Fall 2008 - Marketing Dimensions from Felber & Felber Marketing

	Fall 2008

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The Culture and Ethics of Referral-Based Marketing Programs - Part Two

By Rob Felber
In part one of networking and referrals I wrote about clearly defining your prospect and targeting your message. With your vision clearly defined, you can find ways to incorporate your referral goals throughout your advertising, direct marketing and publicity efforts. But, how you ask for referrals, respond to others needs and treat referral opportunities is where the rubber meets the road. Let's take a look at each of these situations and some tactics around them.

Asking For Referrals

This sounds simple enough—so, why don't we all do it? Many of us are uncomfortable with asking people for money or, heaven-forbid, their business. Referrals, and the process of getting them, are close cousins with sales. Some people simply get very nervous around the sales process.

You work hard at what you do. Whether you sell a complicated technology product or provide the simplest personal service, there are pivotal moments of truth for every business owner.

The best time to ask for a referral is when the client has just received the service you provide and is happy. Consider approaching this conversation by saying, "I am pleased you are so happy with our services. We do our best to work hard to provide quality work and hearing your praise really lifts our spirits. Would you know of anyone else that would benefit from our (insert the service they just raved about)?"

Now, there are two ways to take advantage of this situation and raise the bar higher on your referral practices: 1.) Help them recall the names and 2.) Ask if you can use their testimonial on your marketing efforts. The first point, helping them recall the names is just that, allowing them the intellectual time to think about who they would refer to you and why. You can prod them along on this process by having them work through their mental rolodex. If you rush the process of asking for names, they may go blank and could simply reply with "I would love to help and will certainly let you know when I think of someone for you." (Just to let you in on something... they rarely follow–through on this promise!)

Instead, while they are happy, have them tell you more about their business and professional life. Get them talking about who they work with, play golf with, spend time with away from work, etc. I call this, "priming the pump." Now that the names of these friends are fresh in their mind, you can redirect the question to "Would any of your business–owner friends, or those golf buddies, benefit from what services we offer?" With the names fresh in their mind, they can think about each person and whether they see that person as a fit for your firm.

The second point to asking for a referral may provide them some value–added free advertising. By asking them for permission to feature them in a case study about the work you just completed or using their testimonial, you are not only demonstrating to prospects your ability to perform, but you are also helping your client gain recognition. Write about something specific you did, maybe it was your marketing efforts for their website or new literature you created for them—something they are proud to show off. Now, add more value to this effort by offering the story to your industry publications; with a third party (editor-approved) article in your trade publication and you have really hit the jackpot.

Responding to others needs

To quote Zig Ziglar, the famous salespersons' salesperson, when talking about potential referral sources, he said, "If you help those around you get what they want, you will ultimately get what you want." The key word here is help. I want to be perfectly clear here; helping each other with referrals is NOT the same as making it a requirement of your relationship (or lack there of) with a referral partner. A common networking mistake is to fall into the "I will give you referrals if you give me referrals" relationship trap. Even though this approach is free and while this may work with some businesses, I personally do not feel this is the best approach for a few reasons. More times than not, the so–called "referral partner" does not take the time to learn what a good referral is for you. The referrals they bring to you are unqualified and inappropriate. Primarily these people are only focused on their needs and what referrals you can bring to them. Rather, make sure you have their best interests in mind, with no strings attached. By truly "helping" each other, you will foster a stronger relationship.

As luck would have it, just as I am writing this article, an email came through with this very impersonal message in their long–winded sales pitch (edited to protect the incompetent):

Take advantage of our refer a friend program. If you (as a XYZ client) refer a friend to XYZ who becomes a client, you get 1 month of free service! In addition to blah, blah, blah we also do this–that and another thing. Ask me for a quote!

Talk about impersonal and throwing a bunch of spaghetti on the wall to see if something sticks! I avoid all situations that sound too good to be true because they usually are. I refer because I want to, I like the person and I have had a great experience myself. The experience is personal and focused.

So, why are there all these networking events complete with free food and lots of sponsors? The short answer is they work – but, only for a select group of people. These people know how to build relationships. Yes, if you have just happened to fire your insurance person or a parent is aging rapidly, you may be in the market for a new policy or an assisted living facility. Networking events work like buying a car. You do not notice the ads until you are in the market. If you are not in the market, you just walked the aisles looking for the one with the best prize or the Godiva chocolates.

Make it Work

It comes down to my philosophy on "give–to–get." At Felber & Felber Marketing, we are constantly striving to connect our clients with each other and the companies we personally interact with in a variety of professional organizations. By helping those within our network connect, we are broadening our personal network and building on what I call our "reputation capital."

How can you increase this notion of reputation capital? In our world, just as yours I am sure, there are folks that do not directly purchase your services, but may have direct influence on the decision. With us, it may be a financial expert, a venture capitalist or even a vendor we use. By genuinely referring quality leads without the fear of any strings being attached to our referral, we position ourselves as reputable, likable and best yet, resourceful to our clients/prospects/community.

Oftentimes, we will use our media and business resources to refer potential publicity opportunities to non–clients. In using this approach, a respected culture is established within your organization and amongst your network. Unlike your peers, you are then viewed as a person who cares about others and is not looking for profit in everything they touch.

How to Treat Referral Opportunities

If I gave you a solid 24 carat gold brick, would you throw it away or leave it in your trunk for six months? I'm pretty sure you would consider anyone foolish to even think to throw a prize like that away. Then, why would you even think to treat a referral like an interruption or a chore? These referrals are not only golden opportunities for you, but also for the person who gave them to you. The person who gave you the referral has put their reputation, even their livelihood, on the line for you. If you wait to follow up, react non–professionally or just never call, they look foolish and take the reputation hit—not you. You may very well have turned your own positive cheerleader into your own worst enemy.

Whether the referral is good for you or not, some sort of action is needed immediately. First, start by thanking the person. This can be verbally or as creative as a gift basket or tickets to their favorite play or sporting event. No need to go overboard, but something to let them know you truly appreciate their time and thoughtfulness.

Then, find out exactly what your colleague promised. Did they say you would call, simply send information or arrange a personal meeting? You guessed what's next – do it! And most importantly, do it the very same day you get the referral. You show respect for yourself, the person who referred you as well as your new prospect by prompt action.

Now, you may be asking yourself, "What if the referral is a bad one, or just not what I'm looking for?" Take a look back to the referral focus you established from the beginning and see if there is a disconnect. If the lead is not appropriate for you, take responsibility and change the information you are putting out there. You may be sending your referral partners the wrong impression of what good business means to you. Then, gently counsel your referral source on what a good referral is for your company. Simply say, "Thank you for the contact, but our main focus is on (this type) of industry or providing (insert services here)." Be very careful not to make the person feel bad or that their suggestion was unwelcomed. Remember, they did have your best interests in mind. Use this opportunity to better assert what you are looking for in an appropriate referral.

Lastly, don't forget about the person who gave you the referral in the first place. You may have already thanked them, but did you ever tell them what resulted from the referral? This person was very interested in helping you build your business so they deserve to know what happened. They will really appreciate it if three weeks later you call and say "I just wanted to tell you I met with Paige. She liked what we had to offer and thanked me for contacting her. Thank you again for thinking of us." Now, you not only showed your appreciation again, you demonstrated that you took care in how you managed the referral that they gave you. I have to warn you; don't be surprised if you keep getting referrals from this source. If the referral did not work out, for whatever reason, don't place the blame on them. As discussed, you can counsel them on what a better referral is, but do not make them feel bad.

So, think carefully and strategically about your referral program. Understand the nuances of "the ask" and practice this approach whenever you can. Tune your antenna, and those of your co–workers, to the needs of those in your sphere. Find ways to help them throughout the year. Don't forget when you ask for a referral, be sure to help them with their mental rolodex. Add to your reputation capital and ensure that the message is what you want, not what you are perceived to be. Lastly, be professional and creative in any and all interactions.

Contact Felber & Felber Marketing at 330.963.3664 or info@felberandfelber.com.

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