Five Keys to Building a Referral Based Business

May 20, 2013 by 2 Comments

fellowship20groupIn doing some investigating and research for this article, I found that there are some pretty standard “keys” to building a referral business. Most of them are rather boring and extremely generic. As I read several articles on the subject, I found myself wondering what really makes a referral based marketing business work. You see, it seems to me that there are some people that are really good at it (seemingly without much effort) and there are those who try really hard and seem to struggle terribly.

So, what are the real “keys” to building a referral based business? I found five that I would like to propose here:

  1. Be yourself! Nobody wants to refer you to their family, friends, or business associates if they see you as “fake” or someone putting on a show. By being yourself, you may not be able to work with everyone. But think of it this way, if someone doesn’t like you for who you are then they will likely leave you as soon as they find someone in your industry that they do like! Be yourself.
  2. Don’t overplay your hand! We all have abilities and talents that make us good at what we do. If someone asks you to do something outside your abilities, just say no! Now in saying no, you might well be able to point these referrals in the direction of someone who can help. Those you re-refer will appreciate your honesty and will look forward to doing business with you when they need what you are good at!!
  3. Be flexible. Take time to really listen to the referral and find out exactly what they are looking for. So many people today go into a meeting with a pre-planned package of information that may not serve them well. When you listen closely to those referred to you and answer their questions and meet their needs, not only will they work closely with you, but they will also become referrers of your service to others!
  4. Do what you promised and do it when you promised. Delays are at times inevitable, but you must serve these referral clients as if the life of your business depended upon them. (And in many ways it does.) Remember these referrals came to you by the recommendation of someone else. If you don’t handle them properly they may not be willing to expand your referral network, but they may report back to the one who referred them causing these first referrers to leave your referral group as well!
  5. Create a follow-up system that never looses a client/customer between the cracks. When your past and current client base know that they are well respected and are always aware of new things you can do for them, not only will they use you again and again, they will refer you to everyone they know who needs your products/services.

This is my list, now what have you done that could add to this list?

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Benefits of a Referral-Based Business

May 3, 2013 by Leave a Comment
Business Sign X

(Photo credits: www.roadtrafficsigns.com)

Over the past two weeks Maxine Brand has graced our groups open houses with her wit and wisdom. Her talk discussed the benefits of building a referral-based business. But, instead of trying to relate to you all that she said, Maxine is allowing me to make her notes available to you.

I hope that you both enjoy these notes and that they will help you in building a solid referral-based business!

Benefits of a Referral-Based Business – Maxine Brand

What is a referral-based business:

It is a structured and systematic process to maximize word of mouth potential.  Does this by:

  • Encouraging
  • Informing
  • Promoting and
  • Rewarding

Customers and contacts to think and talk as much as possible about their company, product and service and the value and benefit that entity brings to them and people they know.

 

What are the benefits of a referral-based business:

  • Referral programs are an effective way to attract higher quality customers.
  • Referral customers have a higher margin than other customers.
  • It is much cheaper to have customers find you than for you to seek them out via traditional marketing methods like advertising.  You’ll immediately become more profitable.
  • Referred customers stay longer as customers than other types of customers.
  • Referred customers have a higher customer lifetime value.
  • Referred customers tend to cycle self-perpetuation with more satisfied customers referring others to your company.
  • Referred customers come to you with a higher level of trust and will tend to have a stronger sense of loyalty right from the start.
  • If the proper questions are asked to determine if this is going to be a good fit, you will find the referred customer is the kind you want and ENJOY working with.
  • Your business building efforts become more targeted and you are effective in reaping greater rewards.
  • You can better calculate the “bang for your buck” in terms of marketing dollars you are getting.
  • Referral marketing reduces your sales cycle.  With less time calling cold prospects, your business can focus on customers and their circle of influence.
  • You tend not to have to defend your prices or services.  They are essentially already sold on you and what you do.  Quality becomes the priority consideration.

Obstacles to creating a successful referral-based business:

  • Getting distracted and lose focus
  • Become overwhelmed with other activities and put it on the back burner
  • Don’t have time when you are meeting with clients to talk about referrals
  • Uncomfortable in finding a way to bring it up
  • Don’t follow up on referrals you get
  • Tell yourself you are too busy for referrals and avoid having the conversation at all with prospects

Take action now to change by:

  • Partnering with a colleague to focus on referrals
  • Read a book about how to effectively acquire referrals
  • Sign up for a class that teaches you about referrals
  • Join one of Dave Wellman’s Referral Groups

Are you deserving:

  • Don’t offer too many different services
  • Build a reputation about being an expert on one thing
  • Deliver on what you promise
  • Understand the expectations of your customer

Strategy for building a referral-based business:

  • Educate your audience on how to refer you
    • Define your ideal client
    • Define your value proposition
    • Define your process
    • List your potential “askees”
    • Put a system in place for follow up
  • Create referral agreements with key “power partners” so your they will introduce your services to their clients and you will do the same for them
  • Systematize your efforts.  Send out a monthly letter or email to your referral partners to let them know what is new in your business
  • Keep track of your leads and check in regularly prospects
  • Offer a gracious and generous thank you to those who refer you.
  • Treat your referral sources with the utmost care
  • Find someone who can:
    • Hold you accountable
    • Provide you with support when you need it
    • Provide input and opinions about asking for referrals
    • Help you celebrate your victories
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Open House – Come Visit Referrals Quad City!

April 19, 2013 by Leave a Comment

I 74 BridgeThe next two Tuesdays, Referrals Quad City will be hosting open houses in our two groups. Our breakfast group open house will be held Tuesday, April 23rd at 7:00 am at the Chophouse Restaurant in the Radisson Hotel in Davenport. Our lunch group will host its open house Tuesday, April 30, at noon at the LaFlamma Restaurant in Moline.

If you would like more information just email me and I will get back to you right away. We need to have the RSVP for the Breakfast meeting by Monday (4/22) and for the Lunch meeting by Thursday (4/22).

If you want to know more about Referrals Quad City click here and you will get the basics, click here and you will see the rules!

We look forward to visiting with you in one of these two meetings!

 

Dave Wellman, FounderReferrals Quad City

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Training a Referral Network

April 6, 2013 by Leave a Comment

referralI remember hearing a friend of mine tell the story of how he had reached a point in his business where he was working with his current client base and their referrals exclusively. No cold calls, no paid advertising, no other form of new client acquisition. He worked exclusively making his clients the best cared for clients in the industry and accepting their referrals exclusively as new clients for his business and their benefit.

WOW!! Wouldn’t that be an awesome way to work. Every day making sure your current clients had all that they needed from you (plus a little extra) and letting them expand your business by being your unpaid but still crazed sales force working feverishly sharing the benefits of your expertise to all their friends, family, and acquaintances.

Well, that should certainly be your goal! And to achieve that goal there are three things you can do train a referral network:

  1. You need to provide “knock out” customer service. Your clients need to know that you have their backs and that they can count on you to provide them premiere service in the area of your expertise.
  2. You need to make sure that your current clients know that you are ready and able to take on their friends, family, and acquaintances as new clients when and as they need your services.
  3. You need to educate your current clients to “screen” their referrals so that they only bring you people you would enjoy working with and who would enjoy working with you.

As someone once told me, “This concept preaches easy, but lives hard.” What they meant was it is easy to know what to do to get your current clients referring, but it takes more than just knowledge, it takes strong and steady effort. You must work on these three thoughts daily and make them the central theme of your business to truly be transformed to a “by referral only” business model.

When you train your own referral network you will find yourself sitting in the cat bird seat! What do you think? Are there any other things that you think need to be done to create this referral based business model?

 

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Another Thought About Referrals

February 26, 2013 by Leave a Comment

I am reading a great book (Work By Referral – Affiliate Link), written by two great Realtors, Brian Buffini and Joe Niego. Brian was born in Dublin, Ireland. Growing up he worked in the family business as a painter. At the end of the day, Harry, Brian’s Grandfather would ask him a simple question: “Can you put your name on that today, Brian?”

33_ways_to_stay_creative-500x646This simple question about the effort you put into your work is as profound as any question that could be asked concerning your business, your work, and your life. Only when your goal is to do a job well enough that you would want to put your name on it, will you find the path to building a strong and successful referral based business.

Once in the states and living the life of a “successful realtor” Brian was reminded again of his Grandfather Harry and his daily question about the quality of his work. He had reached a point where industry honors, agent rankings, etc. were not getting him where he wanted to be. It was in this moment that he decided that exceeding his clients expectations, working in such a way as he would be willing to put his name on the results would not only provide him with the lifestyle he desired, but would also put him in a position to build his business by the referrals of his satisfied clients.

Every business owner and hard working sales person knows the value of a satisfied client. What they don’t always understand is that getting that satisfied client requires Grandfather Harry’s question, “Can you put your name on that today?”

Well, the answer to that question now rests with us! To answer YES means that our clients needs have been more than met and that they will be willing to refer those closest to them to the product/service we sell. If Grandfather Harry would point his finger at you today, how would you respond?

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Referrals Quad City – Phase Two

January 30, 2013 by 2 Comments
The Redstone Building in Davenport, Iowa, whic...

The Redstone Building in Davenport, Iowa, which was home to the original Von Maur department store and is now home to the River Music Experience. (Photo credit: Wikipedia)

We are nearly one month into the new year and I am excited about the changes going on here at Referrals Quad City. When we started in June of 2012, I always thought that as things progressed that we would have both the opportunity and the desire to expand. Well, as of February 5, 2013 we are going to do just that!

On Tuesday, February 5, 2013 Referrals Quad City is going to begin hosting our first lunch group! It will be held at the Radisson Hotel in downtown Davenport (111 E. 2nd Street) from 12:00 to 1:30 pm. Theresa Jones is going to head things us as the group coordinator and we are expecting exciting things out of this new group.

Besides the addition of this first of four new groups planned for this year, we are also expanding the training portion of our business plan. We are looking forward to working with some of the premiere trainers and business coaches in the QCA. Our goal is to create a great working relationship with powerful trainers/coaches in the areas of Public Relations, Marketing, Organizational Develop, Branding, and General Business Practices. These great teachers will attend our meetings regularly to help our businesses, agents, and company employees develop the strong business “know-how” to be successful in the highly competitive and every changing business market. Along with those we bring in from outside our groups, we will also be working together regularly as mastermind groups, helping each member solve problems and grow their businesses to new levels of success!

Along with this emphasis on training we are going to continue to improve our networking and referral skills that will allow each member of each group to receive a steady stream of solid referrals as a benefit of active participation with Referrals Quad City!

And of course we are also going to emphasize and help to promote the charities and nonprofits that each group member feels drawn to help. Only when we give back to our communities can we really claim to be successful in the ways that really count. This emphasis on giving back will always be an emphasis of our groups.

So with lots to look forward to in the new year, we at Referrals Quad City are looking forward to what lies ahead. If you have an interest in knowing more about our groups, our mission, or are just curious to meet us, please call or email me at any time. I would love to share our vision with you!

Dave Wellman
Referrals Quad City
563-484-4288
dave@wellmangroupinc.com

 

 

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Referral Marketing and Local Business

October 22, 2012 by Leave a Comment
English: Creating lifelong customer value with...

English: Creating lifelong customer value with your business. (Photo credit: Wikipedia)

It is said in business that it is always more expensive to gain new clients than it is to keep existing ones. I think that there is one caveat to that statement and that is “unless the new clients come as referrals from existing ones.”

The most important (and most often under used) form of marketing is referral marketing. No one wants to put pressure on clients to “force” them to give us names of other people they know for our business gains. That is understandable and certainly true if you have to force people to refer you.

However, if you are providing the best products/services available to your current clients and doing so at a reasonable price, caring for them even above your own success, you will not have to “force” them to do anything. You see, the key to a successful referral marketing strategy is to take care of your current clients so well that they will refer people to you just because of what you have done for them.

It will be easy to talk about you if you are providing that kind of service. You will stand out among other businesses of your type AND your client’s friends, family, and acquaintances will want to know more about you.

The key in this whole thing is to understand how to create a referral marketing strategy that works. Let me leave you with three thoughts on the subject:

1. Provide your current clients with the kind of personalized service that they cannot find anywhere else. Building relationships with your clients is more important now than at any time in the past 25 years.

2. Remember to extend that personalization to your client’s family and non-business related interests. Recognizing that your clients have a life apart from work, or the products/services you sell in your business make it more likely that they will introduce you to their family and friends.

3. Take care of those referred to you as you would with anything of great value. Remember, your handling of someone’s referrals may mean their continuing to do business with you as well as the one referred.

The easiest way to build a business is to learn how to develop a referral marketing strategy. Word of mouth advertising is still the best and least expensive way to gain new clients. If you work at and build a good, solid referral base, your business will become stronger in any economic climate, but it will also provide a valuable service to more and more people each year.

 

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100% Referral Business

July 26, 2012 by Leave a Comment

What would your business be like if, instead of spending time and resources trying to chase down and secure new clients, you walked into the office everyday to find a new set of potential clients waiting to talk with you? Would it change the way you do business? Would your attitude toward life/business be different? How would it make you feel?

Many business people begin their businesses by making the choice to build what they hope will become a 100% referral business, but as time goes on that dream seems to give way to the harsh realities of making ends meet month after month. In the end, an occasional referral is great to get, but how to build an entire business eludes most business owners.

If your plan from the beginning was to build a 100% referral business and you have not yet given up on that dream, here are a few suggestions that might well move you forward in the fulfillment of your success plan:

  1. Learn to do such an excellent job for your current clients that referring you is easy for them to do. If your business practices bring any frustration to your current clients, it will be very difficult for them to refer you with confidence. Make sure that you take care of them and that you deliver on all that you promise.
  2. Learn to handle the occasional frustrations that occur in business immediately and to the advantage of the customer whenever possible. My daughter was recently frustrated with how she was treated by a company and mentioned that frustration to her friends on Twitter. The company, who monitors their company name on Twitter (hint), saw the tweet and immediately responded to her frustration, made things right, and won back a customer. That is the way referral businesses are built!
  3. Learn to ask confidently for referrals. If you are providing excellence to your current clients and handling any frustrations that might come along to their satisfaction, then why would you not ask if you could do the same for others they know who could use your product/service as well. If you just wait to see who will refer you, you just might starve (or at least go out of business)!

While this is certainly not an exhaustive list, or even a particularly brilliant one, I would like to remind you of the old adage, “Don’t knock it till you’ve tried it!” Most business owners will agree with these simple points, but most will not take the time to put them to practice. If you do you will stand out from the competition and could be the one to build a 100% referral business!

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Helping the Group Market

July 13, 2012 by 2 Comments

As the Quad Cities premier referral, business connection, and networking group, we should all be working hard helping each member of our group market their specialties. The “million dollar question” is, “How can I do this in an effective and beneficial way?”

Here are a few suggestions that I hope will help:

  1. Have a cup of coffee with each group member and learn all you can about them, their passions, and their business specialty. If you don’t really know someone, their motivation for doing their job or being in business, or what exactly they are good at, it is really hard to market them with people you meet.
  2. Read/subscribe to each members blog (if they have one). By getting regular updates from the writings of our members, we can learn about and understand industry trends that will help us to recommend our members to our family, friends, and business connections. By the way, if you have a thought that would add to the conversation, leaving a comment at the end of a post will add content to their blog and help their rankings in the search engines. This will allow more people to find them as they search the members specialty online.
  3. Follow each member on Twitter, LinkedIn, and even like their Facebook page. These social media helps are like passive word of mouth advertisements for our group members. Every time someone clicks “@referralsqca” on Twitter and sees our web address, there is a possibility that they will visit the site, learn something new, and contact us about the group. The same thing is true about every members Twitter account, website address, facebook page, etc.

These are just a few easy steps we can all take to help the whole group market their businesses. As group members, we have become “cogs” in the referral engine for each company represented. Let’s do our part for each member of the group!

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Built-in Community Component

June 20, 2012 by Leave a Comment
Cover of "The Referral Engine: Teaching Y...

Cover via Amazon

I am reading an incredible book by John Jantsch entitled The Referral Engine (affiliate link). In my reading today, I came across the case study of a company that needed plastic bottles for the packaging of their first product. In order to meet their need, they decided to work with area schools and pay them to collect plastic bottles for to meet the demand.

As I read this story three things came to mind about the convergence of business needs and community involvement:

  1. When creative businesses look at the community as a source of value rather than just one for sales/profit, great ideas that benefit both can be brought to life. (This company got the bottles that they needed and the schools and organizations got the money they needed to better their efforts in the community.)
  2. This convergence of the needs of a business and the needs of the community can spawn whole new ideas beyond the one that originally brought them together. All that it takes is a continuing effort between business owners and community leaders.
  3. Businesses that create this built-in community component will create a level of good will with the community that will certainly spark a word-of-mouth campaign that will bring referral customers into the business.

As I thought about these three things, I wondered how I could promote this kind of community involvement in my business model? How about you? What ways do you or could you engage the community in the development of a built-in community component?

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