How many referrals can you get?
Joe Girard – author of How to Sell Anything to Anybody and the Guinness Book of World Records’ world’s greatest salesman – says that every customer has the potential to refer 52 other customers.
Is your business averaging even half of that number… 26? Half of THAT… 13?
Probably not. Most contractors I talk to average less than one referral per customer.
No question… there’s room for improvement.
I recommend the EARS formula to my clients.
This formula will drive your referral numbers to new heights.
E stands for EARN – in other words, you have to earn your referrals. Walt Disney put it like this, “Do what you do so well that people can’t resist telling others about you.”
The key thing to remember is that “satisfied” customers don’t refer very often. If customers get only what they expected, that’s not good enough.
Delighted, enthusiastic, inspired, thrilled customers refer a LOT. You’ve got to deliver a customer experience and job quality far beyond what they expect from you.
A stands for ASK. If you’re asking for referrals only when you’re collecting your final payment, you won’t have much success.
You’ve got to let people know throughout your process – and on an ongoing basis – that your customers refer others and you expect referrals from them. You have to build it into your culture.
Here are some ideas to convey the message to them…
Run a referral promotion by giving customers certificates good for upgraded services or other services that they can put their name on and give to their neighbors and friends. Give a nice prize to those who generate the most referrals.
One of our clients – a remodeler in British Columbia – has an annual client appreciation event, and clients are encouraged to bring a friend, which many do. Great idea!
R stands for REWARD. When you get a referral, the smartest thing you can do is to make a really big deal out of it. A personal call and a hand-written thank you card are definitely called for, but I’d also send a meaningful gift.
My advice is to send a gift equal in value to the amount it costs you to attract a new prospect. And don’t even think about making it a coupon for a discount off of your services in the future. That’s just lame.
Not long ago I got a referral from one of my clients. I immediately arranged a dinner for four at a pricey steakhouse in their city.
S stands for STAY top of mind. If there is one “secret” to maximum referrals, it is a properly written paper-and-ink newsletter that you send every month.
Among other things, you can accomplish most of the items I mentioned here:
- Improve your customers’ experience with your company by sending fun and interesting content every month
- Make it clear that you expect referrals by mentioning clients who have referred to you, and describing the reward they receive
- Announce your referral event
- And so much more.
Truly, a client newsletter is the cornerstone of a system to create a steady source of great referrals to your business.
I encourage every one of my clients to use this proven, business-building strategy.
If you would like information about how to get a monthly newsletter going, email me at email@example.com with the subject line, “Client Newsletter.” I‘ll send you a sample of a client newsletter so that you can see exactly how to lay it out.