There are many ways to seek out business referrals and generate new business, but one of the most effective is also one of the most underused: ask your current customers. Referrals are one of the best tools for generating quality leads. For example, referral marketing platform Referral Candy has seen success rates soar to 7.5%. This means that more than 7 out of 100 sales result from a referral. Adjust how you allocate your sales and marketing time, and you could see an even higher number of sales generated by referrals. So why are referrals such an effective sales tactic? On the one hand, it’s up to your current customers to do the hard work for you. china phone numbers You also get “social proof”. Leads generated through referrals are more likely to convert, simply because they trust the source of the introduction.
Additionally, referred customers typically stay longer and spend more than customers acquired through other means. A study found that “referred customers spend 10-25% more on their initial purchase and make significantly more repeat purchases.” The average lifespan of a referred customer is also approximately 16% longer than that of customers acquired through other channels. If you want your organization to invest in referrals, you need to develop a defined process. Asking for, tracking and converting referrals should become an innate part of your sales process. However, as Black suggests, don’t assume salespeople will naturally think of asking for referrals. It’s a different skill set that people aren’t naturally comfortable with, even your most skilled and experienced salespeople.
Devise a strategy
For many sellers, asking for and converting referrals is a whole new skill. Learning this skill takes training and practice. Implement a training program designed to teach your salespeople (or yourself) the proper way to ask for referrals, and the proper way to nurture and convert the ones they get. Setting up a recommendation request process that brings concrete results takes time and patience. Even naturally skilled salespeople need constant training to hone their skills. Multi-day training days can be effective in some settings, but too much time off the sales floor can be expensive. Instead, focus on micro-learning opportunities in team meetings, focus groups, or one-on-one interviews where they can review referral request best practices and try them out with a colleague or manager. Leverage call recording software and spend time reviewing past calls from successful referral requests to share the success with the team