What does it take to build a client referral system for your business?
Building a client referral system takes effective communication and networking skills, the willingness to go the extra mile for your clients, patience, and perseverance until your referral system is working.
In today´s blog post, I will share a 7-step client attraction system that helps you build a solid foundation so your referral system works.
In a prior blog post (March 2020), I shared a personal example of how I built my law practice upon a referral system. I highly recommend this system because it can help you expand your business continuously and organically.
- How does a successful client referral system work?
- What are the benefits?
- What are the components?
- How to build your successful referral system in 7 steps
How does a successful client referral system work?
What does a potential client do when they are in need of a product or service?
- They might ask a friend, colleague or family member for a recommendation.
- Or they might search online and read some reviews to find the right solution.
- They will then reach out to you if you were recommended. It is that easy!
What are the benefits of a referral system for your business?
- Benefit #1: If they found you through someone they trust and who´s already gone through the process with you, the potential client trust that you can also help them.
- Benefit #2: If they found you through an online search and your website includes enough of your story, experience, and credentials, they´re already inclined to use your services.
- Benefit #3: It requires little financial investments.
- Benefit #4: A successful referral system has the potential to increase exponentially. One referral leads to two, three, and so on – all from a single client.
What are the components of a successful referral system?
Designing a successful referral system requires that…
- You make it easy and motivating for clients to take the step of making a referral.
- You automate it as much as possible.
How to build your successful referral system in 7 steps
Step 1: Define your ideal client.
- Targeting the right clients is essential for the success of your referral system.
- Take a look at your target clients. They likely share key characteristics that make them ideal for you. For example, their personality, revenue, paying on time, demographics, profitability, company size, etc.
- A deep understanding of your ideal client is vital to describe this person to your referrers.
Step 2: Tap into your network
As a service provider or seller of products, you understand your ideal clients and you know how powerful referrals can be for your business. The challenge is you don’t know how to tap into your networks to proactively get referrals.
Reasons why you might hesitate to reach out to your network:
- Reason #1: You are uncomfortable asking for referrals.
- Reason #2: You don´t want to appear “sales-y” or desperate.
- Reason #3: You are not sure if you actually deliver value to your clients.
Exercise: What is blocking you?
- What is blocking you to get a consistent stream of new referrals?
- Dig deep and write down your answer. Then ask yourself, is this true?
- I invite you to go deeper to find the root cause of what´s blocking you.
- Then make a conscious choice to replace this with something empowering that feels exciting to you.
- Nothing should block you any more to reach out to potential referral partners.
Step 3: Identify your best referrers
- Referrers are people who know your business and already think highly of it.
- They can be family members, friends, clients, vendors, and other service providers.
- Once you’ve identified your referrers, reach out and tell them how your business is unique and how you make a difference for your ideal clients.
Step 4: Educate your referrers
- Help your referrers understand who might be a potential ideal client for you.
- Provide valuable content that your referrers can share with their networks, such as reports, articles, and guides.
- Maintain an up-to-date LinkedIn profile so your referrers can provide online introductions and make connections virtually.
Step 5: Ask for referrals
Asking for referrals can be challenging and intimidating. You may worry that your client will think you’re pushy. My experience in asking for a referral is that 99% of clients will respond positively. They are grateful for your service and would like to be supportive.
One idea is to post “Referrals Appreciated” on your website, newsletter, and in your email signature. This is a good option if you have a broad base of referral sources that you reach out to on a regular basis.
Step 6: Measure your referral system
In order to leverage your referral system for the best results, you need to track your referrals and analyze them so you can answer the following questions:
- Who is my best referral source?
- What’s the Return on Investment (ROI) for my referral system?
- How can I refine my referral system for a greater ROI?
Incorporating these metrics will help you to create an effective referral system that drives business and makes you more profitable.
Step 7: Appreciate your referrers
When you show your referral sources that you appreciate their support, you’re ensuring their continued enthusiasm for sharing your message.
There are many ways to appreciate your referral sources:
- Make a phone call, send an email, or handwrite a note to express your appreciation when they make a referral.
- Send them a gift card, or grant them discounted products or services to express your appreciation when one of their referrals converts.
7-steps in building a successful referral system:
- Step 1: Define your ideal client
- Step 2: Tap into your network
- Step 3: Identify your best referrers
- Step 4: Educate your referrers
- Step 5: Ask for referrals
- Step 6: Measure your referral system
- Step 7: Appreciate your referrers
I´m available to support you through this difficult time by re-imagine your business, by helping you build a successful referral system that moves you back onto the path of success.
Contact me for a complimentary 30-minute strategy session:
Coming up next month…
In my next blog post, I’ll share how to use different business strategies to build your business successfully.
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