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I was talking with a fellow business owner recently, and I asked her how things were going at her co-working space. As she explained the energy of the place and the various entrepreneurs she’d run into. She said, “Hey, you know who you should meet…” and began to describe someone she thought would benefit from my services.
Referrals like this make up about a third of our business at Reconciled. As a small business owner, I’m always balancing the time and energy spent providing stellar service to my existing clients while focusing enough resources on bringing in my next client. The process to grow your business is easier with referrals.
With referred customers, I avoid some of the hurdles I’d have to overcome with a cold outreach or an online visit. These potential customers already have confidence in our value. Why? Because someone they trust told them we’re trustworthy. So once we connect, they’re just wondering how to sign up and what the agreement structure looks like.
Creating Referral Partners
Of course, one of the best ways to grow your business with referrals is to do excellent work and be a good member of the communities you’re part of, whether they’re local or digital. But even if you’re providing great service to your customers and being kind to those you engage with, getting referrals doesn’t always happen organically.
Because I know the value of referred customers, I’m intentional about developing referral partners. Many of these are businesses that I can create a reciprocal relationship with: I think you provide a great service, so I’ll refer to you. You think I provide a great service, so you’ll refer to me. As an online bookkeeping company, my referral partners are generally accounting firms or banks, but partners don’t have to be in the same industry.
How do you grow your business using a referral partner? You ask.
Sit down and make a list of people you have strong relationships with. Not just family and friends but peers. People you’ve worked for, people who’ve helped you in the past. Let them know what you’re trying to do. Paint them the picture and ask them to be part of your team – because that’s what a referral partner is. They’re not on your staff, but they’re an essential part of helping you create a successful business.
If there’s a bank or accounting firm I don’t already have a relationship with, I’ll ask them to coffee or lunch to begin to build rapport. Of course, I’m interested in having them as a source of referrals, but I also genuinely care that they exist in the marketplace and are contributing to the success of our community.
Maintaining Referral Partners
Of course, once you’ve created the relationship, you have to maintain it.
I keep my referral partners updated on how we’re doing as a company by sending emails or newsletters and getting together for informal meetings. Also, and this is a big one, I solicit their advice.
I believe everyone has something to teach me, so I’ll ask them: Here’s what I’m doing – what do you think about that plan? How are you approaching your market? Are there ways you’re reaching clients that I should copy?
It’s a great way to learn from other business owners, especially if you’re a new entrepreneur. But it also feels good to the person you’re talking to. Most people love being asked for their advice, especially if the question is coming from someone they see as a fellow expert in their field, not from a client.
Once I have a partner that refers work to me regularly, I make sure to show them my continued appreciation. I provide a portion of the revenue from the referred client if the partner can receive that. Accounting firms, banks, and attorneys do not receive incentives. If I can’t share revenue, I’ll send a handwritten card or a small gift. And each year during the holidays, I send out a small gift to all my referral partners. I send it to let them know how much I value our relationship.
Getting Client Referrals
Client referrals are more often the result of providing excellent service to clients than about building specific relationships. My clients are all busy people who are focused on running their businesses – and on building their own referral networks. So I don’t spend a lot of time trying to cultivate separate referral partnerships with them.
But I do let them know that I appreciate referrals. Once a year, I send a direct message to all my LinkedIn contacts. Many of whom are current or former clients. I ask them whether there’s a service or product I could offer that would help them, or whether they know of a business owner who could benefit from my services. I find that LinkedIn works well for this because the question is less likely to get lost in an overflowing email inbox.
When you grow your business by utilizing a referral pipeline it can feel very calculating. That feeling dissipates when you come at it from a place of humility. There are dozens – probably hundreds – of businesses in your community that have something to offer you. Learn from them and let them know that you can use their help.
Referrals are only one piece of any customer acquisition plan, but they’re an important part. Without them, you may be missing out on a great source of customers – and some meaningful relationships.
The post From the CEO: How to Grow Your Business Using Referrals appeared first on Reconciled.
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