Sales and Sales Management Blog

June 11, 2011

Understand the Four Pillars of a Referral and You’ll Get More and Better Referrals

Filed under: business,lead generation,marketing,Personal Marketing,prospecting,Referral Selling,sales,selling,small business — Paul McCord @ 12:56 pm
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At first glance, a referral is a pretty simple thing.  For most salespeople, managers, and trainers, a referral is just a name and phone number that a client has given the salesperson once the salesperson has completed the sale and has done a good job for the client.

Once a salesperson has received a referral, contacting the referred party is just as simple.  The salesperson either will call the referred party mentioning to him or her that the client, which they know, referred the salesperson to them, or will ask the client to write a referral letter to the prospect and then the salesperson will call the prospect after they have received the letter.  A very simple, straightforward process.

Unfortunately, this process is totally and completely wrong, and has been proven by millions of salespeople to not work worth a darn. Nevertheless, this is what is taught in almost every sales course in the world.  And not only is it a waste of time and effort, it deceives the salespeople who don’t succeed with it into believing that the fault lies with them, not with a “system” that doesn’t work.

Generating a large number of high quality referrals requires far more than “doing a good job and asking for referrals.”  It requires a systematic process of planting referral seeds, watering them at every chance, weeding out problems and issues, and then reaping the rewards. 

If you want to generate a large number of high quality referrals from your clients, you must understand what a referral is based on.

A Referral is Based on a Foundation with Four Pillars-and you can control 3 of them:

The relationship between you and your client:  you can control this pillar of the foundation.  By instituting the full client relationship building process in detailed in Creating a Million Dollar a Year Sales Income: Sales Success through Client Referrals (John Wiley and Sons, 2007), you can create a strong relationship with your client built on mutual trust.  Clients don’t give referrals because they like you or even because you did a good job.  Clients hate to give referrals and unless they have a deep trust that you will not embarrass them and that you’ll deal honestly with the prospect they refer, they won’t be willing to give quality referrals.

Your client’s purchasing experience: you can control this pillar of the foundation.  You must discover exactly what your client’s expectations and priorities are, then meet-, and hopefully exceed them.  You cannot afford to guess or “think” you know what these are-you must know exactly and you can only do that by discussing them with your client and then making sure you meet them or exceed them-nothing less will do.

The relationship between your client and the prospect: you have no control over this pillar.  Clients will refer you to people they have very strong, positive relationships with and people they have very negative relationships with.  If the prospect trusts and respects our client, some that trust and respect will be automatically imbued to you.  On the other hand, if the prospect distrusts or doesn’t respect your client, some of that distrust or disrespect will also be imbued to you.  Your job is to find out exactly what the relationship between client and prospect is and then plan you approach accordingly.

Your initial contact with the prospect: you control this pillar also.  If you have built your relationship with the client properly, your client will be happy to contact the prospect in whatever method you desire.  As outlined in Creating a Million Dollar a Year Sales Income, there are a number of methods of contacting clients, each with their own pros and cons, depending on the strength or weakness of the client/prospect relationship.

As seen above, you have control of the majority of the pillars upon which a referral is based.  If any of the above is weak, your likelihood of generating quality referrals will decline and the weakness must be made up elsewhere.  In actuality, if one of the first two segments is weak, you will not be getting quality referrals-period.  However, you can mitigate the affects of the last two.

If the relationship between client and prospect is weak, use a stronger contact method.  Moreover, if the contact method is weak, convert the method into a stronger one.  For example, if your contact method is a phone call to a prospect who has a weak relationship with your client, try to bring in one or two other clients the prospect may know by reputation to build additional credibility.  Better yet, try to arrange a conference call between the prospect and your client.

Generating a large number of quality sales isn’t done by chance or luck, and neither is generating a large number of high quality referrals. Just as you need a well thought out process to consistently sell, you need a well thought out process to generate quality referrals.   You can significantly increase the volume and the success of your referrals if you understand the dynamics that generate quality referrals and then control those dynamics.

March 15, 2011

Five Keys to Generating High Quality Referrals

Filed under: lead generation,prospecting,Referral Selling,sales,selling,small business — Paul McCord @ 9:52 am
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From the time we enter the sales industry we’ve heard that referrals are by far the best prospecting and marketing method in existence.  Yet, very few of us actually get very many high quality referrals. 

Certainly some of us manage to get a name and phone number here and another there.  A few of us will manage to get several.  However, most of these “referrals” are worthless–just names and phone numbers of people or businesses that have no interest in or need for or can’t afford our product or service.

Nevertheless, there are a few salespeople and business owners who have found a way to not only generate more than just a few referrals, but somehow they manage to generate enough high quality referrals to run very successful sales practices almost exclusively from the referrals they receive from their clients. 

Do they have some great secret the rest of us don’t know?

In a sense, they do know something most of us don’t.  They’ve learned that what most of us are doing to get referrals—just asking a question such as, “Ms. Client, do you know of anyone else that I might help”–doesn’t work.   

Moreover, they have learned ways that do work. 

Let’s look at five of the most basic things these mega-referral producers have learned:

1.  Ask for referrals:  Sounds stupid right?  If you don’t ask, how do you expect to get them?  Unfortunately, over 50% of salespeople simply never ask—and the majorities who do ‘ask,’ really don’t ask for referrals. 

2.  Really Ask:  Asking means a direct request for referrals.  Studies have also shown that the majority of salespeople and business owners who ask for referrals don’t really ask–they suggest.  They’ll say something like “Don, if you happen to run across someone who could use my service, would you give them one of my cards?” and then they hand the client a bunch of cards—that usually go straight into the trash.

3.  Let the client know who’s a good referral:  Very few salespeople ever define for the client exactly who a good referral is.  They assume the client knows.  Bad assumption.  Clients aren’t in your business.  Why should they know?  You have to let them know exactly who you’re looking for.

4   Better yet, make the referral easy for them:  Instead of making your client come up with the referral, do the work for them.  During the course of the sale do some detective work and figure out who your client knows that you know you want to be referred to.  Then, when it comes time to ask for referrals, make it easy for them.  Say something such as, “Ms. Client, I’ve been trying to connect with Joe Blow at XYZ Company for quite some time and just haven’t been able to make the connection.  It dawned on me that you might know Joe.  Do you know him?” 

If I’ve done my homework well, I know—or at least have good reason to believe—the answer will be yes.

If I know my client trusts me and that I’ve done a good job for her, I then suggest the referral:  “Great.  Would you be comfortable introducing me to him?”

My client doesn’t have to wonder who might make a good referral for me.  She doesn’t have to think.  She doesn’t have to do anything other than to utter one simple word, “yes.”  It’s a lot easier for a client to say “yes” than it is to figure out who would be a good referral.  It takes no time.  It takes no effort.  It’s easy.  I get a referral to someone that I know I want to be referred to.

5  Don’t get names and phone numbers, get introduced.  A name and phone number is just a nme and phone number, not a referral.  Get introduced to the prospect through an introduction letter, phone call, or lunch meeting.

Mega-referral producers have a detailed process they use to generate a large number of high quality referrals from every one of their clients–and even prospects.  They have developed a disciplined and effective procedure they use with each client that leads to a predictable end—receiving a large number of high quality referrals. 

But even without learning the process they use, if you simply implement these 7 simple tips, you’ll increase both the number and quality of the referrals you receive from your clients immediately. 

Want to learn the high referral generation process they use?  Contact me at pmccord@mccordandassociates.com or give me a call at 281-216-6845.

December 27, 2010

Is Confusing Word of Mouth Marketing with Referral Marketing Costing You Business?

Filed under: marketing,prospecting,Referral Selling,small business,Word of Mouth Marketing — Paul McCord @ 12:30 pm
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Log on to almost any site that has a large and varied library of sales articles or head over to Amazon and scan the books that come up from a keyword search of “referrals” and you’ll find one of the most common—and innocently destructive—confusions in the discussion of prospecting methodologies: discussing word of mouth marketing in the same context as referral marketing.

From sellers to business owners to sales leaders to some of the biggest names in sales training and coaching, word of mouth marketing and referral selling are discussed as though that are just two aspects of the same prospecting methodology.  They aren’t.  They are very, very different, and understanding the difference is important if you want to maximize your word of mouth and/or referral marketing effectiveness.

Word of Mouth Marketing is PASSIVE.  In word of mouth marketing the object is to have someone, usually a client, recommend people they know call you if they have a need for your product or service.  Your recommender may or may not give the person they speak to one of your cards or your phone number, but at a minimum they will tell the other person your name and give them a brief idea of why they should speak with you—usually an idea of what you accomplished for them, how great your service was, or how competitive your price.

Other than possibly encouraging them to pass along your information—and maybe giving them a few of your business cards—you have no control.  You are relying on other people to create business for you.  You have to rely on your client to mention you to those they speak to who might need your products or service.  You then have to hope that the person they spoke to about you picks up the phone and gives you a call or to walks into your office.  Seldom do you even know that your client spoke to someone about you.

Word of mouth marketing works.  It certainly isn’t the most effective prospecting strategy, but it has its place in the prospecting toolkit of many sellers.

Referral Marketing is PROACTIVE.  Referral marketing is the exact opposite of word of mouth marketing.  Instead of waiting for someone else to generate prospects for you, referral marketing demands that you take control of the process, including doing the referral work for your client.

Traditionally referral marketing has been taught as a semi-proactive process; one where you were taught to ask a weak referral question such as, “Ms. Client, do you know anyone else that I might help?”  Or, “Mr. Client, who do you know that might benefit from my products or services?”

When you ask a weak referral question such as one of these, you’re still relying on your client to do your prospecting for you.  Although more proactive than word of mouth marketing, you still have little control over the result—you may or may not get a positive response to your question, and even when you get a positive response, it may not be a referral to a quality prospect.

However, if you’ll do the work for your client by doing some detective work to figure out who your client knows that you know you want to be referred to, and then instead of asking a general referral question, asking for the specific introduction to the person you know you want to be referred to that you know your client knows, you’ve taken total control of the referral process.  You’re no longer relying on your client to come up with a quality referral for you, nor are you relying on them maybe mentioning you to someone who might need your products or services.  Instead, you’re asking for a direct introduction to someone you KNOW you want to be referred to.  You know you’re getting a high quality referral.

It isn’t a possible.  It isn’t a maybe.  It isn’t a might. 

It isn’t a maybe they’ll take my phone call.  It isn’t a maybe I’ll get to talk to them.

It is a direct introduction to someone you know you want to be referred to.  You know it is a good referral.  You know it is a quality prospect.  You know you’ll get to talk to them. 

You’ve taken all the maybe’s out of the equation and have taken total control of the process.

Referral marketing is not only far more effective than word of mouth marketing, it is also a far more predictable prospect generation strategy.

OK, so there’s a difference.  What’s the big deal?

It’s a big deal to understand the difference because it means you can substantially increase your business by thoroughly understanding how each strategy works and then employing both in your sales business.

I’ve had a great many sellers and sales leaders tell me that they either currently use referral marketing aggressively or they tried referral marketing and it was a total flop.  Yet when I question them about what they’re doing or what they did that didn’t work I discover that they were using word of mouth marketing, not referral marketing. 

Lumping word of mouth marketing in with referral marketing is an innocent mistake–but one that is costing sellers business.  And although they are very different strategies, by engaging your clients and others in both a proactive and a passive prospect generation strategy, you can quickly and substantially increase your pipeline.  It simply takes understanding the difference between the two strategies than then learning how to maximize their utilization.

December 3, 2010

Can You Build Your Business From Referrals? Depends on the Question You Ask

Filed under: marketing,prospecting,Referral Selling,sales,selling,small business — Paul McCord @ 11:03 am
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Over the past few years I’ve worked with thousands of sellers, helping them learn how to radically increase both the quantity and quality of referrals they get from their clients.  In the early stages of working with these men and women I usually hear the same comments and frustrations about referrals: from how asking for referrals is a waste of time because seldom do the referred prospects buy, to how asking for referrals makes the seller look weak, to how clients resent being asked for referrals.

There are dozens of reasons sellers have had less than great experience with referrals, and almost all of them are because the way they’ve been taught to seek referrals creates more problems than it solves. 

Most sellers have been taught that all you have to do to get referrals is ask for them after the sale has been completed.  Just do a good job for your client and then, after the sale, ask them if they know of anyone who could benefit from your products or services.  Depending upon the seller you ask, that simple referral question can take many different forms, such as:

“Ms. Client, who do you know that could use my products or services?”

“Mr. Client, who do you know that I should be talking to?”

“Mr. Client, who else do you know that I could help?”

“Ms. Client, if you happen to run across anyone else that I might be able to help, would you give them one of my cards?”

No matter how they phrase the request, seldom will these questions produce quality referrals because they don’t address the basic anxiety that many clients have about giving referrals, and worse, the seller is asking their client to do their prospecting for them, an unrealistic request and one that puts the client in an awkward position.

By waiting until the end of the sale to introduce the idea of referrals, sellers are making it very difficult to acquire quality referrals.  Most clients need time to get comfortable with the idea of giving referrals and they certainly need time to think about whom to refer.  Furthermore, they need a clear idea of who would make a great referred prospect.  And since most clients do things for the same reason most people do things, because they see doing the thing to be in their own best interests to do, the seller needs to give the client a good reason to give referrals.

All of the issues above work to make getting quality referrals difficult.  But in the end, the single biggest reason sellers don’t get many high quality referrals from their clients is because the client simply doesn’t know who to refer.  We think it is obvious whom to refer—we want them to refer someone just like themselves.  It isn’t obvious to them.  Although we may think they do, our clients don’t really understand all of the things we can do or all of the needs and issues we can solve.  Consequently, they really don’t know who to refer. 

So if asking your client for a referral to someone they know who might need your products or services doesn’t work very well, is it possible to get a large number of high quality referrals from clients?

Yes, absolutely it is.

But instead of asking a silly, weak question like “who do you know that might be able to use my products or services,” ask to be referred to a specific person.  Although the typical referral question is simple, it is very ineffective. 

More difficult and extremely effective is doing a bit of detective work to discover who your client knows that you know you want to be referred to and then asking for a direct introduction to that person.

 This method demands more from you than popping off a throwaway question at the end of the sale, but it is powerful because:

  • You are no longer asking your client to do your prospecting for you, taking an unwanted burden off them because you’re doing the work for them
  • You are far more likely to get a positive response from your client because instead of asking them to rummage around their mental file cabinet trying to figure out who to refer, you’re asking for a specific and easy to fulfill action—an introduction to someone they know
  • The introduction you get will be to a quality prospect because it will be to a prospect that you pick and that you know you want to be introduced to
  • You will have a much greater chance of setting an appointment with the prospect by being personally introduced by your client than if you just get their name and phone number and call them out of the blue
  • Over time, you can get multiple high quality introductions from each client.  They become a never ending source of quality referrals by simply asking for additional specific introductions as you earn them

Top sellers have learned how to build their businesses from referrals, and for most of them, that weak referral question most sellers ask isn’t a part of their referral strategy.  They’ve learned that if they make giving referrals easy for their clients, getting referrals becomes easy.  Better yet, they’ve learned that if they control the referral process and get referred to the prospects they want to be referred to, their closing ratio from referrals doubles, triples, quadruples, or more.

Referrals can be the cornerstone of your sales business if you learn to do a little detective work and make it easy for your clients to give the great referrals you’ve always wanted.

November 6, 2010

How to Guarantee You Get Great Referrals

Filed under: marketing,prospecting,Referral Selling,selling,small business — Paul McCord @ 4:01 pm
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At first glance, a referral is a pretty simple thing.  For most sellers, managers, and trainers, a referral is just a name and phone number that a client has given once the seller has completed the sale, has done a good job for the client, and then asks a general question such as, “do you know of anyone else that I might be able to help?,” or, “do you know of anyone else that might benefit from my products and services?”.

Once a seller has received a referral, contacting the referred party is just as simple.  The seller will call the referred party mentioning to him or her that the client, which the prospect knows, referred the seller to them, or on occasion they will ask the client to write a referral letter to the prospect and then the seller will call the prospect after they have received the letter.  A very simple, straightforward process.

Unfortunately, this “do a good job and ask for a referral” process is totally and completely wrong, and has been proven by millions of sellers to not work worth a darn. Nevertheless, this is what is taught in almost every sales course that mentions referrals.  And not only is it a waste of time and effort, it deceives the seller who don’t succeed when using it into believing that the fault lies with him or her, not with a “system” that doesn’t work.

Generating a large number of high quality referrals requires far more than “doing a good job and asking for a referral.” 

If you want to generate a large number of high quality referrals from your clients, you must understand what creates a quality referral.

A high quality referral is built on a foundation that has four solid pillars—and as the seller; you have control over three of them:

  1. Your relationship with your client:  Most clients don’t give referrals because they like you or even because you did a good job.  Certainly there are a few clients that will give referrals at the drop of a hat, but most clients hate to give referrals and unless they have a deep trust that you will not embarrass them and that you’ll deal honestly and competently with the prospect they refer, they won’t be willing to give quality referrals. 

    Most clients believe that when they give a referral they’re not just suggesting that someone they know speak to the person they are referring, they believe that they are endorsing the seller, in essence telling the person they refer to the seller that they don’t need to do any research because the referrer has already done it and this person they’re referring is the best choice.  To get clients to take this step doesn’t come without having built a strong bond of trust.

  2. Your client’s purchasing experience:  Discover what your client’s purchasing expectations and priorities are, then meet and, hopefully, exceed them. 

    Few sellers ever exceed their client’s expectations because even though they think they know what the client’s expectations are, they never really try to find out, they never ask.  You cannot afford to guess or “think” you know what your client’s expectations are–you must know exactly, and you can only do that by discussing them with your client and then making sure you meet or exceed them–nothing less will do. 

    If you don’t specifically ask your client what their expectations are, the best you can do is meet or exceed what you think your client’s expectations should be.

    Clients assume that the purchasing experience anyone they refer you  to will have a similar or WORSE experience than they had.  The further away from their desired purchasing experience they have, the less likely they will be to give a quality referral.

  3. The relationship between your client and the prospect:  This is the one pillar you have no control over.  Clients will refer you to people they have very strong, positive relationships with–and people they have very negative relationships with. 

    If the prospect trusts and respects your client, some of that trust and respect will be automatically imbued to you and you start your relationship with them from a position of strength.  On the other hand, if the prospect distrusts or doesn’t respect your client, some of that distrust or disrespect will also be imbued to you and you will start your relationship with them from a position of weakness.  Your job is to find out exactly what the relationship between client and prospect is and then plan you introduction approach to them accordingly.

  4. Your initial contact with the prospect:  To this point you’ve invested a great deal time and effort in establishing your relationship with your client, making sure they have exactly the purchasing experience they want, and finding out what the relationship is between your client and the prospect they are referring.  After investing so much time and attention to get this far, the last thing you want is just a name and phone number.

    Instead of getting a traditional “referral” consisting of the name and phone of the prospect and permission to use your client’s name, get a direct introduction from your client to the prospect. 

    There are three primary methods of getting a direct introduction:

    Letter of introduction from your client to the prospect:  Ask your client to write a letter introducing you to the prospect.  However, once you’ve asked your client to write the letter, let them know that you know how busy they are.  Offer to take the burden off of them by writing the letter for their signature.  If you allow them to write the letter it won’t communicate a reason for the prospect to meet with you and it will be written on their schedule—which could be never.

    The letter you write should give a brief overview of what you’ve done for your client and why the client believes it would be beneficial for the prospect to meet with you, as well as the time and date to expect a call from you.  Have your client sign it.  Phone the prospect at the exact time your client indicated you’d be calling.

    Introductory phone call from your client to the prospect:  An even stronger introduction is a phone call from your client to the prospect to introduce you.  This method puts additional pressure on the prospect to agree to set an appointment with you as it is difficult for the prospect to say “no” to your meeting request when they know that their friend, co-worker, or associate is standing next to you when you ask.

    The downside to a phone call is it gives the prospect the opportunity to ask questions of your client.  If there were aspects to the sale that didn’t go well there is a good chance they will surface during the phone call.

    Lunch meeting with your client, the prospect, and yourself:  A tremendously strong introduction method.  Have your client invite the prospect to lunch or coffee with the three of you.  Encourage your client to let the prospect know this is NOT a sales meeting, just an opportunity for the two of you to meet one another. 

    One of the strange things that often happens during the meeting is the client ends up being your salesperson and you are there simply as the consultant.  And, again, it is very difficult for the prospect to say “no” when you request a meeting.

As seen above, you have control of the majority of the pillars upon which a referral is based.  If any of the above is weak, your likelihood of generating quality referrals will decline and the weakness must be made up elsewhere.  In actuality, if one of the first two segments is weak, you will not be getting quality referrals–period.  However, you can mitigate the third one by using a strong method of introduction.

Generating a large number of quality sales isn’t done by chance or luck, and neither is generating a large number of high quality referrals. Just as you need a well thought out process to consistently sell, you need a well thought out process to generate quality referrals.   You can significantly increase the volume and the success of your referrals if you understand the dynamics that generate quality referrals and then control those dynamics.

September 1, 2010

Three Steps to Getting Hiqh Quality Referrals From Your Clients

Filed under: lead generation,marketing,prospecting,Referral Selling,sales,selling,small business — Paul McCord @ 1:58 pm
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Are you finding that you’re just not getting the number of quality referrals you want from your clients?  Chances are you said yes because that’s the case with most sellers.  Oh, sure, we all have some clients that will give us referrals all day long.  Just ask and they’ll give you name after name.  Other clients, the majority, aren’t nearly as generous with their referrals.

The biggest problem in both cases is so often the referral we get isn’t much better than pointing at a name in the phonebook at random.

How can you guarantee that you get great referrals?  Simple.  Make sure the client gives you a great referral by finding the referral for them to give you, rather than relying on them coming up with a quality referral to give.

The reality is that clients really don’t know who we’re looking for and most of them just don’t have a real incentive to invest the time and energy to come up with a great referral for us.

But we know who is a great referral for us.  And certainly we’re willing to invest the time and energy to find a great referral (if we’re not, we have some real serious issues to deal with).

Since we’re the one with the need; and we’re the one with the desire; and we’re the one who knows who makes a good referral for us, why would we rely on anyone else other than our self to come up with the referral?

So how can we come up with the referral for our client to give us?

Here are three steps to guaranteeing you get great referrals from your clients:

  1. 1.     Get Your Client On-board to Give Referrals.  Most sellers wait until after the sale has been completed before they bring up the idea of referrals.  Bad idea. 

    Most clients need time to get comfortable with the idea of giving referrals, so bring up referrals early in the relationship.  Don’t ask for referrals; just let your client know that your business is built on referrals and then drop referral seeds as the sale progresses.  Since your prospects and clients aren’t stupid, if they hear you mention referrals often in a casual manner, they’ll get the impression referrals are important to you and they will be expecting you to ask for them at some point.

  2. 2.    Find Out Who Your Client Knows.  We’ve already established that in order to get great referrals you have to do the work for your client, so do it by discovering during the course of the relationship who they know that you know you want to be referred to.

    How do you find out? Through small-talk (who do they mention in conversation they know); paying attention to what’s in their environment (pictures, association directories, membership plaques, and such); their background (where did they work previously); their work (what vendors and suppliers do they interact with).  Your job is to be a detective and to uncover the relationships they have with people or companies that you know you want to be referred to.  The more you uncover the more quality referrals you uncover.

  3. 3.    Don’t Ask for Referrals, Ask for THE Referral.  Now when it comes time to ask for referrals, you’re not going to be like every other seller and ask a weak question such as, “Donna, do you happen to know anyone else (or another company) that might be able to use my products or services (or that I can help—or any other such weak question)?”

    Instead you’re going to ask for a specific referral:  “Donna, I’ve been trying to connect with David Jones for some time without success.  You mentioned that you’ve worked with David for several years, would you be comfortable introducing me to him?”  You know she knows David.  You have reason to believe David is a good prospect for you.  Don’t waste Donna’s time with that weak general referral question; ask to get connected to a person you know she knows that you know you want to connect with.

Referrals can be the foundation of your sales business if you just develop the skills necessary to be a referral-based salesperson.  If Donna knows three people or companies you know you want to be referred to and you can get introductions to them from her, how much time and energy have you saved getting those three introductions through referrals instead of cold calling or sending out direct mail or hoping to bump into them at a networking event?

Forget what you’ve been taught about asking for referrals.  Referral generation is a PROACTIVE process where you do the work, not your client.  Your client doesn’t have the motivation, you do.  They don’t have the understanding of who makes a good referral like you do.  Your client doesn’t have the time to invest in figuring out a good referral like you do.  It’s your business, not theirs.  Make it easy to give quality referrals—you’ll get a ton of them if you do.

June 16, 2010

4 Referral “Laws” You Must Respect If You Want to Become Referral-Based

Filed under: marketing,prospecting,Referral Selling,sales,selling — Paul McCord @ 4:45 pm
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Over the years I’ve worked with thousands of sellers who have sought to move their sales business from a catch-as-catch-can prospecting business to a solidly referral-based business.  Most have been successful, but a few have refused to acknowledge and adhere to four basic “laws” that are critical for becoming referral-based.

  1.  Your Client Does Not Owe You Referrals.  So often I hear trainers and managers tell sellers to expect referrals because clients owe them for doing a good job.

     Bull.

    Your clients paid for the products or services you rendered.  They owe you NOTHING.

    That doesn’t mean you can’t get lots of great referrals.  You can.  But instead of expecting them because they are owed you, let your client know that your business is based on referrals and that you want to earn their referrals.  Then ask them what they expect to happen during the course of the sale.  Once you know what they expect, ask them that if you deliver on their expectations would you have earned their referrals.  If your client knows you want referrals and you make it clear how you will earn them, the majority of your clients will agree to give them once earned.

  2. If You Want Great Referrals, You Will Have to Uncover Them for Your Client.  Most clients really have no idea who to refer to you even after you’ve defined for them who your ideal client is.  They’re not in your business.  They don’t know all of the things you can do for a client.  It isn’t their job to know who to refer to you—it’s your job to help them make great referrals.

    Instead of waiting and hoping your client comes up with a quality referral or two at the end of the sale, take the time during the sales process to find out who your client knows that you know you want to be referred to and then, instead of asking a lame question like, “Mr. Client, do you know of anyone else that might be able to benefit from my products or services?,” ask for a referral to the specific person or company that you’ve discovered your client knows that you know you want to be referred to.

    Yes, this is much harder than just asking the general referral question, but it is many times more effective.  It takes detective work.  It takes time to learn to be constantly on the lookout for who your client knows.  It takes learning how to listen, to ask questions, to observe, to make all of your senses aware of what’s going on.  But the payoff is a strong, referral-based business.

  3. A Name and Phone Number of a Prospect is Not a Referral.  So, you worked with your client and got the name and phone number of a potential prospect from them.  Do you have a referral?  No, you have a name and phone number of a potential prospect.

    A referral is NOT simply a name and phone number.  Just getting a name and phone number is little better than making a cold call to the person.  Instead of a name and phone number, you want a personal introduction to the prospect from your client.

    Again, this is more difficult than just getting a name and number and picking up the phone to call them.  A personal introduction can be through a letter of introduction from your client (that you write for the client’s signature), a phone call from your client to the prospect introducing you, or a lunch or coffee meeting with your client and the prospect.  However you manage it, it must be a direct introduction from your client to prospect.

  4. Referrals Are Not Always Good.  Not all referrals are of the same value.  Certainly you know that.  But do you know that some referrals can actually harm your prospects of working with a prospect?

    How so, you ask?

    We all have clients who have referred us to people who trust and respect the client.  When we meet these referred prospects we are working from a position of strength because some of the trust and respect they have for our client is imbued to us simply by being referred by someone they trust and respect.

    But the opposite is also true.  Sometimes clients refer us to people who distrust and disrespect our client.  In those cases we are working from a position of weakness when we meet these prospects because some of the distrust and disrespect they have for our client is imbued to us also.  The more they distrust and disrespect our client, the weaker the position from which we start—sometimes to the point that we are better off not having the client introduce us.

    What is your client’s relationship to the referred prospect?  Don’t know?  Better find out before you ask to be introduced or you just might be surprised with the situation you find yourself in.

You can become a referral-based seller if you learn the laws of referral generation.  It takes a lot more than asking some weak “referral” question.  It means really getting to know your client.  It means really earning the referrals.  It means involving your client in the process while making giving great referrals easy for them.

Pay attention to these laws and you’ll find it a lot easier and more fun to get great referrals—and that’s a whole lot easier than pounding the phone cold calling.

February 5, 2010

A Couple of Blog Milestones and Some Other Stuff

Filed under: Networking,Referral Selling,sales,selling — Paul McCord @ 9:21 am
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A Positive Milestone: 1,000 comments
As every blogger knows, it’s tough to get people to interact with you on your blog.  I took me a couple of years to finally get to the point where comments became somewhat frequent.  I’m pleased to say that this morning the blog registered its 1,000th comment.  Not a giant milestone, but still, progress.

A Negative Milestone: 20,000 spam comments
Coincidentally, this morning the blog also blocked its 20,000th spam comment.  Spam, I’ve found, is the real cost of blogging.  Spam comes at you in all forms, whether bots with sex, casino, or watch spam or individuals trying to get mention of their blog posts about their get rich quick scheme or their lead generation ebook for only $79.99.

Anyway, as we continue in our fourth year of the Sales and Sales Management Blog, I’m honored that some have found it worthy of their time to read and even to comment on the content or link to the posts.

I’ll continue to try to bring quality posts that will help increase your sales, help you improve your sales team, and prompt you to think.  As always, I’ll be featuring many great authors besides myself. 

HELP!

My article “Sales Call Reports–Are They Worth the Hassle?” has made it to the finals for Sales Article of the Month for February at Top 10 Sales Articles.  I’ve got tough competition from Dr. Tony Alessandra, Keith Rosen, Lee Salz, Kevin Eikenberry, Danita Bye and others.  To win, I need your vote.  Half of the selection of the winner is based on reader votes; the other half based on votes by a panel of professional sales trainers and consultants.  I’d appreciate it if you’d hope over to Top 10 Sales Articles, read the 10 finalists and vote for the one you believe best (mine, of course).

Networking That Really Works: A FREE Prospecting Webinar on Feb 18

Are you spending time at the chamber networking event or the morning leads exchange group and finding you’re just wasting precious time and energy for no return at all?

Unless you’re an auto mechanic, a personal banker, sell cars, or are a dentist, the chamber event and the leads exchange group probably aren’t going to help you at all.  If you sell sophisticated products and services or high dollar items, more than likely you’re not going to be meeting great prospects or getting many quality leads at these venues.  The majority of people at the chamber event are other sellers looking for prospects and those at the networking breakfast typically can only refer to micro and small businesses or less than ideal consumer prospects.

So is networking out of the question?

Not at all.

You just have to network where you’re going to find a large number of quality prospects and create long-term relationships with them.

Join me on February 18 at 1PM Central for a FREE 1 hour webinar to learn how to make networking work.

You’ll Learn:

  • Where to spend your time networking
  • How networking demonstrates your integrity and trustworthiness
  • How networking builds your image and reputation as being an expert
  • How to work a room and guarantee after event meetings with prospects

This isn’t a come-on to sell products or coaching.  You’ll learn real strategies that produce results.

Limited Seating

Register HERE

Dave Brock reviews Creating a Million Dollar a Year Sales Income: Sales Success through Client Referrals

Over on his blog Dave Brock reviews my book on referral generation, Creating a Million Dollar a Year Sales Income: Sales Success through Client Referrals.  Dave makes some excellent observations and I encourage you to stop over and read the post—and while you’re there, read lots more posts as Dave is a very insightful writer and thinker.

January 23, 2010

Keep Your Client in the Loop After You Get the Referral

Filed under: Client Relationships,Communication,prospecting,Referral Selling,sales,selling — Paul McCord @ 10:55 am
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Congratulations, you’ve just received several referrals from one of your clients.  Great job!  But hold on, you’re work has just started.  No, I’m not talking about contacting and selling the referred prospect, I’m talking about keeping your client in the loop.

One of the primary reasons clients are hesitant to give referrals is that they are afraid of being embarrassed in front of a friend, relative, acquaintance or co-worker by you not performing as you should.  So, when they do give a referral, they have a vested interest in what’s going on between you and the prospect.  Not in the sense of whether or not the prospect purchases, but in how the prospect perceives you and the value being referred by the client.

When a client gives you a referral, you learn a number of things:

  1. The client will give referrals.  Obviously, you just received one or more.
  2. How well the client understands what you do.  The quality of the referral will let you know how well your client understands what you do and who is a good referral for you.  The better the referral, the more the client understands.  The poorer the referral, the more work you must do to educate them for future referrals (and future sales to them for that matter).
  3. How much they trust you.  Generally, the stronger the trust relationship between the client and the referred prospect, the more the client trusts you. 
  4. They have more referrals to give.  Seldom will a client give you all of the referrals they can make at one time.  If a client gives referrals, you can almost bet they have more to give—if you keep earning them.

How do you get those additional referrals?  Additional referrals are earned, just as the original referrals were earned.  You earn those additional referrals by:

  1. Giving your client the assurance that you’re trustworthy with referrals.  You must show through your actions that their trust in giving you a referral was well placed by making sure that the referred prospect has an exceptional experience with you.
  2. By keeping your client fully informed of everything that is occurring with the referred prospect.
  3. By continuing to deliver superior service to your client.

Does the above mean that you must perform perfectly with the referred prospect?  What if there was an honest mistake or miscommunication?  What if something out of your control happened during the course of the sale?  Will these incidents destroy any possibility of acquiring additional referrals?

No, not at all.

The keys to gaining additional referrals from a client are to treat the referred prospect exactly in the same manner you treated the client and to keep your client informed of what is transpiring between yourself and the referred prospect.

Your client gave you referrals because they understood that giving referrals was in their own best interests and because you earned them through the service, you gave them.  You must now demonstrate that same level of service for the referral they have given you.  They expect—actually demand—you perform at the same level—or higher—for those they refer to as you did for them.  That level of service you gave them was what demonstrated to them that they could trust with a referral.  Anything short of that and they will reevaluate whether you should be trusted with additional referrals.

That having been said, clients understand that mistakes, miscommunications, and problems arise in business.  A single issue during the course of the sale to a referred prospect, even a major issue, will not sever your ability to gain additional referrals from you client if you address and resolve the issue in an exceptional manner.

Clients don’t expect perfection, they expect exceptional service—both for themselves and for those they refer you to.  How well or poorly you handle the issues will be a major factor in determining your future refer-ability.

Keeping your client informed of the progress of the sale with the referred prospect reassures them that you’re doing your job—and that all is well.  It is also your source of informing them if there have been problems and how they were resolved. 

It is critical that you let your client know of issues involved with sales to prospects they have referred you to before the prospect has a chance to relate the incident.  You can relate the circumstances and the resolution in the most favorable light—the prospect may not.  This doesn’t mean that you can lie or gloss over it, just that you can give the background and the full resolution without the emotional involvement the prospect will have.  Of course, if you’ve done an exceptional job of resolving the issue, the tale told by the prospect should also be impressive.  However, you always want problems to be related to your client by you—you don’t want to get a phone call from the client asking what happened.

Keeping your client informed doesn’t mean bombarding them with emails, phone calls, and notes.  A simple “thank you for the referral” card immediately after receiving the referral and the occasional call or email will suffice.  The object is to keep them in the loop and to reassure them that their referral was well made for both you and the prospect.  Even better than the occasional call or email is to explicitly ask the client how and how often they would like to be informed of the progress.

Clients are interested in what’s going on with the referrals they make.  They want to know the prospect is being taken care of in the manner the client expected, and they enjoy knowing that they have provided you with a quality referral.  More importantly, they want to know that they haven’t embarrassed themselves in front of an acquaintance.

Simple actions will earn those additional referrals your clients have—you just have to earn them.

December 28, 2009

Free Webinar, Jan 21: 4 Quick Steps to Triple Your Client Referrals

Filed under: lead generation,Personal Marketing,prospecting,Referral Selling,sales,sales training,selling — Paul McCord @ 2:10 pm
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Free Webinar: 4 Quick Steps to Triple Your Client Referrals

Thursday, January 21  2PM Central Daylight Time

LIMITED SEATING so register early

Few sellers generate enough high quality referrals to seriously impact their sales and income because few have been taught how to work with their clients to generate high quality referrals. 

Most sellers have been “taught” that all you need to do is ask a satisfied client for referrals and they’ll give them.  Most find that asking doesn’t work.  Sure, there are a few clients who willing give “referrals,” but most won’t.  And even the “referrals” most sellers do get are nothing more than worthless names and phone numbers of people who have no interest in or need for their product or service.

Asking for referrals won’t get you where you want to go.

You must learn to work with your client to generate introductions to prospects who want and/or need your products and services.

That takes far more than asking some silly question such as “Ms. Client, do you know of anyone else that might be able to use my products or services?”

On January 21 we’ll focus on 4 easy to implement actions that will dramatically increase the number and quality of referrals you receive from each of your clients.

During this Hour You’ll Learn:

  • Why asking for referrals is a total waste of time
  • How to make your client comfortable and confident in giving high quality referrals
  • How to get your client to willing agree to give you multiple high quality referrals
  • How to get 3, 4, or more high quality referrals from your client—even if they say they have none to give you
  • How to nail down appoints with your referred prospects

The mega-producers don’t ask for referrals–but most have built their business on referrals.  Learn why you need to forget everything you’ve been taught about referrals—and learn how to generate them the same way the mega-producers do.

Start 2010 off right by learning how to fill your pipeline with great prospects.

LIMITED SEATING

Register HERE

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