Using Customer Referrals To Maximize ROI In A Down Economy.
I read a great article today on the Manage Smarter Web site. The article’s focus was one of the primary things we talk to clients about all the time … tap into the power of your satisfied customers to increase sales without increasing your marketing costs.
I’m talking about referrals.
I agree with the article’s author, Joanne Black. Here’s her position on referrals: “When a qualified prospect is referred to you, you get a new client typically 70-90% of the time.”
She offered eight tips for building business in a lagging economy:
1. Broaden Your Perspective.
What business are you in? Redefine and reinvent yourself. Determine how you can create a leap in demand for your products and services. Build new alliances and consider alternate distribution channels. Don’t go solo. It’s important to assemble a group of advisors and get their input and creative ideas, and include people who have differing points of view from you.
2. Be Nimble and Innovative.
You’ll never have all the facts. Go ahead; make quick decisions. Be fearless and make those tough choices. Create new uses for your products. Why not a new business model?
3. Dazzle Your Current Customers.
Your current customers need care and feeding. Don’t ignore them at the expense of new business because they are your best source for new business.
4. Prioritize Wisely.
The most important activity for any salesperson is to do what’s “closest to cash” the first thing every single day—whether it’s following up with a prospect, writing a proposal or closing a deal.
5. Become an Expert.
Companies hire experts because they can’t afford to make mistakes. Position your company as the expert with a specific product or in a specific market niche. Become an expert and people will be more likely to refer you.
6. Stay Connected.
If you want to get more referrals you have to network like crazy. Attend a minimum of one event a week. You never know who you will meet and what you will learn. Never let your network go down. Networking is an essential referral marketing activity. So go make connections and build your business. Talk to people and find out how you can help them. How is their business doing? Are they impacted by the lagging economy? How? Don’t e-mail—call. You make connections by talking to people and by spending the time having a robust conversation.
7. Don’t Cut Prices. Increase Value.
There’s a lot of chatter about cutting prices in a lagging economy. Many small business owners think businesses are cutting back, so prospects don’t have money for their projects. But, by cutting prices, you’re cutting your profits even further. Instead, consider how to “get in and get started.” Divide your offering into smaller chunks, get results and create traction. Or, give more value. When you offer high-value products and services, people will refer you and you will get more sales, even in a recession economy.
8. Commit to Building Your Referral Business.
Referrals are always terrific, but they mean even more in a lagging economy. Don’t let the lagging economy trickle down on you. Take charge and make your phone ring again! Let your prospects know how much you care about them. Tell and show just how much you appreciate their business. Inform them that you’d like to help people just like them. And, don’t forget to thank your prospects and clients for their referral.
What are you doing to increase your ROI and build sales during this historic period in our economy? I’m convinces that the big winners will those companies that see this is as an opportunity to build market share and emerge even stronger.
Think about the power of referrals and how you can implement the practice in your enterprise. Oh, and by the way, if you know anyone who could benefit from our thinking, feel free to refer them our way!
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