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When you need a product or a service, which provider are you more likely to choose? A stranger you saw in a random listing somewhere, or a professional recommended to you by someone you know and trust? Most people prefer the latter. That is why referral marketing is such a powerful tool, yielding up to a 60% closing ratio versus the 10% closing ratio of unqualified leads. Establishing trust with new customers is vital and can be time-consuming, but utilizing referral marketing can provide something of a shortcut, building upon the trust already established between the referral and your source. Not only that, but referred customers have been shown to spend more money more quickly. It only makes sense, particularly if you are phrasing your requests for referrals correctly. The referral probably came to mind because your source knew they were looking for the kind of services you offer. And think of the savings in sales force you can achieve when your customers generate new business for you. A foundation of trust, more return in a shorter time frame, reduced sales force expense -- why wouldn't you make a referral program a fundamental part of your marketing strategy? And yet many businesses overlook or under utilize this avenue for generating new business. This could be because they are attached to the traditional, seemingly more quantifiable method of cold-calling -- a sticky issue, since it can be hard to teach an old dog new tricks, and probably the reason small businesses are leading the charge in referral marketing, while larger, more entrenched companies resist. On the other hand, they could simply be unsure how to go about getting or handling referrals, concerns that are easily addressed. When you think about getting referrals, the source that comes immediately to mind, of course, is your existing customers. Just be aware that choosing which customers to approach and when is an important consideration. You may not want to hit a new customer up for referrals as soon as you have closed with them. Giving newer customers a chance to get to know and love you before actively seeking referrals from them can result in stronger referrals more closely geared to your needs. Other sources include non-customers, such as service providers with whom you interact outside of your business, suppliers or vendors for your business, and friends and family. The keys to getting referrals that will really pay off include: giving your potential sources a detailed picture of the customer you would consider ideal, rewarding your sources for their referrals, providing the kind of service and customer relationship that will make your existing customers rave about you to their friends, and a follow-up thank you to the referral source. Finally, it's not enough to do all these things if you neglect to take the vital step of asking for the referral. Don't just ask "do you know of anyone who can benefit from our services?", while it is a good question, it leaves your source a fifty percent chance of simply saying no. Ask in such a way that your source only has a choice of "yes" answers. So, how do you handle your steady stream of referrals once you've got it? The best answer is conscientiously and with care. Timely and professional contact with referrals provided is essential, not only to closing with the referral, but also to future referrals from the same source. Prompt contact demonstrates more effectively than any written note that we appreciate the referral provided. Similarly, excellent customer service from the first contact shows that our source's faith in us was not misplaced, and that we respect their relationship with the referral. Service, trust and respect are at the heart of referral marketing strategies and the key elements that make referral marketing so powerful. After all, don't we all want to work with someone we trust, who respects us and provides excellent service? Wouldn't we tell our friends about them?
Article Source: http://sports-articles.net
Jody Murphy, Referral Coach in Orlando, is an experienced direct marketer and part of the team at Expect Referrals. " I have been helping clientsconduct effective direct marketing campaigns for the past 17 years. Having worked on thousands of direct marketing campaigns over my career, I have developed a passion for helping small businesses become successful and gain a competitive edge.
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