referral marketing plan Archives - Dr. Ivan Misner®

The Importance of Knowing Your Products and Services

When your referral marketing plan is working well, prospective customers buy from you the first time because they have been referred by your sources. They may continue to buy from you because they trust you and develop a good relationship with you.  But whatever the reasons they come and whatever the reasons they stay, they are your customers primarily because they need your products and services.

A clear idea of your range of products and services is something your sources need to communicate to prospects. For each product or service you plan to market during your referral marketing campaign, you must be able to articulate for your sources the answers to the following questions:

  • What is the purpose of your product or service?–What needs does it satisfy?
  • How would you describe it?–What are its shape, size, functions, key features, principal activities, benefits?
  • How is your product or service delivered to the customer?
  • How much does it cost and under what conditions?

There are other questions concerning your products or services that you should answer for your own strategic purposes. Is your product becoming obsolete?  Is there a newer or better way to provide the same service?  What are the social and environmental effects of your product or service?  Will economic or regulatory trends force you to change your products or services or the conditions under which you provide them?  In the long term, will you be satisfied to continue to offer these products or services?

Knowing the answers to the questions above will help you clearly communicate your products and/or services to your referral sources.  This is extremely important because only when you’re able to do this will your referral sources be able to effectively refer business to you.

What is the VCP Process?

The key concept in referral marketing is relationships. The system of information, support and referrals that you assemble will be based on your relationships with other individuals and businesses. Referral marketing works because these relationships work both ways: They benefit both parties.

A referral marketing plan involves relationships of many different kinds. Among the most important are those with your referral sources, with prospects these referral sources bring you and with customers you recruit from the prospects. These relationships don’t just spring up full-grown; they must be nurtured. As they grow, fed by mutual trust and shared benefits, they evolve through three phases: visibility, credibility and profitability. We call this evolution the VCP Process(R)

Any successful relationship, whether a personal or a business relationship, is unique to every pair of individuals, and it evolves over time. It starts out tentative, fragile, full of unfulfilled possibilities and expectations. It grows stronger with experience and familiarity. It matures into trust and commitment. The VCP Process describes the process of creation, growth and strengthening of business, professional and personal relationships; it is useful for assessing the status of a relationship and where it fits in the process of getting referrals. It can be used to nurture the growth of an effective and rewarding relationship with a prospective friend, client, co-worker, vendor, colleague or family member. When fully realized, such a relationship is mutually rewarding and, thus, self-perpetuating.

This simple concept has made a bigger difference in more people’s networking efforts than any other single idea I’ve discussed. For this reason, I’m going to devote the next few blogs I write to explaining each step of the VCP Process individually. Come back on Monday to learn why it all starts with visibility . . . I guarantee you you’ll want to read this one!

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