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Tuesday, July 22, 2014
Referrals -- Fast Track to High Close RatiosPosted Wednesday, June 27, 2012, at 12:34 PM
Sales is a tough job. Having the courage and drive to pick up that phone every day and face potential rejection requires a thick skin and level of dedication unmatched by most.
Consider that the average close ratio is about 10 percent for most salespeople. Those are tough odds.
Unfortunately, many organizations forgo the simplest of strategies for greatly improving those odds. By establishing a proactive referral generation process, most organizations increase close ratios from a meager 10 percent to a staggering 67 percent.
Your existing happy customers are your best resource for new business. When they refer a colleague or friend to your organization, they are warming up the lead -- likely with 2/3 of those prospects agreeing to buy.
If you don't have a proactive referral process in place, ask yourself why. Are you concerned that asking puts you in a desperate position or makes you seem pushy? Repeat after me, "I am very good at what I do, and I can help people my happy client cares about. So I will ask these people because I was put on this earth to make a difference."
If you don't believe that's true, change professions. If you do believe, what are you waiting for? Successful people are not afraid to promote their value to others.
The best time to ask for a referral is right after getting an "atta-boy" -- when a customer expresses gratitude for a service you've performed. This works because of the reciprocity rule -- our internal conditioning to return the favor when someone does something for us.
When asking for a referral, first identify what value has been received. "I'm always curious to find out what has been most valuable for you in working with our firm." Reaffirm that feedback: "That's great to hear. Our mission is to help as many business owners in situations like yours as we can."
Next, set up "the ask," ensuring your customer doesn't feel pressured. "I am sure there are people you know who would find similar value in working with our firm. I am also guessing you don't talk about your (insert business category) needs at dinner parties, and so someone may not come immediately to mind."
Then make the direct ask: "What I've found is that the people I can help the most are... Who do you know that might fit that profile?" Then brainstorm about companies that you're interested in and the relationships they have.
Contrast this thoughtful approach to the typical, "do you know of anyone" method, which usually nets a response of "I can't think of anyone."
Referral generation often produces the highest return on investment of all of your sales and marketing strategies. If you're not already asking, it's time to shift your thinking and leverage this golden opportunity.
Lori Turner-Wilson is an award-winning columnist and CEO/Founder of RedRover Sales & Marketing in Memphis, TN. www.redrovercompany.com. You can follow RedRover on Twitter (@redrovercompany and @loriturner) and Facebook (facebook.com/redrovercompany).
Lori spent over 15 years leading corporate marketing and communications divisions in the financial services, hospitality and franchise restaurant sectors. As Director of Target Marketing for the Hampton Hotels brand of Hilton Hotels Corporation, Lori managed promotional, direct and Web marketing, as well as custom publishing, for the brand's franchise system. In her role as Vice President of Employee Communications and Development for First Horizon National Corporation, she managed the corporation's internal culture initiatives, communications, and employee recognition programs. Other positions held include Sr. Communications Director/Corporate Editor for TCBY Enterprises, Inc., and Vice President of Marketing for First National Banking Company. Lori is a founding sponsor and member of the Board of Directors for LaunchMemphis -- an organization committed to developing an entrepreneurial community in Memphis comprised of investors, entrepreneurs and local organizations. In addition, Lori is on the Board of Directors of the Sales and Marketing Society of the Mid-South and on the Advisory Board for the Humane Society of Memphis and Shelby County. She is a sought-after speaker in the Memphis area, delivering sales and marketing keynote addresses and workshops to organizations like: the Memphis Chapter of the American Advertising Federation, the Sales & Marketing Society of the Mid-South, LaunchMemphis, EmergeMemphis, the Memphis Regional Chamber, the National Association of Women Business Owners, and the Hospitality Sales and Marketing Association International. Lori holds a B.S. in Marketing from the University of Nebraska, Lincoln, in addition to having completed the University of Colorado's School of Bank Marketing and Management. She is the recipient of numerous industry awards including local and district Addy's, Communicator awards, and a Telly. She received recognition as one of the Memphis Business Journal's "Top 40 Under 40" recipients in 2009. Lori also served as a contributing ghost writer for the renowned "Complete Idiot's Guide to Guerilla Marketing." Beyond her passions for marketing and dogs of all shapes and sizes, Lori is an avid traveler, runner and foodie.
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