6 Common Mistakes in Referral Marketing

Recently we discussed the importance of creating a referral strategy for your small business. Most marketing experts and small business owners alike agree that the single most cost effective and efficient way to grow any business is with referrals. If you missed that article, you can catch it right here.

This week I want to talk about what not to do when using referrals to grow your customer base. Referral marketing is by far the most profitable way to grow your client base, but it’s easy to do it the wrong way. Be sure to avoid these six most common mistakes:

1. Don’t expect referrals to materialize all on their own. Even if your client absolutely loves your services and thinks you are the best thing to come along since the invention of fried chicken, the growth of your business is not his priority. If you want referrals, not only do you have to earn them, but you also have to ask for them.
2. Don’t wait until the project or sale is over before asking for a referral. Your client is most enamored with you – and your services command the most top-of-mind awareness – while the project is still active. That’s the best time to ask for a referral.
3. Don’t be afraid to ask again. Studies show that those who ask twice receive 50% more referrals than those who only ask once. If your client hasn’t responded to your first referral request, don’t consider it a “brush off”. After all, he is just as busy as you are. It’s perfectly OK to remind him of your request.
4. Don’t be vague about what you’re looking for. Asking your client “Do you know anyone else who can use my services?” is just like saying “Think of every person you know…” Your client will be overwhelmed. The most successful referral requests are the most specific referral requests.
5. Don’t be afraid to follow up with the referred prospect. I’ve coached many small business owners on creating a referral strategy, and one of the biggest stumbling blocks I’ve seen is inconsistency in the follow up. Most of my clients “chicken out” when it comes to contacting the prospect. It’s important that you develop a strategy that you can use faithfully with each and every prospect, each and every time.
6. Don’t forget to follow up with the referral provider. Your clients are more likely to give repeat referrals when they know their referrals are appreciated and when they’re kept informed about the progress of their referrals. Again, develop a simple follow up strategy that you can use consistently.

Believe it or not, your clients really do want to give referrals. Most people enjoy helping and they like to feel important and needed. But you’ve got to make it effortless for your clients to give referrals. It’s important to develop an easy to use strategy that you can implement time and time again to put your referral program on autopilot.

I’ve recently compiled my own referral request strategy into an incredibly easy, complete system. You can actually generate your first referral request within 20 minutes! Check it out right here>>>

Action Item - Outline a strategy you can use to generate referrals on a consistent basis. Address the questions How will you ask, When will you ask and How will you follow up.

Now, go find some more clients!

Karen Scharf

You might also be interested in:

• How to Create an Abundant Flow of Perfect Customers
• Small Business Marketing and Getting Referrals – Mistakes to Avoid
• How To Turn Over 90% Of Referrals Into Customers
• Finding Your First Customers through Referral Partners
• Was Your Marketing Raised On Family Farms?

This entry was posted on Saturday, September 27th, 2008 at 12:47 pm and is filed under Small Business Marketing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.