The Boomerang Effect

The Boomerang Effectstring(20) "The Boomerang Effect"

The foundation of building a successful word-of-mouth-based business involves giving referrals to others as well as connecting people so that they may increase their business.

If you know how to give good business referrals to others, and consistently make beneficial introductions to connect people to each other, you will enjoy the Boomerang Effect. The Boomerang Effect is having a referral that you gave out to someone else come back to you in the form of new business.

In the early years of BNI®  I received a referral from someone in Los Angeles to whom I had sent business in the past. That referral became my client and they referred three more people from all over the U.S. who did business with me, too. That particular boomerang kept coming back again and again.

Actively Listen for Good Referrals

To consistently give good business referrals to others you must become a good listener. Throughout your day, actively listen for people to express a need that is represented by someone in your personal network of contacts. Remember, a good networker has two ears and one mouth, and uses them proportionately.

Listen to what people have to say, especially when they share their frustration about a problem that needs solved. “My computer is SO slow!” “I need more vehicles for the company fleet.”  “Our office printer just quit working.” “We’re waiting for the insurance company to return my call – from 2 days ago!” Then refer them to a trusted member of your networking group who can provide the solution to their needs.

A Referral Is an Opportunity

Keep in mind that a referral is not a guaranteed sale. When you give a referral to your networking partner, it is an opportunity for them to talk with someone who is in the market to buy or use a particular product or service. You can view referrals as either hot, warm, or tepid.

Hot Referral – this is someone actively looking for a service or product right now who is personally introduced by you to your referral partner. You told the prospect about your business friend, how good they are at what they do, and shared your confidence about their professional ability to help them with their needs. They are ready to set an appointment or have a call as soon as possible.

Warm Referral – this is someone who has been shopping around and is willing to talk with another provider of that product or service. You have taken the time to give them some background information about your referral partner and perhaps told them a testimonial about someone in a similar situation that they previously helped. You offered to make an introduction and asked when they want your business friend to contact them.

Tepid Referral – this is someone who expresses an interest or wants to talk to someone in a certain profession, however they are not in the market to proceed at this moment. You told them you know a professional who will be glad to answer their questions and provide information to help them. You gave them your business contact’s name and phone number and asked if they would like to receive a call from them.

Sometimes a referral that you give to someone else boomerangs as new business for you. It may take days, weeks or even months to return to you, and it may be from someone else rather than coming directly from the person you gave the
original referral to. However, that IS the philosophy of Givers Gain® and it is based on the age-old concept of “what goes around comes around”.

Have you experienced the Boomerang Effect in your business? I invite you to share in the comments below.

5 Pointers on Giving Referralsstring(30) "5 Pointers on Giving Referrals"

Since business referrals are the principal tools and the valued currency of networking, you should make sure that yours are both timely and appropriate.  Here are five important points to consider in giving a good referral:

 

1. Listen for needs from the people you meet.  When you meet someone who expresses a need, tell her you know a person whose business can provide the product or service she’s looking for.  Tell her about your business experience, if any, with that person.  Give her the business card of the person you’re referring, and ask for hers.

2. Ask whether it is okay for the person or business you are referring to call.  This helps determine how hot the referral is.  If she says yes, fill out a referral slip (or use the back of your card) and give it to the person you referred.

3. When giving a referral to someone, be careful not to misrepresent the quality of the referral.  Your honesty about the prospect will be appreciated, even if the referral is tepid.

4. Whenever you have a hot referral for someone, don’t hang onto it.  Call the person you’ve referred right away; hot referrals have a way of cooling off quickly.  Provide as much information as possible about the prospect, including the prospect’s name, address, phone number, occupation, and any relevant information about the product or service the prospect is looking for.

5. Avoid giving bad referrals, such as:

  • News about a meeting for business owners, a chamber mixer, or any other business meeting.  This is an announcement, and potentially good information to have, but not a referral.
  • Providing someone with a better source for obtaining products.  Again, this is good information for someone, but not a business referral.
  • Giving the same referral to three different people in the same profession.
  • Referring someone to a prospect without telling the prospect that you have done so.
  • Giving someone a referral but telling him or her not to use your name with the prospect.

These tips will certainly help you get and stay on the right track in regard to giving referrals and if you have additional referral-giving tips to share, I’d love to hear them.  Please post your tips in the comment forum below. Thanks!