Even though most sales representatives and business owners are quick to tell you that most of their business comes through referral, very few have a proven system they consistently apply in order to ask for referrals. And, far few have an actual plan to ask everyone they come in contact with for a referral.
The old system of asking everyone you do business with, “Can you refer me to three people you know that might benefit from my product or service,” can be effective, However, there are stronger methods of asking.
Try one or all of the following asking techniques to improve your referral rate:
The Timed Request
Midway through the sales process set up your request for a referral in advance. Tell the prospect why you are going to ask and when you are going to do it. This will anchor the idea in their minds so that they won’t be surprised later, and they will at least be subconsciously thinking about it for the next couple of months. “John, I get the majority of my business through referrals. If after 60 days you are happy with our product/service, would you mind if I followed up with you for three introductions?” Most people say something to the effect of “Yes, as long as everything goes well, I would be happy to refer you.” Now you have permission to call them later, and they have agreed to help you. Schedule the call in your CRM system immediately and ensure they are a happy customer.
The Negotiated Request
If a client pushes hard for a discount during negotiations, it is possible to include referrals in the actual contract. I am never a fan of giving a discount without some type of reciprocity, as it will make your original price lose some legitimacy. If they ask for something, it is fair and often expected for you to ask for something in return. And, many clients love the idea of giving a referral because it does not include lowering the value of the deal nor cost them anything more than five minutes of their time.
“We don’t have a lot of price flexibility, but we do get the majority of our business from referral. I think I can get a 10% discount approved if you will agree to sign this month and can send us three referrals within the first sixty days after signature. What do you think?” After you ask the question, be quiet and let them completely answer the question. It is very important that you do not interrupt or ask additional questions. I have used this technique to great effect and will often add it as a line item in the contract. If they don’t remember when I call them in sixty days, I refer to the contract. Most people are happy to help and keep their promises.
The Introductory Referral
The easiest referral to ask for is the introductory referral, but it takes some homework on your side. If you are not currently using Linkedin as a prospecting tool then start today. Begin by connecting to every single person who knows you at every account you have ever signed in your entire career. It can change your life! Look for those best fit companies that you wish you could do business with, and see if any of your current customers are connected to someone at the target. Now, here is the trick. When you find a connection, do not use the Linkedin introduction process. As of this, writing it is mostly confusing to people and is not very effective. Call or meet with the person you are asking! “Mary, I noticed you are connected to Tom on Linkedin, would you mind introducing me to him?” But don’t stop there. Make it as easy as possible for Mary to refer you. Say to her, “If you think it would help you, I can send you a couple of sentences about how I might be able to help them.” Nearly everyone says yes to giving introductions, especially if you have been a valuable help to them.
Asking for referrals is not extremely difficult if you have a plan and understand who you will ask and how you will do it. A solid referral program can greatly help you expand your business with no cold calling involved as you are already talking to people who know and like you. Your first step is to make the decision to ask and ask often.