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How to NOT perfectly mess up your most powerful revenue source.

How to NOT perfectly mess up your most powerful revenue source.

February 15, 2021
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“People influence people. Nothing influences people more than a recommendation from a trusted friend. A trusted referral influences people more than the best broadcast message. A trusted referral is the Holy Grail of advertising.” – Mark Zuckerberg

If you are an experienced salesperson or sales consultant then you know that one of your most powerful sources of new business is the personal referral.

These leads are “warm,” meaning the person is willing or even looking forward to your call. They have been identified by the referrer as someone who could use what you sell, so they are a higher-quality lead. Plus, they are half-sold already due to social proof – NICE!

So, establishing a referral program is well worth it.

BUT it’s surprising to me how many people screw it up!

The main problem I see when I refer someone is: they disappear into some kind of BLACK HOLE.

Too many times, I don’t hear back unless I start bugging people. If you have experienced this, you know how aggravating this is. After all, you stuck your neck out in providing the referral, and if something is mishandled it will reflect poorly on you in the end. So the least you can expect is a little info, know what I mean?

It really should be a more professional affair – at least if people want to keep referrals heading their way.

How to NOT screw up referral program

  1. If you are able to, offer some kind of commission. One great way to incentivize people to refer is to pay them. This could be a percentage of the closed deal (10% is typical) or even a $10-25 gift card whether the deal closes or not.
  2. Some industries do not permit anything of value to be exchanged for a referral, such as real estate and mortgage. Or you might object to it on some sort of personal ethical grounds. However, you can at least cross-refer and therefore keep things sort of fair.
  3. Update your referral sources every couple of weeks or so. Not only does this keep them in the loop, but they can potentially help push the deal forward.
  4. THANK the source of the referral, whether the deal closes or not.

How do you ask for referrals?

The simplest way is to ask, at the end of conversations with clients or members of your network, if they know of anyone who might use your services.

You will usually get at least one or two names. Ask for permission to use their name as the referrer, and make your initial contact.

A phone call is most effective, but you could also drop a note with something like, “Our mutual friend Samantha asked me to reach out to you. We helped her with a project last year, and she felt you might be someone we could also help. If you don’t mind, let’s set up a 15 minute chat this week to explore this; please reply with your availability.”

As you can see, the above isn’t that hard to do. Its just that communication has to be maintained for it all to be successful.

At Volo, we have set up many successful referral programs and would love to do the same for you. Give me a call to get something set up. – Shaun 760-815-4464 cell or shaun@volohaus.com

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