Why You Never Get Referrals

Believe it or not, the vast majority of your real referral opportunities are going to come from your customers’ routine conversations with their friends, family, and associates well AFTER the moment of sale.

But conventional referral-getting wisdom says just the opposite, doesn’t it? It says the best time to get referrals is to simply ask for them right there when the customer is buying from you. I’m not saying you shouldn’t ask for referrals at the point of sale, but I am saying that the vast majority of referral opportunities occur much later, after the sale.

I don’t walk around with a mental inventory of everyone I know who might need telephone service. Or a laptop computer. Or a new swimming pool. Or any of the 716 things I might happen purchase during the course of a year.

Most salespeople are all-too-familiar with the “I can’t think of a single soul who would want one of these” problem. That’s why almost everyone has quit asking for referrals at all, and why referrals for your company probably don’t exist. And even if you do get one once in a while, it’s more like finding a $20 bill in a jacket you haven’t worn since last year. Not exactly a product of careful planning.

The secret to getting lots of referrals, then, is to make sure that your customers are ready and willing to recommend you when the topic of conversation naturally makes it way around to whatever it is you sell. Making this happen takes a little effort, but is very doable. Here are the four main steps:

1. Get Real

The first thing you’ve got to do is align your expectations with reality. Your customers have better things to do with their time than sell junk for you. Think about things you’ve bought and how anxious you were to go out and get your friends to try. Not very anxious, right? And even if they are anxious, they still don’t honestly know anyone right now who needs what you sell. This is called reality. Deal with it.

2. Focus On The Customer Experience:

The number of referrals you get will depend heavily on how good you make the customer experience. Innovate your business so there’s a reason for people to want to do business with you. Find out what people hate about doing business in your industry and remove those obstacles. Under-promise and over-deliver. You know, all the basic customer service stuff that you probably should be doing better.

3. Pro-Actively Reward Your Customers:

Send your customer a thank you gift. It serves two purposes: 1) It’s a good way to say thank you (duh!), and 2) you can thank them in advance for getting the word out about you to their friends and associates. The gift should be something of real, tangible value that’s commensurate with the size of the sale or the likely size of the lifetime value of the customer.

You can’t go wrong with a restaurant gift card, and if you’re feeling extra saucy, send them something that’s a literal gift in a box.??The idea here is to invoke the law of reciprocity—you’ve done something nice for them, now they’ll feel obligated to do something nice for you. They’ll be sitting there eating at Chili’s on your nickel and start to feel guilty if they don’t help you out somehow. If you think that sounds sneaky and manipulative, you’re probably not married. Or at least not happily married. This is called human nature—it’s how we operate. I recommend that you have one specific person in your office that’s responsible for the gifts, and I strongly recommend that you keep this program simple.

Make sure the gift goes out within a day or two of the transaction so it lands while the customer is still thinking about the purchase. If you’ve done a good job delivering a great customer experience, this gift should have the effect of being a giant exclamation point at the conclusion of a good experience.

4. Ask For Referrals In a Systematic, Consistent Way:

You can hope that your salespeople remember to ask for referrals at the point of sale, or you can take it on your shoulders to pro-actively ask for referrals on an ongoing from the corporate level. As has been stated above, people are going to get busy with their lives, and 12 months after they bought from you, they might not even remember your company’s name. So fix that by sending them a steady barrage of mailers to remind them. Not emails—regular mails. Send them at least one postcard per quarter thanking them again for their business, and asking them to mention your name if the situation comes up. You might even want to send more gifts later on. For example, a pool company I know about sends their customers an annual anniversary present—a pool toy or towel or goggles or something—as a way of keeping in front of their customers’ face. Top of mind, so to speak.

The idea is simple—by using this four-step methodology, you’ll anchor the customer to a good experience with the innovative company and thank you gift, then remind them on an ongoing basis that they had a good experience. Then the next time the topic of (what you sell) comes up naturally in conversation—BAM! Referral.

Or you can just leave it to chance and see how that works out.

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