Referral network refers to a group of business owners and professionals who try to promote each other to gain more leads and sales. It’s a highly effective strategy for building business because it’s based on trust. Here’s why it works:
- 92% of people in business trust referrals from people they know
- 87% of front line sales reps, 82% of sales leaders and 78% of marketers agree that referrals are the best leads you can get
- 86% of companies with a formalized referral program have increased revenues over the past 2 years (Source: Digital Intelligence Today)
What’s the best way to create one? Here are 4 best practices for building a referral network with an infographic.
- CONNECT WITH PEOPLE RELATED TO YOUR INDUSTRY: The first step to building a referral network is to dedicate time to meeting people in and outside your industry. To determine who this should be, ask yourself: What sort of products or services would your customers benefit from the most? Who are the best people to provide those products or services? Who are the best local providers for such products or services? What value can you provide for their customers?
- SEGMENT YOUR REFERRAL NETWORK: Evaluate connections and divide them into three segments: 1) Those most likely to need what you offer, 2) Related businesses in the same industry or who have the same Buyer Persona and 3) Totally unrelated businesses but important to your customers.
- HAVE A CHECKLIST FOR GIVING REFERRAL: When you give a referral to your one of your customers, base it on the following considerations: 1) RELEVANCE: Make sure a referral you give is relevant to their situation, 2) QUALITY: Refer only those who deliver on what they promise and 3) AUTHENTICITY: Avoid overrating a referral and keep your customer’s need the priority.
- MAXIMIZE VALUE OF YOUR REFERRAL NETWORK: Building the referral network is half the work. You need to learn how to use the network so you and your connections can mutually benefit from the gains of each other. Consider: 1) Collaborating with people in your network on an assignment, 2) Use their products or services and 3) Offer them an incentive to use you on one of their assignment.
If most sales and marketing professional rate a referral network as their most effecting business building asset, why wouldn’t you have one?
Below is the infographic from Business Coaches Sydney on building a referral network for your business.
Do these best practices help you in creating one?
About the Author, Garret Norris: For over 15 years Garret has been one of Australia’s leading Corporate Sales, Management Training and Coaching organisations. Garret has been improving the performances of business Managers, Leaders and Sales Teams. Garret simply gets results!