growth strategy

Referrals - The 3 Step Plan Every Business Owner Needs to Know

Referral Engine Marketing Next to selling more to your current clients, referral marketing is the easiest sale of all. But most small business owners approach it as though it’s rain falling from the sky—they have no control over referrals, they just hope it comes when they need it.

Hope is not a strategy…

If you want more referrals, the good news is that they are just 3 simple steps away…

Step 1. Ask for referrals!

Ok, I know that seems a little simplistic (and it is…we’ll talk about how to ask in a moment) but seriously, if you want more referrals, ASK!

The trick is in knowing how to ask. For most of the business owners I work with there are four barriers to getting more referrals.

The Barriers to Getting Referrals

1. You’re uncomfortable asking for referrals (for some people it not discomfort…it’s downright fear). It’s OK. In fact it’s totally normal to be uncomfortable…even afraid to ask for referrals.

You don’t want to offend your client by begging for more business after you’ve already taken their money, right? I mean, really…it’s like saying you’re just not enough for me, I need more.

If you feel that way about asking for referrals you are far from alone. But your fears are unfounded. In his latest book Referral Engine, John Jantsch shares research that proves we humans are “wired to refer.”

If you think about it, sending someone you care about to a great resource makes YOU feel good and makes you valuable to the other person. It’s a win-win. So your clients need to refer you.

By referring you to others your clients confirm their decision to use you in their own minds. You can actually increase client satisfaction by asking for referrals.

2. You don’t know how to ask. The words you use when you ask for a referral matter greatly. Use the wrong words and you sound selfish, sleezy or worse…desperate.

As I coach business owners to get more referrals, the easiest way I’ve found is to simply ask your clients for introductions.

And be specific about who you want to be introduced to…name names if you can. (I’ll talk about the importance of being specific in a moment.)

3. You don’t know when to ask. Timing is everything. Should you ask at the moment the ink dries on the contract, at the end of the project or somewhere in between?

One of my clients makes a habit of asking anytime a client thanks him for his work. It goes something like this:

Client: “Thank you so much for taking care of this for me…”

You: “You’re welcome. I’m glad you feel good about our work together. Tell me, do you know just one friend or colleague who might need my help too?”

Client: “Yes…my friend Mary.”

You: “I’d love to help Mary if I can. Would you please introduce us?”

Client: “Absolutely!”

Simple…and not at all sleezy.

In my experience there is no one best time to ask for referrals. Ask when the ink dries, because a referral here can boost client retention and stave off buyer’s remorse.

Ask again whenever the client praises you (if they’re praising you daily don’t ask daily…but you could certainly ask monthly without being a pest, if you do it the right way).

4. You don’t have a system for asking for referrals. This is where most businesses fail in referral marketing. They just sit back and expect referrals to show up. Some will, but you’re leaving big heaping piles of cash on the table if you’re not stimulating referrals.

You’ve got to create a system to get referrals, to track referrals, to reward clients who refer and to follow-up with the referrals you receive.

Step 2. Be Specific When You Ask For Introductions

I don’t know Someone or Anyone and neither do your clients. Most of the time when I ask business owners to tell me who would be a good lead for them (and I ask it of just about everyone I meet) I get an answer like this…

“Anyone who has a home really…” or

“Everyone with a car is a prospect for me…” or

“Someone looking to be healthy…”

Sounds absurd when you read it. And it makes it almost impossible for me to refer to you. You have now put the work of identifying your prospects onto me. I hate to tell you, but I’ve got enough to do and I’m not doing your work.

You must make it easy for clients to refer you. Do all of the leg work for them. Then use them to do the one thing you really need…introduce you.

Here’s what I use…

The Top 10 List

My friend and mentor Greta Schulz taught me this trick. I keep a list of the Top 10 people, companies or professions I want to meet. I list them on a one-pager and include my contact information and a short sentence or two about how to introduce me.

You can download a copy of my Top 10 List Networking Template and use it for yourself.

When I meet with strategic alliances or when I ask clients for introductions I simply ask if I can share a list of people I’m looking to get introduced to.

They always say yes…then I give them a copy of my Top 10 List and ask if they know anyone on the list.

You’ll be amazed at how quickly you’ll get introduced to the 10 people on your list. Then you add another 10 and off you go.

I used this technique when I moved to Tallahassee, Florida in 2007. I knew 2 people in the business community. In just 12 months I was “plugged in” and all of the key people I needed to meet were in my network.

And the best part is that you’ll look like a networking rock star when you use this one little tool. People will ask if they can copy it (and you’ll always say “Of course!”)

One little ninja trick: Ask the other person for their Top 10 List so you can help them get introduced to people you may know.

They’ll fall all over themselves thanking you. Unfortunately, only 1 in 100 will ever send you anything.

So make your list today!

Do Some “Reverse Prospecting”

This is a master technique, that’s so simple, but no one does it. Call one of your closest allies (someone who you have a solid relationship with) and invite them to lunch. Let them know that you want to refer more business back and forth.

Then ask them to bring their client and prospect lists. You take yours.

When you get to lunch swap lists. You check their list for prospects and they check yours. Then agree to make the introductions within a week of your lunch.

Sometimes that’s all you need to create a flood of referrals.

Step 3. Follow-up Quickly

Referrals get stale faster than a carton of milk from the gas-station convenience store.

Commit to following up immediately with every referral. It shows respect for the person who gave you the referral and it serves the person you’re being referred to.

I like phone calls better than emails. They’re more personal and your goal is to build a relationship.

Send a thank you note to the person who referred you.

If you end up doing business, send the referrer a gift. You don’t have to spend a lot of money, but sending something will go a long way towards getting more referrals from that person.

Here’s your assignment:

1. Decide how and when you are going to ask for referrals. Write down your plan in 2-3 sentences. Having it on paper will help you stick to it. Write out the words you’re going to use to ask for introductions. Then practice with a friend, you spouse or your dog. The point is to get comfortable with the words you’ll use before you’re in front of a client. Once you’ve decided when to ask. Add it to your checklist at that part of your sales process.

2. Make Your Top 10 List. Download my Networking Top 10 List template and edit it to be your own. This one step will take you less than an hour and will set you apart from every other business in your area. Just do it.

3. Write your follow-up system. Write down the steps you’ll take to follow-up with each and every referral. Make a checklist and don’t forget to take care of the people who refer you.

Do you need more referrals and don’t know where to start? That’s why I created the Get More Clients System. To help business owners and entrepreneurs get all the clients they need to sleep like a baby every night…without worrying about how to make payroll next week. To learn more, request a Get Acquainted Session.

To your success!

Small Business Marketing Consultant Steve Gordon

Did you reach your goals in 2009?

I hope you hit all of your goals for the year in your small business…if you did, congratulations! If not, don’t worry, you’re not alone. I can tell you honestly that there are a number of things I want to achieve this year that just didn’t happen.

I’m reevaluating and planning now for 2010 and you should be too.

The problem I see a lot of people make is that the goals they set are never defined well enough to really know if they’ve reached them. It’s like running a race without a finish line.

You’re setup from the start to fail, because you don’t know what success looks like. Clarity makes goals measurable…without measurement there is no finish line.

But how do you get to clarity…

Frankly, nothing’s more intimidating than staring at the blank page as you try to write out your goals. I’m convinced that this is why only 5% of people set written goals. Thinking through and describing what success looks like is hard work.

That’s why I was so excited to sit through a talk by Bill Liccione a few weeks ago. Bill’s talk was on incentive compensation, which revolves around setting goals and rewarding the achievement of measurable goals.

Bill shared two simple questions you can use to produce measurable goals:

  1. Can I tell the difference between a good outcome (met the goal) and a bad outcome (didn’t meet the goal)?
  2. How?

By writing out the answer to “how” you can make any goal measurable (not numbers required). You end up describing what reality looks like after you’ve achieved the goal.

If you really want to get powerful results, create a range of acceptable outcomes. Let’s say for example that you want to increase your sales by 10%. Well it’s almost impossible to increase sales by exactly 10%. You’re likely to by somewhere above or below 10%. So what range are you shooting for?

You can set your range by answering three questions:

  1. What does it mean to exceed the goal? In our example, maybe a sales increase of 12%.
  2. What does it mean to meet the goal? Let’s use our 10% increase.
  3. What does it mean to not meet the goal? Anything below a 9% increase. This is the “anything below is unacceptable performance” number.

Try this framework for your 2010 goal setting…I hope it helps you make 2010 your best year in business!

What Highly Successful Entrepreneurs Do That You Don't, And What to Do About It

I spend a lot of time studying and interacting with highly successful entrepreneurs from a variety of industries. If you were to come along with me and meet these "superstars" of business you'd have a hard time figuring out what they have in common. Sure they're all driven to succeed...that's a given. Some are educated. Others are not. They are a mix of men and women from every ethnic background. Most come from modest means, but a few come from money. Some look the part of the "dot-com" ultra-hip entrepreneur...most look like regular guys and gals.

But they all share one behavior that I know is the secret to their success...

They implement FAST!!!

The time between when they have an idea and when they act on it is very short and they're always trying to make it shorter. This is THE one success secret for a very simple reason. My entrepreneur friends make and IMPLEMENT more decisions then their less successful colleagues.

So in a year's time they have implemented 200 ideas, while "normal" business owners might analyze and agonize and only implement 20 ideas. Let's assume that in both groups the hit rate for ideas is the same...say 10%. So normal business owners might have 2 hits during the year, but the entrepreneur will have 20. The entrepreneur is more successful just by virtue of the numbers.

So let me give you a few examples of what I mean by fast implementation from my own recent experience.

• Driving back from South Florida earlier this week I was on the phone with a friend discussing his marketing. We had the idea to host a teleseminar to generate leads for this business. Within 5 minutes of birthing the idea, we chose a date (two weeks out) and a topic.

Today, we'll be reviewing his rough draft of the presentation and approving the postcard that will be mailed to promote it. It's been 34 hours since we decided to do the teleseminar. That's what I mean by speed.

• Last month I attended my CEO mastermind group (I meet with 12 other CEOs for one day a month to discuss opportunities and issues in our businesses...a very valuable exercise that I'll write about in a future article). I presented my opportunity and one of the members gave me the name of someone that could help me with our idea. On the next break (not when I got to the office, not the next day...the next potty break), I was on the phone with our local Economic Development official asking for an introduction to this person. Not only did I get the introduction, but I got a meeting set before the end of the day.

• Last month an entrepreneur friend got an email from the editor of his local business journal publication asking if he'd write an article for the upcoming issue. He responded with a phone call within 60 seconds...the editor said "I've never had anyone respond so quickly before." My friend turned that quick response into a monthly column in the journal which positions him as the expert in his field and is driving leads to him as a result.

Here's the real magic...successful entrepreneurs who implement fast have a HIGHER hit rate than slow implementing business owners. Why? Because opportunity is fleeting. By the time the slow business owner finally does something, he's often missed his chance.

Now for the good news. Fast implementation is a BEHAVIOR you can install in your life. Write down the following on a 3 x 5 index card and carry it with you for the next 21 days (it takes 21 days to create a new habit): "I will implement ideas FAST."

Read it in the morning when you wake up and several times during the day to remind yourself to speed up. When presented with a decision, idea or opportunity, do something about it immediately. Do anything...taking a first small step will start the ball rolling and you will gain momentum with each small step.

Going back to my teleseminar example. We had the idea and immediately said "let's set a date". We gave ourselves two weeks. If we had not set the date for the event right then it would have taken us a month or more to do the teleseminar. We took one very small step, picking a date, and it set the whole thing in motion.

What idea did you get while reading this article? Post a comment to tell us what first small step you're going to take...then go do it. Now!

5-Step Action Plan to Grab More Customers in the Recession - What You Can Learn From Wal-Mart's Electronics Move

This week Wal-mart is rolling out an expanded electronics selection in 3500 stores across the U.S. Wal-Mart has never been given much respect as an electronics retailer. Until recently, they only carried 2nd and 3rd tier brands. They've been improving their selection--offering products from manufacurers such as Apple, Dell and Samsung. And this week, they're kicking it up a notch. The new electronics section will include Sony TV's, blue-ray DVD players and the new Dell Studio One 19 (when it's released later this quarter).

The strategy is aimed directly at sucking up the customers that Circuit City's demise is leaving on the table. Until now, most analysts saw Best Buy as the big winner following Circuit City's backruptcy. But Wal-Mart shows us a great recession strategy.

In every industry, established players are dissapearing. When they do they leave big opening for the players who are left standing. Despite all of the challenges we face in business, right now, this is THE best time to start leaping to the next level.

So here's the five step action plan that you can use to capture market openings like this:

  1. Identify your 5 weakest competitors (hint: make a list)
  2. For each of the five, write three parts of their business that you WANT to capture and can capture. Wal-mart's answer: TV's, Video Games, Cell Phones (Computers and DVD's...more than three is OK). If it's not business you want, don't waste time thinking about it.
  3. Choose the first step you will take to position yourself to capitalize on your competitor's weakness for each of the areas of business.
  4. Prioritize the list of competitors and types of business based on which area will be most profitable for you to expand into.
  5. Take action on the first steps you identified. Do this on the top three competitors' businesses. That's at least nine areas of business (3 competitors x 3 of their business you want). Execute all nine first steps simultaneously.

You need to execute all nine at the same time because you don't know where any of them are going. You may find that a few steps in, your number one item is unachievable. That's OK. You've got eight more. But if you start at #1 and do them one after the other, you'll be lucky to make it through #3.

What approaches have helped you succeed in tough economic times? Share your ideas below.