Referral Best Practices

Which referral processes and activities have been shown in practice to be the most effective?

Originally Posted by AZBroker Which referral processes and activities have been shown in practice to be the most effective?

Team buy-in has to be on the list. For maximum participation the team has to believe in the referral program.

I've had the pleasure of interviewing and working with dozens of the top producers in the country in various fields--various financial services, real estate, mortgage, consulting, accounting, legal, and many others--to find out how these folks who really do make a million dollars or more a year generate their huge volume of highly qualified referrals.

Basically, they don't do things the way most salespeople do (which isn't surprising). And they certainly don't do the traditional "do a good job and ask for referrals" that most salespeople do.

Here is a quickie process they go through--obviously, all the details aren't here, but the basic process is:

Whether their prospect has been referred or not, within 10 seconds of meeting them for the first time they let them know they are referral-based. Then they remind the prospect consistently that they are referral-based.

Once the prospect has become a client they let the client know they expect referrals, how many they expect, exactly what a good referral for them is, and exactly how they are going to earn the referrals (they give the client an objective way to determine whether or not they've earned the referrals); and they find out exactly what the client expects to happen during the sale--and then they do exactly that.

During the remainder of the sales process until the sale is completed, they work diligently to give the client the exact purchasing experience they want.

Once the sale has been completed they have another meeting with the client to gather the referrals. At that meeting they find out exactly what the client's relationship with the referred prospect is. Also, they have done some homework prior to that meeting and have made a list of people they know they want to be referred to that they have reason to believe the client may know.

They then make sure that they contact the referred prospect in the most advantageous way to ensure getting the appointment (which is not by picking up the phone and calling the prospect--that's one of the worst things to do).

This may sound like a long, detailed process and it may also sound a bit "in your face" with a client. It is actually neither. The working with the client is never "in your face," confrontational or demanding. And the process itself typically takes no more than an extra hour or so in the sales process (assuming you're in a sales cycle that takes some time to complete--if you're in a short sales cycle, the process takes a little less time, including the referral acquisition meeting after the sale). The above outline may not make a lot of sense without the details of how to do it, but that would be--well, a book.

None of the top producers I met with do exactly the same process as any other top producer or even every step I just mentioned. I've simply taken the best practices they use and systematized them. But all of them, virtually without fail, let prospects know upfront that they work off referrals, at some point in the process they let clients know they expect referrals, they have a separate meeting to get referrals, and above all they find out exactly what the client wants to happen during the sale and that's exactly what they give them.

How do they let people know they are referral based? Do they just say, "I work by refferal"? How do they convey that they expect referrals?

Yes, they say something to that effect. If it is a referred prospect, they re-emphasize the fact they are referral-based; if it isn't a referred prospect, they make their introduction fit the occasion. Something like this if they meet someone at a networking event that could be a prospect: "Joe, I typically only work with clients that have been referred to me, but based on our conversation I think I might have some ideas that could help you . . ."

As far as letting them know they expect referrals, while the prospect is still a prospect, they mention the fact, casually, in passing, that they are referral-based every chance they get. Prospects aren't stupid. If they realize referrals are important to you and that you've built your business on referrals, they'll put two and two together and figure out you're going to be asking for referrals.

After the prospect becomes a client, they have a much more direct conversation about referrals and the client's expectations during the course of the sale and exactly how they will earn the referrals.

Originally Posted by pmccord But all of them, virtually without fail, let prospects know upfront that they work off referrals, at some point in the process they let clients know they expect referrals, they have a separate meeting to get referrals, and above all they find out exactly what the client wants to happen during the sale and that's exactly what they give them.

This is excellent information. Thank you Paul.