One of the best ways to grow your business is through existing customers. Their referrals carry serious weight with new prospects. That’s why learning how to ask for referrals is such a valuable skill.
But what do you say? Who do you ask? And how do you do it?
Answering these questions is part of building a successful referral strategy – one that ignites a virtuous growth cycle for your business.
Happy customers introduce you to new leads who then become happy customers who introduce you to new leads and so on…this is the goal.
When your referral engine is humming, you don’t have to spend as much time or money to acquire new customers. Your CAC goes down, and you can spend more time delivering exceptional services.
The key is to treat your referral partners with respect and appreciation – similar to how you did when you were pursuing them as customers. You want to deliver an exceptional experience that reminds them why they chose to work with you in the first place.
This is what sets the stage for a great referral. Your customers should want to refer you.
Remember – their reputation is on the line. If there is any chance you won’t represent them well, they won’t pass you along to their best contacts.
One of the best ways to ask for a referral is over a personalized video. Videos are warm and memorable. They make viewers feel more connected to you.
And if you used video messages during your sales process, using it again to ask for a referral reinforces to your customer what made their buying process with you special.
(check out this post for more coverage on video prospecting in sales)
Check out the video below and then continue reading to learn why referrals are so important and how video messages unlock your referral strategy.
Why Referrals Matter
According to a recent study by McKinsey & Company, positive word of mouth is the driving factor behind 20–50% of all purchasing decisions.
The problem is that products and services are easy to find, but the amount of information we have access to is overwhelming! It’s easier to ask someone we know for a recommendation.
Hubspot reports that 83% of us rely on referrals from family and friends for making purchasing decisions.
“People influence people. Nothing influences people more than a recommendation from a trusted friend. A trusted referral influences people more than the best broadcast message. A trusted referral is the Holy Grail of advertising.”
– Mark Zuckerberg
In reality, anyone in your network can be a referral source. However, your existing customers are likely to drive the most business because they understand what it was like to be a lead or prospect.
When someone gives you a referral, a few things happen:
- Leads enter the buying journey with the expectation they are going to have a great experience. This tends to start the relationship on a positive note.
- Leads are more likely to become referrers themselves. People are happy to refer you if you’ve proven you handle your referrals with care.
- Customers feel even more connected to you. Asking for a referral – especially over video – reaffirms positive beliefs about you as a salesperson.
- Your profitability improves. A referred lead costs less to convert into a customer. The amount of energy it takes to close a deal decreases while your overall closing rate goes up.
If you can nail your referral strategy, the cycle below starts to take shape.
The Referral Cycle
Every step in the referral cycle is important. Keeping each of these stages in mind is crucial for building a strong referral foundation.
1. Exceed Expectations
If you aren’t doing your best, people aren’t going to refer you. Lay the groundwork for asking for a referral by providing an excellent customer experience upfront. Don’t just meet expectations, blow them out of the water.
2. Engage
Keep engaging customers even after you’ve made an initial sale. Figure out ways to deliver value and stay face to face so that when it’s time to ask for a referral, it’s an easy decision for them. It’s harder to get a high-quality referral if you haven’t spoken to someone in a long time.
3. Use Multiple Channels
Use multiple channels to keep up with existing customers (i.e., potential referral sources). People spend time in different places online and in person. Staying top of mind with people in your customer base often means maintaining a presence in various places.
4. Create Several Advocacy Channels
Set up a few places where people can advocate for you and your business. In the same way that you should engage customers on multiple channels, give them several places to share praise.
For instance, you could have testimonials or reviews on your Facebook page, website and Google Business page.
The channels you chose should align with where your best potential customers are most likely to find you. It doesn’t help having Yelp reviews if your target customers don’t consult the platform for advice about your product.
5. Make It Easy
When it’s time to ask for a referral, you want to make it as easy as possible for the referrer. Create a description of what types of leads you serve best and how you help them. Determine exactly where you want them to send referrals or how people should contact you.
Your referral sources may not all fall into your ideal customer profile (ICP), and they may not have found you through traditional means. Giving them clear directions on who and how to refer removes any potential friction or uncertainty.
The more the referrer has to figure out, the less likely they are to follow through. Remember, they have their own priorities outside of your success.
6. Make the Ask
On a related note, don’t expect past customers to send you referrals, even if they loved working with you. You have to ask.If you can give them a reason why now is a great time to refer, even better.
Maybe you’re launching a new product or focusing on a more specific type of buyer. These are great excuses to initiate a referral conversation and get someone excited about suggesting you to their network.
You can make the ask over any channel that makes sense. If you’re sending an email or text, consider including a personalized video message that references your past partnership and why you enjoyed working together so much.
(for a list of email templates you can use in your sales process, check out this article)
7. Say “Thank You!”
After people give you a referral, thank them. Showing your appreciation makes it that much more likely they’ll do it again. And as always, saying “thank you” is best done over a video message – the recipient will see the joy they’ve inspired through their referral.
Here’s a great example of this…
After the Referral
The onus is on you to deliver after getting a referral!
Even though the relationship with a new prospect is starting on a great note, you still need to bring your A game. After all, you may be asking this prospect for a referral one day.
If you need help with your cold calls and outreach, check out this blog post here. Even though a referred lead isn’t technically “cold,” the strategies in the article can still be useful.
And if you’re working on your on-call skills, here are 25 open-ended sales questions you can start using today in your discovery calls.
Finally, to give video messaging a try, start a free 14-day trial with BombBomb here.
