Referrals Are Not Equal - Dr. Ivan Misner®

Referrals Are Not Equal

Last week I wrote a blog explaining that all referrals are not equal and that there are different levels of referrals.

The more time and effort your source puts into qualifying, educating and encouraging the prospect before you become involved, the higher the quality and level of that referral.  In level 4 through level 6 referrals, the quality of the referral is higher than level 1 through level 3 referrals.  Here’s why . . .

Level 4: General testimonial or letter of recommendation. Getting a referral source to say or write nice things about you is a major accomplishment.  His willingness to communicate positively about you and your business shows that you’ve built a moderate level of trust with him.  Of course, testimonials and letters of recommendation are fairly common in the business world, so their impact on the average person is limited.

Level 5: Letter of introduction and promotion. This is the first level of referral that truly involves a modicum of effort on the part of your referral source.  Unlike the letter of recommendation, which requires little more than a written endorsement, the note or letter of introduction implies a more substantive relationship between you and the referral source, and it usually includes background information and a description of your product or service as filtered through the lens of the author.  It also implies that the prospect will be hearing from you.

Adding the element of promotion increases the effectiveness of your referral source’s effort on your behalf.  Promotion is advocacy–an outright recommendation of your product or service with a description of its features and benefits.

Level 6: Introductory call and promotion. Another level up in terms of effort is the referral source who makes a personal phone call on your behalf.  It takes preparation and effort, but a telephone call from your source is more effective than a letter for paving your way to communicate with the prospect.  Including a promotion makes it even more favorable.

If you’re given a level 1 referral, you still have to do 95 percent of the work to close (which is not much better than a cold call) so the referral levels listed above are definitely more desirable than the referral levels I wrote about last week.  However, what you really want to get is a level 9 or 10 referral because with those, the person giving you the referral has already done most of the work for you.

Come back next week to find out the difference between referral levels 7, 8, 9 and 10–as I promised last week, this is where it gets good!

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