How to Reverse Engineer Sales Referrals

Reverse Engineer Sales Referrals

2.4 million: the number of brand-related conversations in the US each day. The question: Are they talking about you?

Referrals are the number one marketing tool for any company relying on new business. In fact, studies show that typically 65% of a company’s new business comes from referrals. Why? Customers trust their friends and family, at least in relation to product recommendations. These referred customers are then 4 times more likely to buy, 18% more loyal, and spend 13.2% more than the non-referred customer.

No brand, no company can afford to ignore referrals.

5 Tips for Getting the Referral

You know you need the referrals, but how do you get them? These five tips will help you put routines into practice to boost those life-giving referrals.

1. Identify where the clients are coming from.

If you don’t already know, then it’s time to see the role referrals currently play in your company. Take a look at the last 1-2 months of transactions and figure out where those customers came from. The most important question to ask yourself when you sign on a customer is, “How did we get them? ” Good sales managers, or sales directors, spend their energy replicating successful activity. If you don’t have a way of determining which activities are profitable, then you’ll spend too much time on the unproductive ones.

Now, put a number to the referrals. For example, if you discover that 10% of your customers are referred to you, start setting goals to increase that 10%. By knowing your base number, you can better measure your efforts to increase it.

2. Compare your referrals with your competitors’ referrals.

See if you can identify the percentage of clients your competitor receives from referrals. For example, if you sell insurance for State Farm, call another State Farm office. If you discover that they get 20% of their business from referrals and you gain 10%, it’s time to figure out what they’re doing differently.

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3. Embed the referral process in your sales conversation

Gaining a referral can be as easy as changing your email signature. If you add a tagline that says, “Ask me why most of my customers are referred!”, you’ve now opened up communication with your clients about referrals and planted the seed for them to refer someone new.

There’s no need to create a referral program or to offer blatant incentives for referrals. It’s better if customers refer because they were genuinely pleased with you. Go beyond offering a great product. Wow people. It’s not as difficult as it may sound.

In a world where most salespeople aren’t doing much to personalize their sales technique, go out of your way to be helpful and kind. Then, call the client after you meet to check in. Most people don’t take the time to make a follow-up call. If you do, your efforts stand out.

4. Ask for the referral.

As a part of that follow-up call, be direct in asking for a referral. After all, you’ve earned it. This part is difficult for some people, but simply saying, “Hey, you know how awesome I am. Could you tell someone else about it?” can do the trick.

Another approach (one you’ll see most every insurance agent do) is asking the client, “Do you have your phone handy?” Of course everyone does. After the client pulls out the phone, the agent says, “While I fill out this paperwork, is there any way you could look through your phone and see some people who would buy what I sell? If you could just look through your call history and pick out three names of people who wouldn’t mind if I call, that’d be great.”

There are plenty of ways to ask. Just find a way that works for you and your clients.

5. Refer those who refer you.

Go above and beyond to thank those who refer you. Maybe you take them to lunch, buy them a gift, or best of all, refer them in their respective industries.

A referral saves you time and earns you money. Imagine you’re in a business where you acquire ten customers a year. If someone refers you just one customer, they just saved you hours of cold calling, hours of countless appointments, hours of follow up with people. If it takes you 100 calls to get two appointments and you only close 50% of those, that referral is worth a lot of time and effort. So give your thanks, put in the work, and keep the referrals coming.

People trust who they know, so use referrals to your advantage. As customers continue their 2.4 million conversations each day about brands, make yourself a part of them.