As they may be in the minority, however, there are ways you can help the process along.
Many people find it hard to ask for referrals, but the truth is that some customers just don’t know how much you depend on referrals. And most happy customers will be glad to help you – if you ask. Try taking it one step further than just asking: “Do you know of anybody…?”
For example, you operate a gardening shop and customer Jane Smith is an avid bird-watcher. She’s just bought her fourth bird-feeder from you. You mention to Jane that members of her bird-watching club might be interested in a new kind of binoculars that you carry. They’re light-weight and are great for bird-watching trips.
Could Jane tell her friends at her next bird-watching meeting? She does, and you make sales as a result. The new customer thank Jane. And you thank her by offering her a discount.
2. Offer incentives
Some customers respond better when they know they’ll be rewarded for any referrals. Use your imagination. Make it personal. One customer may appreciate a gift certificate for a good restaurant. Another may prefer cold, hard cash. Other incentives you may wish to consider are freebies or discounts on your product. But make sure the level of incentive is in line with the value of the referrals you receive.
3. Acknowledge referrals
At the very least, acknowledge referrals by sending a thank-you note. People like to know that their efforts are appreciated and they may even respond by sending you more referrals.
My retirement and financial planner tells me that she receives so many referrals that it’s often hard to keep up with them. But when they do get round to sending thank-you-for-your-referral letters, they end up getting dozens of additional referrals in return.
4. Make it easy
Some customers may be comfortable with passing along you business card. Others won’t mind completing a referral form. Keep customers informed of new products and services so they can speak knowledgeably for you. Try suggesting a particular type of company or person within their circle of influence that might benefit from what you offer.
5. Keep track
If you’re dealing with a high volume of customers or referrals, keep some kind of tracking system. Whether it’s index cards or computer records, keep track of who your referrals are from and who’s being referred. Include notes on any acknowledgement you’ve sent, what kind of contact you’ve made with the referred prospect and a note of any future appointments. And keep the information up to date. A customer who has referred ten customers to you in a year deserves more recognition than a customer who has referred one.
Make sure you monitor you system to find out which of the methods you’re using are the most effective. You may have to change the way you do things.
Perhaps you customers just aren’t influenced by a cash offer. If it’s not working, change your approach.
Written by marketing expert Vicky Lenz in ‘The Saturn Difference’ for the June 2000 published edition of Real Business.
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