel Kehrer can be reached at
editor@business.com.
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