Generating Referrals

When I moved to New York City 20 years ago, I needed a dentist. I asked a colleague to recommend someone. She enthusiastically referred me to her dentist, and I still go to him. So do my brother and sister-in-law. And her sister and brother-in-law.

Referrals—personal recommendations—have always been one of the most effective ways businesses attract clients, and today potential customers check strangers’ reviews on the Internet as well as seek referrals in old-style conversations like the one that led me to my dentist. Here are five ways to encourage recommendations:

1. Remind customers to post online reviews.

Marci Zimmerman, founder of Delete tattoo-removal service in Phoenix and Boston, says online Yelp reviews garner more clients for her than any other source. Her staff encourages customers to candidly share their experiences online. Building a web following also helps your business appear higher in web search-engine results without paying a cent.

2. Ask directly for the referral.

Florida business coach Jennifer Lee suggests ending every encounter or telephone conversation with a satisfied customer (or business associate or mentor) by asking at least one of these questions: Who else? Where else? What else? “You invite the other person to be part of your growth,” Lee says.

First, “who else” (a company or an individual) could benefit from my products or services? “Most of the time,” Lee says, “they’ll think of someone, and in the same breath they’ll say, ‘I should connect the two of you.’ ”

Next, “where else” do you think I should be networking? “If they recommend an event, you can meet there and walk around together for introductions,” she  says.

Third, “what else” would help me get more traffic? “When they feel that they are a valuable part of your solution, they move mountains to make it happen for you.”

3. Reward referrals.

You can pay people a set fee or commission for referrals, or you can offer a free gift or a free or discounted service. If your business hosts occasional educational events, you could reward the person with free admission (for example, a garden center’s tomato-growing lecture or a clothing boutique’s demonstration of creative use of accessories).

4. Encourage sharing.

If you create quality content on your website and in regularly scheduled newsletters, include “share” buttons on every page. Set up this content so readers can post your content on their Facebook, Twitter, Pinterest, LinkedIn and Google+ pages with one click.

All major email-handling programs offer simple buttons for recipients to forward the content as well. You can even go so far as to say, “Like this newsletter? Feel free to share it with your fans and followers who would find it valuable, too.”

5. Thank everyone who refers you.

When someone goes the extra mile for you, they deserve to be thanked even if the referral doesn’t result in a sale. A personalized email or handwritten note lets them know you appreciate that they thought highly enough of you to stake their reputation on recommending you. You should say that you enjoyed connecting with their contact and that you look forward to serving their referrals in the future.

And be sure to reciprocate referrals. You’ll reap more recommendations if you, in turn, provide referrals that meet the needs of the parties you connect.

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