Are You Referral Ready?

Top sales people value recognition. It validates their effort and contributes to their overall sense of accomplishment. Based solely on the recognition you give to your referral sources or top referring customers, how motivated are they to refer you more business?

The moment you start taking a referral relationship for granted is the precise moment it starts to fade away. The “give first” cycle resets when you gain, and offering your best referral sources a little well-deserved recognition keeps the mechanism of reciprocity in proper working order. If your withdrawals on social capital continue to outnumber your deposits, a deficit situation throws the dynamics off balance.

Evaluate what you have done to recognize your top referral sources for their efforts. Did you publicly thank someone who has gone out of his or her way to help you? In the last 60 days, did you send a thank-you gift or card to a referral source who brought you unexpected revenue? Did you introduce the referral source to someone and endorse him or her in exceptionally glowing terms? Did you provide a written testimonial they could use for marketing purposes? Did you promote their business in a newsletter article or advertisement? Try to come up with two ways you can recognize the efforts of your referral sources.

They know you, they like you, they trust you, and they know how to refer business to you. Your referral sources have a lot going for them, and they might also have their own businesses to tend to. What they don’t always have is the motivation to keep seeking referral opportunities for you. Since they probably expect very little in return, a little recognition can serve the referral source and the relationship at the same time.

Listening to your customer is no longer a passive activity that businesses can get around to when they have time. Thanks to a renewed emphasis and the availability of online resources, it is becoming a more integrated and strategic part of the marketing process. Since satisfied customers can be such a huge source of referrals, building an active process for listening to them is a key component of Referral Ready.

Unhappy customers have always used negative word-of-mouth to a greater degree than happy customers have used positive word-of-mouth. The problem is that today, an unhappy customer can broadcast a bad business experience to the entire world with the click of a mouse. Rather than complain privately, customers can choose a more damaging public forum.

Make a list of five A+ clients or clients whose relationship you want to improve. Take them separately to lunch or breakfast, with the intent of asking a lot of questions about your product, your service delivery, and ways to improve your marketing message. LISTEN to what your customers tell you, positive or negative, and take notes so you can refer to that information later. Follow up with a note that expresses how the information was used.

Businesses that tap into and learn from their customers have a distinct advantage. By investing emotionally in client relationships, the Referral Ready business learns first-hand how to better market to clients, how to solve problems before they start, how to make changes with end-user benefits in mind, and how to generate referrals from people who will gladly evangelize about your business…if they feel valued.

Branding your business has many advantages, and among the most important is GETTING MORE REFERRALS.

Think about your own purchasing decisions and how loyal you are to certain products. Once your brand is established, it allows you to win “mindshare” as people speed up their decision-making processes and confidently choose your products or services above all others.

When there is a mismatch between your marketing message and what clients actually think, confusion is the result. You might have the highest quality product on the market, but if your potential clients draw a different conclusion based on your web site or business cards, their perception becomes reality. A confused mind says ‘no’.

Think about the brand associated with your business. Are you the fastest, the lowest priced, the most user-friendly, the most cost effective, or the most universally accepted product on the market? Whatever your claim, analyze the way your business cards, web site, blog, brochures, and office space support that claim. Look for consistency in the way your branding message is communicated.

When you brand your business consistently, you take responsibility for the way your products and services get positioned in the mind of the customer and you back it up with behavioral and visual evidence. Referrals favor the business that owns and communicates a distinct message.

If you want to be Referral Ready, you need a strategy for building relationships that feeds your network and allows you to manage it systematically. Perhaps the most user-friendly system was advanced by Dr. Ivan Misner, the founder of Business Network International (BNI). His system is also known as the VCP model, which stands for Visibility, Credibility, and Profitability.

If two people know each other on a first name basis but not much else, they are at the Visibility stage. If they have actually scheduled and kept appointments together or done business with each other, they are probably in the Credibility stage. If they consistently find ways to refer each other business, they are in the Profitability stage.

Most people equate the networking process only with Visibility, spending more time and energy into building relationships than they do enabling those relationships to yield mutually beneficial results. The “work” part of networking is applying the entire VCP model to your current and future relationships. Visibility is only the beginning.

Now think about the people in your own network. Do you have a strategy to move the relationship to the next stage? What types of activities might best move a relationship from V to C? From C to P? What role does time play in the movement of relationships from one stage to another? In terms of your networking activity, at what stage in the process would you consider your time best spent?

With a process like the VCP model, you can do more with fewer and existing relationships than you can by randomly adding more people to an already crowded network. Success is in the system, not in the number of people you meet. Building relationships has always required the investment of time in other people, not just meeting them.

Your networking activity becomes more focused and effective when it is consistent with your business goals. Goals that are SMART (Specific, Measurable, Achievable, Realistic, and Time Driven) carry the most impact for you and your business.
Without clear business goals, your networking activity loses its strategic advantage. Meeting more people will not necessarily lead to more connections, referrals, or closed sales. As long as this is out of alignment, the results you gain will be minimized.

Can you think of 3-5 SMART business goals that you want to reach over the next year? Try to determine how networking can contribute to reaching each goal. Who can help you? Who can introduce to someone else who can help you? What networking organizations are best suited to connecting you with those people?

Referral Ready means having a networking plan that is integrated with and supports your business goals. It starts with knowing what you want and reaching out to others to make it happen…while at the same time helping others get what they want.

Surely there is something beneficial about being in relationship with you that goes beyond a financial or business transaction. Your referral sources place value in those benefits. They accumulate over time and contribute to the depth and overall health of the relationship. As a result of the benefits you offer your referral sources, how motivated are they to refer you more business?

Reduced to transactional terms, a referral relationship can still serve both parties. But the human factor is what makes me choose you over another referral partner, and you can figure every one of your referral sources has the option to feed another business besides yours. It is their relationship with YOU that makes the difference. Strengthen the relationship and the rest happens naturally.

How you can show your referral sources–the people who are already inclined to refer business to you–the benefits of being in relationship with you? Could you introduce people in their company to influential people in your network? Could you help them secure a new vendor? Could you help them close a deal based on your recommendation or testimonial? Could you attend a trade show or function they were hosting? Try to come up with things you can do for each referral source that adds value to the relationship itself.

Sales people are attracted to compensation systems that offer both cash and benefits. Your referral sources are your sales people. They value their relationship with you, and the benefits of that extend beyond the last referral or the next referral. Perhaps in between is your best opportunity to demonstrate to your referral sources the real benefits of working so diligently on your behalf.

Perhaps the greatest challenge is positioning your business to stand out among the competition in a way that attracts customers and word of mouth referrals. The core of that challenge is your ability to answer the question ‘Why should I do business with you as opposed to the other companies that say they offer the same thing?’

Now more than ever, consumers have choices. Without a compelling reason to do business with you, consumers are bombarded with reasons to consider their alternatives. Either you find a way to stand out, or you become invisible.

Write down three reasons why people should choose your product or service over the competition. If you can’t define your uniqueness in the market, you can’t talk about it and you can’t expect others to talk about it either. If necessary, ask a few past customers why they chose you over someone else. The answers might surprise you.

Referrals travel faster via word of mouth when they have what is called a stickiness’ factor. Your USP (unique selling proposition) is exactly the kind of stickiness that gets and keeps people talking about your business. Customers have a way of seeing past catchy slogans and half-baked promises. Knowing that the value you deliver is unlike any other competitor attracts customers who will surely share the experience with others.

It’s not who you know or who knows you that makes the real difference. It’s how well you know the people in your network. This means it is important to have a mechanism for advancing and adding depth to your most important relationships.

Relationships take time to develop. What you do with that time is the difference between activity and results, between visibility and profitability, between a network of acquaintances and a team of referral sources. Left to chance, this process is called ‘net-hoping.’ Hope is not an effective business strategy.

Schedule time to meet one-on-one this week with two people whose relationships you particularly value. Make it a point to learn something new about that person, and take interest in their goals, accomplishments, skills, and networking activities.

Find a way to help that person tackle a tough business issue. Discuss ways in which you can both proactively refer business to one another.

Meeting one-on-one is a great tool to keep in mind for advancing relationships. Without adding anyone new to your network this week, you can increase your referral readiness by taking the time to learn more about the people you already know.

The return on your time investment in other people can only be as strong as the depth you are willing to achieve.

Failing to plan is planning to fail. …you’ve heard that before, but it applies to networking as well. There are many different networking groups and activities to choose from. The best ones for you are the ones that are in alignment with your goals.

People who network without a plan can still get positive results, but those results are random, finite, and impossible to plan for. Referral Ready means taking responsibility for achieving your goals and making strategic choices about what it takes to get there.

Make a list of networking organizations that might interest you. Include a healthy mix of social, business, and community service groups and professional associations. From that list, explore the possibility of joining two or three different kinds of groups.

Just as an investment broker might advise you to diversify your financial portfolio, a networking plan that consists of different types of organizations will strengthen your social capital. Choose wisely, and get involved based on where your skills, interests, and goals intersect.

A win against the New York Jets this weekend means another trip to the Super Bowl for the Indianapolis Colts. Led by four-time MVP quarterback Peyton Manning, the Colts remember losing to the Jets just a few weeks ago in a game that featured a second-string cast of Colts and ended their bid for an undefeated season.

In an AP story today, Manning was quoted as saying “I think everybody realizes the opportunity and what’s at stake. That’s why I think everybody wants to have a good week of preparation, to put ourselves in the best position on Sunday.”

Imagine that. Putting all those hours of preparation into a game that will last only 60 minutes this Sunday. Film study, strategy sessions, on-field drills, play selection meetings, more drills. When the average fan watches his/her beloved Colts on Sunday, the execution (or lack thereof) is all they will see.

But should the favored Colts move on to the Super Bowl, the players will use cliches and sports jargon and fancy phrases to describe between the lines the relationship between their preparation and the final score. Joe Q. Fan will marvel at the highlights on ESPN, but the players will know the real reward came from the work they put in long before the game ever started, the plays they practiced 25 times on Tuesday and 25 more on Thursday, the extra reps in the weight room, the extra hour of film study that revealed how one player always leaned to the left when they ran to the right.

And should the businessman significantly increase his referral business in 2010, he knows it will be the natural result of preparation that put him in the best position to be successful. Opportunity + the right preparation = winning results.  And it should come as no surprise that that formula applies to sports, education, referrals, or life.

Are you Referral Ready?