Referrals and Leads: How to Give, Get and Use Them
This blog post was written by Ray Sidney-Smith, owner of W3Consulting and facilitator of the monthly Alexandria SBDC Small Business Roundtable.
It’s become a well-regarded axiom among marketing professionals that people do business with, and refer business to, people they know, like, and trust. When you start out in business, many of the reasons why this is so aren’t readily apparent. So, you might crawl, stand then stumble, and frequently fall, before you learn walk the line of art and technical skills needed to build that professional rapport with customers and referral sources.
Referrals are the lifeblood of most small businesses. We wouldn’t exist without the support of our local communities talking up (or down) about our businesses. So, as expected on such an important topic, September’s Business Development Roundtable had a packed room and much to be said about the art and style of referrals and leads. Here are some of the highlights.
We kicked things off with making sure we were all on the same page regarding what exactly referrals and leads are. Referrals can be separated into those made by a customer to a potential customer about your business and those given and received regularly between referral partners. The customer referral comes because the customer had a great or long-lasting positive experience with you, your staff, product, or service. Referral partners involve a trusted product or service provider that will handle the needs of a fellow professionals’ network.
At some point in every business owner’s life, they receive a lead, or research and find a lead. This is simply when someone tells you about someone else that they think should use your services, or buy your products, or when you find such a person or company that would be a good potential customer. There is no hand-off of a relationship (or, what psychologists call “social proof”) from the referral source to you.
Leads from Your Website
One interesting discussion thread that came up was about leads that come in from websites. Some Roundtable participants were pretty critical of website contact forms as a lead generation tool, while others considered it a worthwhile profit generator when paired with effective Google AdWords campaigns. Either way you look at it, most people that reach out to your business through the website contact form are going to be pure leads. They have found your information through blog posts, online advertising, or other forms of marketing or advertising efforts. You need to be aware of this as you build out any lead or referral generation program for your business.
A technique I have found works for my small business clients is to set up different forms for different audiences. If you are developing a cohesive lead generation blog strategy, tie those blog links to your contact form from each blog category. You do this to separate contact forms with questions specific to those coming to your blog about those categories. The more tailored your form, the more likely the blog reader will feel that you’re speaking directly to him or her, the more unique information you’ll be able to garner from the blog visitor, and that will lead you closer to sales.
No matter what you do in terms of lead or referral generation, you need to work to get information to and from all parties efficiently, and make sure that you’re able to update them and be responsive to their needs and wants. The website technique above is just one example where technology can be really useful, but it can be a totally offline or paper-and-pen system for tracking and maintaining who you’re helping, how and keeping everyone abreast of the status of deliverables.
Handling Referrals with Care
When it comes to referrals there was a great deal of conversation about how to make sure that you handled referrals with care. This is an extremely important point to underscore. These people have come to you with the equity of someone else’s reputation and you really want to make sure they come away with an experience that meets or exceeds their expectations.
As noted above, Roundtable participants had two categories of referrers of business: those coming from colleagues and those coming from other customers. It’s important to consider how (and if you can for confidentiality and legal reasons) to update or reward those referrers for sending your business referrals. I recommend that you figure out a plan for how you acknowledge and recognize referrers, and how you’ll update them about the success of your referrals. People feel good when they hear their referral was successful, and that motivates them to send you more referrals. This increases their social equity with the people they refer to your business.
So, make sure to know whether you’re running a referral or lead generation strategy for your business. Then, create a cohesive referral or lead generation strategy that actually helps you and your customer get to know and work well with each other. And, finally, treat all parties well and they will reward you with more referrals!