How To Set Up Dynamic Referral Systems - Part 1

YEARS AGO WHEN YOU MOVED INTO A NEW HOME, WERE YOU EVER VISITED BY THE "WELCOME WAGON?"

Years ago when you moved to a new town the local Welcome Wagon lady used to pay every new family a visit, bringing a basket of goodies and freebies from various local businesses.

This was a great marketing idea since recommendations are the number one motivation for many people to try out a restaurant, doctor, dentist, gardener, or a myriad of other service providers.

The personal referral is unbelievably more powerful and important than picking up the local paper or perusing the Yellow Pages. How many times have you gone to a business because someone gave them a good recommendation? Even though the person giving the referral may be a complete stranger, there is something about a live person recommending a specific product or service that gives it legitimacy.

Most people today don't want to take the chance they won't get good service or enjoy the food at an unfamiliar restaurant, so a recommendation from someone takes away their fear of making a poor choice.

HERE'S SOMETHING ELSE TO PONDER

Can you think of any business you've been to lately that asked you to give them some names of people you know who may be interested in their product or service? I'm talking about referrals, and most businesses miss out on what could prove to be their ultimate marketing tool… the personal recommendation.

The average business simply provides you with its products or services. In the case of a restaurant, they provide you with food. In 99% of restaurants, when you go to the register to pay for your meal, all they do is take your money and give you a receipt. They believe if you liked their food and their service you'll probably tell someone else about them eventually. That's called a "passive referral" and it typically brings them a few new customers, but not in any significant numbers. Basically, it's like throwing something against the wall and hoping it sticks.

It makes you wonder why more businesses don't realize the power of their customer's influence when it comes to generating a massive number of referrals. It only requires them to ask for those referrals. People trust what others tell them about a business, both good and bad.

A business that "gets it" can leverage that trust and satisfaction with its products or services. If you're enthusiastic about a business, wouldn't you be happy to refer others to them so they can enjoy the food… or the excellent work performed by their painter or handyman?

Now, what if we take this further and offer an incentive program to the customer providing the referrals? Can you imagine how something like this could motivate a consumer to give as many referrals as they can?

So what would be a good reason for a business not to employ this powerful prospect-building model? This strategy is virtually no cost, no risk, and little to no effort.

In addition, the loyalty factor for a highly satisfied customer is off the charts. The referring customer feels a certain sense of responsibility for recommending the business since they want others they care about to know and experience the same excellence they were treated to. And when their referrals experience the same results they did, it enhances the reputation of the referee and grants them a measure of prestige that's so common in all human beings.

USING THE POWER OF REFERRALS

Would a powerful referral system that ?????????????????? ???????? "???????????? ????????" ???? ??% ???? ????% ???? ???????? help improve your business? Making more money is always the goal of every business, yet most business owners leave tremendous sums of money on the table by not having dynamic referral systems in place that excite their customers enough to recommend their business to others?

Once you have such systems set up, all it takes is follow-up by yourself and your employees. Creating a referral system that rewards your employees and customers is not only possible but simple once you have your system in place. Making sure your employees are on board with the plan and trained to use it is important if you truly desire to get referrals on a steady basis.

A DYNAMIC REFERRAL SYSTEM CAN PRODUCE A MAJORITY OF YOUR CUSTOMERS.

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Because most people just find it difficult to make choices about mundane things like shopping or restaurants, they would prefer that someone they know gives them a suggestion or referral. This process removes the stress from their decision about where they should shop.

Most folks love trying new places after receiving positive recommendations from friends or associates. They feel if "Sue" or "Joe" says the place is good, they'll have a positive experience as well.

People want instant gratification and direction on what business to try, especially when the product or service doesn't play a major role in their life.

???? ?????? ?????????????? ????'?? ??????% ???? ??,??????% ???????? ???????????? ???? ?????? ?????????? ?????????????????????? ?????????????? ???? ?????????? ?????????????????? ???? ???????? ???????? ???????? ???? ?????? ???????? ?????? ????????????????? Many businesses spend 15% or more of their total revenue on their advertising budgets… yet their referral customer base is twice that of the clients who come to them through paid advertising!

With the hundreds of categories of referral programs available, we can put our attention on two that are proven and tested, have a successful track record, take very little time to implement, and require little to no money or personal risk to put into action.

THERE ARE SEVERAL TYPES OF REFERRAL SYSTEMS:

1. The "Static" Referral System -?your customers are informed of your referral program and understand the "perks" they will receive from sharing information about your business with family, friends, associates, and anyone they meet who shows an interest in your service. This system involves a concerted effort and approach in which you ask your happy clients or customers for referrals and gladly reward them for their efforts, yet you won't be directly moving the process forward.
2. The "Proactive" Referral System -?in this system you will be directing the entire process that gives you the power to reach potential customers who have been influenced by their friends or associates. They're prospects who, under normal circumstances would never have heard of you or your business.

You're motivating your customers to become "promoters" of your business or service by enticing them to share information about what you do with anyone and everyone they know.

So how do you take a basic referral program and turn it into a super-charged, systematic, and much more powerful "Proactive" Referral System? Let me highlight several of my own experiences to illustrate both techniques.

I recently became aggravated by my chiropractor due to his lack of passion for his work. I decided it was time to find a new one for myself and my family. One morning I was outside picking up my newspaper and one of our neighbors was walking his dog. He asked me how I was doing so I shared with him my irritation with my current treatment from my Chiropractor.

The words were no more out of my mouth when he began praising his Chiropractor and explaining to me how caring and professional he was. His recommendation was so strong (people LOVE to share this kind of information with anyone who will listen), and he told me that at least four of our neighbors were using him as well. Needless to say, my whole family began seeing him and we've spent thousands of dollars on adjustments.

Now consider this. Did this Chiropractor have a referral system set up for his business? Not in the least. I later discovered he had no referral program in place whatsoever… just a Yellow Page ad and some local radio spots that were costing him huge amounts of money. If he were to do a minimum of research I'm sure he'd discover that many of his clients are referrals coming in from his client base.

His saving grace is his personality and expertise as a Chiropractor. His staff is considerate, and concerned and treats each patient with kindness. You almost feel as if you're part of their family when you walk through the door.

Basically, the Chiropractor gets referrals from this "static" method due to his superior service and his ability to build relationships with his patients. Unfortunately, he lacks a true "static" referral system since his patients are NOT directly asked or actively given referrals. In many cases, they may not be referring him due to the fact they aren't aware of the scope of his business, and the various treatment modalities he offers nor are they offered benefits or perks by referring him to their circle of influence.

If he created a formal system that rewarded referrals he could grow his client base enormously with no out-of-pocket expense and see his business grow much more rapidly.

The simple solution is to put into place a system where he trains his staff in the art of "asking" for referrals from every single patient… every time. His referral success would grow even more if he sent a follow-up letter to them highlighting the advantages and perks they could receive from each referral, such as discounts, complementary treatments, etc. This would incentivize them to tell as many new people as possible. Now the doctor has his patients "marketing" on his behalf.

NOW FOR THE "REFERRAL GOLDMINE" THAT CAN UP THE NUMBER OF REFERRAL CLIENTS BY AN ADDITIONAL 200%-300%.

Let's turn the "static" system into a more powerful model that creates what we call the Proactive Referral System. The Chiropractor could provide his clients with a free trial coupon… complete with a complimentary x-ray and adjustment for one person. The other side of the coupon details all the benefits and perks with bullet points highlighting the advantages our Chiropractor provides over other Chiropractors in the area.

THE SECOND TIER OF THE PROACTIVE REFERRAL SYSTEM INCREASES CLIENTS BY ANOTHER 100% - 200%.

The Chiropractor obtains four or five written testimonials from other happy clients who live on my block. Then the Chiropractor (or someone in his office) creates a compelling letter mentioning those neighbors by name and includes their testimonials. This letter invites 50 + other neighbors to come in and accept a complimentary adjustment "on behalf" of the four or five original neighbors so they can experience what made their neighbors/friends so happy with the services they received.

How do you think those 50 neighbors would react, especially if some of them had been considering the use of a Chiropractor (most Americans have lower back pain) or perhaps they're not happy with their current Chiropractor? This is a powerful tool because the endorsement comes from their "circle of influence" coupled with the generous offer. Can you see the major impact of this approach when compared with receiving a generic promotional mailing, reading a standard Yellow Pages ad, a print ad, or hearing a generic radio spot?

Additionally, consider the investment per targeted client in this "circle of influence group." Generally, it would fall in the $50 range and that is incredibly inexpensive if you compare it to the kind of advertising most businesses use.

ARE YOU RECOGNIZING THE POWER OF A DYNAMIC REFERRAL SYSTEM?

Since most of the basic elements of an average referral marketing system are so similar, let's begin by discussing the two different referral systems in detail… then you can move forward in developing and recognizing the variations that suit your own specific business model.

THE "STATIC" REFERRAL SYSTEM

Every business can thrive by creating ways to get referrals. Referrals come from happy, satisfied clients who let others know about your service or products. And when the system is working well, those satisfied clients tell others about your business. This typically happens by sheer luck if you don't have a systematic process in place. Your referrals will simply dribble in hit and miss. Even a static referral system is better than none. Otherwise, you'd be missing out on many new customers and the additional cash flow they produce.

That "static" referral model calls for you and your employees to consistently ask for the names of all your client's friends, family, business associates, and others who may need what you're offering. Naturally, this can be done face-to-face, by email, or by letter.

?????? ?????? ???? ?????? ????????????-????. The "static" model is only successful if your employees continually follow through and never miss an opportunity to ask for referrals. The negative side of this referral program is the prospect felt the introduction was a bit impersonal. An example would be if I received a telephone call from a realtor I didn't know telling me a friend of mine gave them my name and number. Since my information was given out without my permission I could be put off by that approach and my first inclination would be to get off the phone as quickly as possible.

"Super-charging" a Static Referral System?is simple if you can get your clients to either personally contact 3 to 4 potential prospects and tell them about you and your business… how much they like you and the excellent service they can expect to receive from you. Do you see the difference between this and you or one of your employees picking up the phone and basically cold calling prospects using just a name and phone number?

The perfect scenario is for you to call them after your satisfied client has already opened the door for you to invite them in for complementary treatment, a free meal, or a free product sample. That person is now primed to hear from you and calling to offer them a "gift" now becomes your preferred sales process. Your client has pre-screened and qualified them for you. What could be better?

Approach your regular clients and get them to agree to assist you by providing you with 3 to 4 names and numbers after they talk to them is a win-win scenario for everyone. Your regular client will be rewarded, your new prospect will receive a "freebie" and your client base will rapidly grow by the week.

Even better, what if you could get your regular clients to call you as soon as they talk to a new prospect and let you know they're open to speaking with you? Make sure you call them immediately and invite them to come to your office or place of business for their complimentary "gift." This is a very effective and powerful method even though it will take a bit of finesse to make sure your regular client is up to taking action and making those contacts.

On the other hand, they're going to be rewarded for the few minutes it will take them to place a few calls or have a short conversation with a co-worker, friend or family member. Be sure you provide them with your business cards. Anyone carrying around business cards from someone whose business they frequent shows they're truly excited and happy about doing business with you, and the person receiving it will feel their commitment to sharing information about your business.

HERE IS AN OVERVIEW OF A STATIC REFERRAL SYSTEM

1. Ask for referrals from satisfied and happy customers on a consistent basis.
2. Let your customers know about the rewards for your "new" referral system.
3. Make sure your reward system is in place and make it as generous as you can, whether with cash or free services.
4. Create a compelling referral incentive that excites the prospect enough to give your business a try.
5. Follow up immediately with every new referral consistently and systematically.

???????? ???????????????????? ?????????? ?? ???????????????? ???????????? ?????? ???????? ?????????????????? ???????? ?????????????????? ????. This is typically the fault of the business owner. They become lax and fail to make sure their employees are using the system and following each and every step. Employees have a tendency to look for shortcuts, and that often has a negative impact on the bottom line.

Always remain vigilant and perform all the steps we're discussing on a daily basis. That small amount of effort done systematically and continually will have a major impact on your cash flow. When you allow those taking part in the system to become lax in their efforts, you will lose valuable referrals, and each lost referral is lost revenue.

The processes for creating a consistent flow of high-quality referrals from your current client base are as follows:

1. Use uniform methods for gleaning referrals
2. Proper timing is key to producing referrals

THE BEST APPROACH FOR PRODUCING REFERRALS

Compelling your clients to actively provide you with unlimited and quality referrals is the only way to build a successful referral system. Failing to get referrals is bad for any business, yet receiving a flood of the wrong kind of referrals can be devastating. Unqualified prospects will waste your time, effort, energy, and money.

The "art" is in asking for referrals. Believe it or not, you can "train" your clients to ask for referrals. Your approach needs to be more focused on helping them understand the right way to ask for a referral and the perfect prospect to approach. You want to access the right "levers" that will automatically cause your referring client to know exactly who the right prospect is.

FIVE "LEVERS" THAT CAN BE "PULLED" TO START THE FLOW OF QUALITY REFERRALS

Lever # 1- The "Leading question" to ask your clients

With laser-like precision, you can help identify the perfect prospect you're seeking. You may ask; "Do you know someone with lower back pain?" Or, "Who do you know who loves Italian food?"

Engage your client in a discussion and remind them of what you've done for them and share specific examples of how you've helped others. Telling a story is the most powerful tool in your arsenal. It will pull a lever on their memory that makes them think of and say something like; "Hey, I do know someone who could use your help." People love to help others and it makes them feel good when they do. You can also ask if they know someone with a certain health challenge or someone who needs your services.

Asking your customer how satisfied they are with your service is another approach to consider. Just ask! If their response is positive then ask them if they can think of anyone else with a similar desire, challenge or problem like theirs. It's also a great idea to get them thinking about specific locations. By asking them if they know of someone at their church, office, or neighborhood, these specific locations often trigger them into remembering specific individuals that need what you sell.

Lever # 2- The referral sheet or "brain tickler" form

If you're looking for particular businesses to target, list them on your referral sheet with spaces for names, phone numbers, contacts, and addresses.

To simplify, let's say you're targeting bookkeepers who work for those in your industry. Add "bookkeepers" to the list and this will "tickle" the brain of your client to hone in on certain people they know in that field.

If you want to get down to a particular demographic profile, then write a specific description on your sheet. For a daycare, put down "families I know with children under four who live in my neighborhood."

Lever # 3- Get the Rolodex

This requires a direct approach, but ask your clients to access their Rolodex or address book to find 5 to 10 names that suit your demographic profile. It takes some education on your part to make sure they understand exactly whom you're looking for in a quality referral.

Lever # 4- Get to know whom your clients know

Your client may be new in town and therefore hasn't had time to get to know many people. However, they may know a person in the perfect industry who in turn knows a lot of quality people who could use your service or product. That can double your referral team.

Lever # 5- Sending a self-mailer on a periodic basis

Use the mail to send a postcard to your clients asking them to write down 3 to 4 referrals. This can be a self-mailer with pre-paid postage. This can generate fresh new prospects while reminding your current clients that it may be time for them to come to see you.

You can also use a variety of methods. My Chiropractor can use a mailing piece to offer a coupon for a discount and to entice the client to send referrals. A "brain tickler" can also be included with information on the rewards they receive when participating in the referral program.

HOW TO "TIME" THE REFERRAL REQUEST

Many people cringe when they consider asking for referrals. There is often a fear of rejection, even from regular customers. Fear is something that must be overcome and dismissed if your business is going to thrive.

Just ask! If you have regular customers they obviously like you and your business and will more than likely be happy to help you grow your business. Planting "seeds" on a consistent basis will grow your garden of referrals and you will end up with a bountiful crop.

Educating your clients on the benefits they and those they refer will receive is a very strong tactic. Naturally, you don't have to ask them for referrals every time they come into your business, yet you can visit with them, tell them a story of one of their referrals who came to you, and thank them for taking the time to share your information.

This is also the perfect time to give them a thank-you gift, perhaps a free session, lunch on you, or whatever freebie is appropriate.

FIVE MAJOR OPPORTUNITIES TO "ASK" FOR REFERRALS

When they buy something

How often have you felt excited and happy about the service or products you received from a business and offered to write a referral letter or give a testimonial, yet never got around to it? No matter what marketing system you use, approaching each client at their highest state of satisfaction is the moment they will comply and give you whatever you ask for.

As an example, if your housekeeper makes your home shine, look great and smell wonderful, you would most certainly be at your highest state of satisfaction. This is the best time for the housekeeper to ask for and get referrals from you.

If the housekeeper just leaves and doesn't ask, you typically go on with your daily routine and don't think about her again until she comes back the next time. As time goes by, your enthusiasm wanes and the "glow" you initially felt is long forgotten. If you don't see her for a while (perhaps you go on vacation) you won't be nearly as likely to give her a referral if she suddenly calls and asks.

Let's say you bought a microwave, the salesman was very helpful and attentive and gave you all the time you needed to choose the right appliance. You brought it home, plugged it in and everything was fine. You received excellent service and got exactly what you wanted. But the salesman never asked for any referrals.

A few months down the road you put your food in the microwave, turn it on and it suddenly starts sparking and burns out. You call the store and the same salesman says he's sorry but you'll have to call the manufacturer. He couldn't help you and now it's going to be hours on the phone trying to get a new microwave. Are you feeling less satisfied with the salesman and the company? Of course, you are. Would you give them any referrals? The answer is probably not.

How about this scenario? You visit a massage therapist. The massage was amazing, you feel great and she offers you a four massage package for the price of three. For 3 to 4 referrals she'll give you a discount on another massage. You just enjoyed an hour of complete bliss and know all your friends and associates would love to feel the same way. She has just hit your "hot button" so you gladly give her the referrals. You win, she wins and everyone you've recommended to her wins as well.

When she asked for the referrals she hit your "hot button" by asking; "Whom do you know who could use a relaxing massage to relieve stress?" Most people would admit that practically everyone they know is stressed out, so that's an easy one.

When you've had a client who has used your services or bought from you numerous times.

If you become too aggressive and "pounce" on your client too quickly they may feel pressured. Waiting until they have been to your place of business on several occasions gives you time to build a personal relationship and gain their trust. You'll feel when the moment is right to ask. Then feel free to ask at the point of purchase. By then you can "move" them in the direction you want them to go without pressuring them to give you the names of their friends and associates.

Asking within a few days of last seeing them

If you feel shy or hesitant about asking for referrals at the point of sale… or you feel the timing isn't right… or you just need more time to work up your courage, then consider mailing them a thank you letter or postcard within a few days of the transaction.

Your clients or customers don't carry around the contact information of everyone they know, and they certainly can't remember everyone's addresses and phone numbers. That's when a casual reminder asking for referrals that fit a specific category can deliver referrals you would have otherwise failed to receive. If you don't take action and ask, who will? Your employees do what you request of them… and as we all know, most "workers" really don't take on extra tasks unless you make it a part of their job. It's up to you to make this critical component a part of their everyday responsibilities.

Delay asking until you receive praise or a "thank you" from your client

Many people can be shy or feel awkward using the approaches we've discussed so far. People don't want to feel as though they're being too forward or pushy. But in reality, you're doing your customers a favor. When your clients are praising your services or products they're in their "Peak Satisfaction" state.

Periodically in person or by mail

By asking for referrals every few months you won't wear out your welcome or make your clients feel pressured. Of course, you can use trial and error to see how they respond, and how often is too often to ask and monitor your results so you can perfect your timing. Never allow yourself to believe they just don't know anyone.

Everyone knows at least 10 to 20 people and many often know hundreds. But if they know 10, then those 10 also know 10… and so on. Do the math. In a very short time, you could have hundreds of new prospects. And as happy and motivated customers they should be more than happy to refer you to others, especially when they receive something for their efforts.

Now that you've created your own "Static" referral system, you can take a step up by implementing the second tier of a phenomenal referral system.

Our weekly training videos?are content-rich, straight-to-the-point instructional presentations that will enable you to generate more leads, attract more clients, and make more money.

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