Are You Referral Ready?

Archive for the ‘Connecting with Your Customers’ Category

Most companies can tell you who their top salespeople are, how much they sold, and how they ranked when compared to the others. Referrals from your customers can be harder to track, but it doesn’t take a sophisticated spreadsheet to identify and celebrate the customers that have contributed the most to your overall growth. Thanking customers is one thing; promoting them is thanks in action.

For years “customer service” has been used to describe something given TO the customer by the company. Very few describe customer service as something that gets done FOR the customer by the company. This subtle yet dynamic shift is more powerful than profit, and companies that ignore it stand to lose market share to those that embrace and apply it as policy.

Identify your top three referral-generating customers. Brainstorm ways in which you can promote or support their efforts, such as contributing to their favorite charity, featuring them in your newsletter, or hanging their picture in the “hall of fame” in the lobby. Seek out and celebrate other top producers as a regular part of your marketing strategy.

Your top-referring customers have a name, a face, and an appreciation for a long-term relationship. By honoring that relationship, you inherently strengthen their loyalty and build social capital. When you make the effort to reach out and acknowledge people, a little goodwill goes all the way to the bottom line.

Customer loyalty expert Fred Reichheld uses what he calls the “net promoter score” to measure the difference between customers who promote or detract from company growth via word of mouth. The core of his work challenges companies to ask the customers one simple question: “Would you recommend us to a friend?” How much more profitable would your company be if your net promoter score was the highest in the industry?

Bad profit is earned at the expense of customer relationships, such as whenever a customer feels misled, when companies save money by delivering a lousy customer experience, or when salespeople push overpriced or inappropriate products. Bad profit does not show up as such on a balance sheet, but it has a dramatic negative effect on company growth.

Choose six random customers: a 1-month customer, a 3-month customer, a 6-month customer, a 9-month customer, a 1-year customer, and a more than 1-year customer. Offer an incentive for the customer to respond in writing (either online or via snail mail) to the question: “Would you recommend us to a friend?” Create a schedule for maintaining regular contact with current and future customers.

By making customer loyalty a priority, referrals and repeat sales and profit take care of themselves. When you have a mechanism for differentiating between and measuring good profit from bad, you are building a foundation for the kind of growth that the bottom line alone will not fully reveal.

If the purpose of networking is to serve other people, then that includes customers as well. They come to you for a specific product or service, but obviously they have other needs and things going on in their lives. The more you know about their situation, the greater position you are in to help.

You don’t want to sell one product to one customer one time…you want to sell to them again and again, and have them refer other people as well. You are selling a car to a customer, but that customer is largely responsible for whether you get the opportunity to sell a car to his wife, his brother, his sister, his children, his neighbor, and so on. Relationship selling is built on human connections, not financial transactions.

Make a list of three questions you can ask each of your next 10 customers. The questions can be anything you want, but the answer has to let you know whether they might need the services of someone in your network. Rather than reveal your contact up front, make a follow-up call or send a letter with your contact’s business card.

When you network effectively, you build a team of trusted service providers that you can confidently refer at any time. When you ask questions and learn about your customers, you find out how your network can best serve their needs. When you do both, you position yourself as a well-connected business resource above and beyond whatever you do for a living.

Wines for Humanity is a company that offers in-home wine testing parties. They are dedicated to “educating people about the joy of fine wines while raising funds for charity”.  This combination supports consumer research that reports 78% of adults said they’d be more likely to buy a product associated with a cause they care about, and 66% said they’d switch brands to support a cause.

People support causes they think make them better people. It doesn’t have to be a charity. Southwest Airlines rallies their entire company around the idea of  “freedom”. The default cause for any business is profit. Only a deliberate effort will change the emphasis from profit or shareholder value to a cause-driven strategy that consumers can embrace.

What societal issues have the greatest impact on your target customers? Does it make sense for your company to consider teaming up with a local charity to enhance its perception in the community? Which causes are you ready, willing, and able to support for the long-term?  Brainstorm ideas how your company can do a better job of integrating social issues with business strategy. Put one plan into action in the next 90 days.

One of the best ways to win the hearts of customers and build stronger emotional connections with them is through long-term support of a social cause. In the true spirit of  “givers gain”, people who believe in your cause will share your vision and recruit new advocates as well.

It is not always possible to know where your referrals come from. But when you do, never underestimate the power of saying “Thank you” to reinforce behaviors you want repeated.

Sometimes we take referrals for granted and have the best intentions to thank the referral source as soon as possible. Then another day goes by, and another, and another. Passionate customers might tell you they don’t expect to be rewarded or recognized, but you can never go wrong by acknowledging the gracious act of a referral.

 Make a list of customers that you know have referred business to you over the years. A thank-you in the form of a handwritten card, small personalized gifts, restaurant gift cards, and sometimes even money deepens the emotional connection with your customer. Decide how you are going to thank the people on your list, and make it a point to actually follow through.

 Referrals are presents. Just as it is appropriate to thank someone for a present, it is appropriate to thank the people who put enough trust in you to service other people they care about. When you schedule time to make “thank you” a regular part of the process, you maintain a positive balance of deposits and withdrawals that you can draw upon another day.

Strong referral systems are a ‘get what you ask for’ proposition. The most successful system can be used every time with any client or person in your network. Since customers can be a valuable part of your referral network, it makes sense that you would have a system for helping them share the value they experienced with other people they know, like, and trust. Think of it as creating a road map for success.

Asking for referrals can be uncomfortable, but it is a vital part of any referral generating system. Once you are comfortable with the system, you will have developed a mechanism for removing any doubts or psychological barriers that might keep you from executing it. When it becomes just another part of the way you do business, it becomes just another part of the way you consistently share value with others.

Think of a client who you know is exceptionally pleased with your work. Ask him or her to share what they considered to be the most valuable part of the experience. Ask if they know anyone else who they would like to see get that same kind of valuable experience and if they would feel comfortable making an introduction either in person, in writing, via e-mail, or by phone. To raise the client’s comfort level, demonstrate exactly how you would approach the contact after the introduction.

A process will help you diligently execute results-driven behaviors until they are second nature to you. This approach is successful because it involves customers sharing value with people they know instead of you cold-calling people you don’t. When you give yourself permission to ask for referrals, you give yourself permission to acquire new clients at a much lower cost.

You will find St. Louis Cardinals fans around the world and recognize them by the redbird logo on their red and white attire. Harley riders enjoy the same sense of community, no matter where they are from. Only recently have businesses begun to recognize the power of this social phenomenon as an important marketing tool.

Businesses with customer communities build loyalty and support from people who enjoy being associated with your brand. Because these communities are socially driven, they exist formally or informally whether a business recognizes them or not. Ignore them and your business will never benefit from the collective word-of-mouth energy of an impassioned community.

Think about the experience your customers share. Now brainstorm ideas how your company can help define and celebrate its customer community. Try to create an event, club, user group, blog, online bulletin board, e-mail discussion group, newsletter, or web site dedicated to bringing your community people together either online or in person.

Building community allows customers to share experiences and feedback with each other. When the bonding between company and customer shifts from a personal or professional transaction to a social experience, loyalties on both sides are strengthened. An impassioned network of customers will refer your business more loudly and clearly when a social forum to do so is made available.

The music business understands this concept instinctively. When your favorite artist or musician releases new material, you immediately purchase or download it without so much as hearing one note. You are that emotionally invested, and you want the connection to continue so you purchase tickets to see him/her in concert. Because it’s the music business, we call people like that fans. In fact, they are a special kind of customer.

The emotional connection between you and your fans takes time and effort to build. Keep in mind that consumers have become very demanding in terms of how companies market to them. They can smell phony from a mile away. One of the most trusted sources of purchasing information is word-of-mouth, and fans are the champions of word-of-mouth marketing (both positive and negative). Either you take care of your fans, or your competitors will.

Do your best fans have the tools to refer you to others? Are they being properly rewarded? Can they earn discounts on exclusive products or services? What motivates them to promote your product so strongly? How can you best support the relationship to maintain their loyalty?

Customers are price-driven. Fans are experience driven. Improve the experience to create more fans. Customers are surprised by good service. Fans automatically assume you will delight them. Provide service worth talking about to create more fans. Customers are indifferent to your company. Fans actively invest in their relationship with you–time, emotion, attention, and money. Invest in your customers to create more fans. Customers want you to sell them products. Fans want personalized advice and solutions. Get personal with your customers to create more fans.

Like a board of directors, a customer advisory board can offer direct feedback and insight into the company and its marketing strategy. Meeting with clients one-on-one has its benefits, but a group setting can be even more powerful. How many of your customers would appreciate being included on an advisory board? There is only one way to find out.

Listening to your customers is important. Making sure they FEEL listened to is even more important. For many people, a group setting provides a safer environment for honest feedback. By definition, any marketing strategy that does not include the voice of the customer will produce marginal results at best.

When you or your company turns free advice from customers into business strategy, marketing becomes a true reflection of what the people want. A customer advisory board allows customers to interact, and those genuine conversations fuel word-of-mouth referrals, customer satisfaction, and future sales.

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.