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Five Ways to Regain Your Referral Business
A consistent refrain we hear these days from companies that are struggling to emerge from recession mode: "We built this business on referrals. We'll rebuild it on referrals. It's just that . . . uh . . . the referrals have dried up."
What they're saying is there was a time when business was so good and opportunities so easy to find that they did not build any kind of strategy for new business development. It's not that your referral sources don't like you anymore, but some of them are suffering too, and they just don't know about or hear about deals like they used to. And in many industries, there just aren't as many deals as there used to be.
I'm all for referrals. If your current and past customers refer you to their friends and associates, it's a sign that they like and respect your work. It's also a sign that they know you well, they understand what you do, they believe your pricing is fair, and they know you won't make them look foolish if they pass along your name.
But waiting for referrals-hoping for referrals-expecting referrals-that's not a business development strategy. That's a death wish. Let's look at how you could re-design a sales process to incorporate referrals but not depend on having them show up just when you need them. It's all about a referral system, not just a referral network. [The Whale Hunters use the term "raven" to identify a referral source].
1. Do the work to identify specific characters of your best prospective customers.
a. Create your Target Filter and identify the specific characteristics of prospective customers that you are looking for. Make some tough choices about key factors like industry verticals, geography, company size, opportunity deal size, or growth path.
b. Research and identify prospects that meet those criteria. List companies by name that you would like to hunt.
c. Create lists of key contacts at your prospect companies. Gather contact information. Determine whether anyone inside your company knows a key contact. Use your social media tools.
2. Ask for specific referrals from specific clients and associates.
a. Share your key contact lists with ravens.
b. Ask ravens specifically who they know and how they are willing to help you connect.
c. Make a detailed referral request, i.e. "Will you make a phone call on our behalf?" or "Will you send an email introduction?" or "Will you arrange a coffee or lunch?"
3. Prepare for the referral.
a. Create a detailed dossier on the prospective customer and key contacts.
b. Know how that customer is connected to your raven and why the referral is being made. What does the raven think you can do for this prospect?
c. Help your raven know how to position you when they make the initial contact. Don't leave this to chance-be explicit and let the raven know how your programs or services may have changed over time.
4. Follow Up with the raven and the prospect.
a. Keep your raven informed of your progress; e.g. "I called Raul on Monday and left a VM." If you don't get a response, report this to your raven and discuss what to do next.
b. Don't drop the ball with your prospect. End each encounter with a clear next step, even if that step is to reconnect some months down the road.
c. Don't stop saying "thank you" to your raven and to your prospect, especially after your prospect becomes your customer. Work to serve each new customer with excellence so that your referral network will grow.
5. Create a formal referral process.
a. Invite key clients, associates, or past customers to serve on a board of advisors or user group for your company.
b. Develop meaningful agendas for the times when you convene them, giving them opportunities to network with each other as well as to advise you.
c. Take their advice seriously and act on it. Let them know what you've accomplished based on their recommendations. And keep saying thank you.
If your company had the good fortune to run on referrals alone for some time, now is your opportunity to build a new business development process that will better withstand the vagaries of the market. Use it to your advantage, and you can emerge from the recession stronger than ever.
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