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Get More Referrals by Asking

Build asking for referrals into your daily activities and see the results.

Ah, referrals. I can't think of a more powerful selling tool.

It's a fact: People would rather do business with people they know--or know of--than with strangers. When you're introduced to a prospect through a personal recommendation, that prospect has a vastly higher comfort level than, say, a buyer you find through cold calling. After all, few things are more reassuring than a positive endorsement from someone you know and trust.

So why is it that, while we all covet referrals, we don't pursue them as much as we should? I think it's largely a matter of developing good habits.

Change Your Thinking
Imagine your business as an infinite web of relationships. Every one of your business contacts has the potential to connect you to dozens of other contacts. The relationships are out there, but they'll likely remain out of reach unless you actively pursue them. It may never occur to your current contacts to broker an introduction. It's up to you to put the idea in their heads.

Don't feel sheepish about asking for referrals; there's nothing pushy or smarmy about it. People won't give you referrals unless you deserve them. In fact, getting a referral is the highest compliment you can receive. Let your customers know you prize referrals, which you'll earn by providing excellent quality products and services.

Make It a Habit
I know one entrepreneur who built a successful business almost solely on referrals. How'd he get so good at it? When he was an eager young sales apprentice, his manager trained him well. Every time he glanced at his watch, which he did often in his zeal to stay on schedule, it meant it was time to ask for a referral. Eventually, it became second nature.

Here are more easy ways to start developing good referral-building habits:

  • When you begin working with a new customer, make referrals part of your initial agreement. "If I do a great job for you--and I will--you agree to give me X number of referrals." Chances are your customer will be impressed by your dedication and drive.
     
  • Whenever a customer compliments you, respond with a thank you, quickly followed by a referral request. For example, "I'm so pleased you're happy with my work. Do you know anyone else who can benefit from my services?"
     
  • Use every client meeting as an opportunity to collect referrals. To keep yourself on track, jot a reminder down in your meeting preparation notes. Make it one of your standard talking points.
     
  • Set a weekly goal for yourself. Keep track of the number of referrals you ask for each day. You don't need to limit your requests to clients; you can also ask business associates, acquaintances and prospects.
     
  • Make the most of every networking opportunity. Step out of your comfort zone at networking events and set a goal to talk to at least three new people. Plan in advance what you might say. We're all drawn to interesting, enthusiastic people.
     
  • Always be specific when asking for a referral. Looking for high net worth individuals? Say so. Interested in midsize companies? Let them know. If you don't tell your contacts who your target customer is, you'll waste time pursuing leads you can't use.

Give and You Shall Receive
One of the most powerful ways to elicit referrals is to give them generously yourself. Whenever you have the opportunity to refer an associate or bring two contacts together, do so. And when you're attending the aforementioned networking event, make a point of introducing people to one another. Most people will appreciate the referral, and it may inspire them to respond in kind.

One last thought: Always thank someone who has given you a referral. Send them a note, keep them informed of your progress and maybe even treat them to lunch.

What's the close ratio on referral business, compared to other prospecting methods? I don't have a definitive answer for you, but I've seen estimates that range from 50 to 500 percent more. Those are big numbers. Whatever that number is for you, you can bet it's a whole lot higher than cold calling, advertising, web marketing or virtually any other sales technique you might employ.

The referral is the number-one tool in your tool kit. Get in the habit of reaching for it often--say, as often as you might glance at your watch.

Ray Silverstein is the president of PRO: President's Resource Organization , a network of peer advisory boards for small business owners. He is author of two books: The Best Secrets of Great Small Businesses and the new Small Business Survival Guide: How to Survive (and Thrive) in Tough Times . He can be reached at 1-800-818-0150 or ray@propres.com .

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