Growing your referral business isn’t always a comfortable process. While you can play the build-it-and-they-will-come game, we all know that getting referral business requires active planning and execution.
85 percent of small businesses say word-of-mouth referrals are the number one way that new prospects find out about their businesses. Influitive, an advocate marketing firm, found that referrals have a higher conversion, close faster, and have a higher lifetime value. Evidence like this makes it clear that a referral process will keep your business growing.
Building a referral process sounds simple in theory, but there are three things standing in the way for most businesses.
- Personality: It takes a lot of self-motivation and confidence to ask someone who just did business with you to fork over the information of their friends and family.
- Tact: This is more of an active/trial-and-error to refine your approach and process.
- Direction: When you’ve got someone ready and willing to help, you have to provide clear direction in what is expected of them.
When properly addressed, these are the 3 best-kept secrets for getting referral business.
1. Get Over Your Fears and Get Started
Long before you ask for a referral, you need to overcome your fear of asking for referrals. In short, the longer you wait to get started, the more you’re missing out on referral business.
Hubspot published a helpful blog post on the best ways to ask for referrals. Included in this post are ways to encourage referrals that don’t mean directly asking for one. For example, they mention helping small business owners get into the “referral mindset.”
Essentially, this means you get what you give. By introducing your contacts and acquaintances to people in your network that can help grow their businesses, chances are good they’ll feel inclined to do the same for you.
Remember that happy customers are happy to help you grow your business. Don’t be afraid to ask for their help.
2. The Right Time (and Way) to Ask for Referrals
The best answer we found on this topic is basically when the relationship is strong enough relationship to ensure their trust and belief in you. It’s definitely not the moment the transaction has been completed!
We know this answer isn’t exact. You’ll have to assess the relationship with your client, making it tough to give a universal recommendation. Professionals need to find their own best time to make a referral ask.
Two questions to ask to determine when to ask for referrals:
- Has value been provided and recognized by the client?
- What’s the personality of the referral-giving client?
Obviously, if the client has yet to receive value from the service provided, the timing isn’t right. You don’t see real estate agents asking for referrals prior to closing on a new home.
On a similar note, you need to make sure the client is aware of the value, too. Asking for referrals immediately after a contract has been signed still might not be the best time.
Oftentimes clients need some time to process a large transaction, life change, whatever the case may be before doing any favors. That’s why this is such a case-by-case answer.
Also, take into consideration the client’s personality. If they are Type-A and assertive, then a direct ask would be well received. However, if your client is passive and more introverted, a direct ask might turn them off. Approach them with more finesse since these personality types need more time to fully trust you and the process.
Regardless of your client’s personality, prep them throughout the sales process to be ready to be asked. When you’re sure your client has received value from your services, that’s when you ask. Most of all, be conscious of your audience as you make your approach.
3. Teach Them How to Refer…and Ask!
You’ve found the optimal time to ask for a referral and have your approach figured out. You’re now faced with the third challenge: teaching them what to do and helping them do it.
There are three types of referrals you can ask for from your clients, and you’ve got to decide which type you want from them.
1) Traditional Referrals
This is when you thank your clients for their continued support of you and ask if they have any friends that could benefit from your services. Depending on your industry, you might be able to incentivize these requests, too (we can help with that).
Even after being referred to you by a friend, people will still take the time to check you out online. Hubspot found 70 percent of people trust consumer reviews online. That’s why testimonials on your site help convert referral leads even when you’re not part of the process.
3) Online Recommendations and Reviews
While this doesn’t directly put a new lead in your hands, reviews and recommendations on your site and third party sites are a huge boon for your business. 85 percent of consumers trust online reviews as much as personal recommendations.
So when you’re asking your clients for referral business, ask them for a specific action and be specific about what you’re asking them. For example, “please leave me a review on my Yelp page about our time working together.” This is the biggest improvement you can make in your referral process.
Start Getting Referral Business Now
Referrals are the lifeblood of most small and medium-sized businesses. Whether you’re a realtor, loan officer or salon owner, the three secrets to getting referral business are the same:
- Happy customers are happy to help you, so worry less about asking.
- The best time to ask for referrals is after your client has received value from you and they communicate that to you.
- When someone is ready to help you out, be ready to make the process easy for them.
Last Updated February 2019