True or False?–Your Best Source of Referrals Is Your Customers
Do you believe your best source of referrals is your customers? If so, think again . . . the reason people sometimes fall into believing customers are there best source of referrals is that they’ve been trained to believe it and have never pursued any other source of referrals. The only referrals they’ve ever received are from customers.
Don’t get me wrong–customers and clients can be a very good source of referrals and I’m not denying that. However, many businesses (especially big corporations) are out of touch with the fact that other referral sources are available that can be extraordinarily powerful. Clients, although often the most readily available sources, are not necessarily the best or steadiest sources of high-quality referrals. The best sources in the long run are likely to be the people you refer business to. When you help another businessperson build his or her business, you’re cultivating a long-term relationship with someone who’s motivated to return the favor by bringing business to you, who’s sharing your target market, and who will work systematically with you for mutual benefit.
With a well-developed referral network, you can realize more good referrals from one or two professional referral sources than from all your customers combined. Why? Because these professionals are better salespeople than your clients and they spend more time in contact with your target market. They know how to sell to your client base. They talk your talk. If you’ve done your job of educating and training them to refer business to you, they can communicate your value better to their contacts.
There’s also a built-in challenge with viewing customers as referral sources. If you’re spending part of your time with a customer trying to get referrals, you’re generating a conflict of interest. Instead of devoting all of your time and attention to the customer’s needs, you’re diverting part of that effort toward your own self-interest. Instead of devoting all your time and attention to the customer’s needs, you’re diverting part of that effort toward your own self-interest. The customer may sense that they are not getting full value–and the truth is, they may be right. You may be sending mixed messages. You may be polluting customer service time with “gimme business” time.
Yes . . . you can expect to get referrals from a happy customer, but you’d better make darn sure the customer is indeed happy. This means keeping your attention–and your motivations–focused on the customer’s needs when that is the purpose of the visit or call. However, there’s nothing wrong with asking for another appointment specifically so you and your client can discuss how you can help each other.
What’s the best referral you’ve gotten recently (think about the referral you’ve been the most excited about)? Where did that referral come from? I’d really like for you to share your answer in the comment forum below because I’d love to get a conversation going about the diverse array of avenues from which good referrals can be generated. My goal in writing this post was not at all to discount customer referrals, but rather to emphasize that they are not solely the best source of referrals–great referrals can come from many places. For that reason, I’d love to hear where your most recent standout referral came from so please share your story with us–I know more people in addition to me would really like to hear about your experience!
11 thoughts on “True or False?–Your Best Source of Referrals Is Your Customers”
This is absolutely true!
Your best referral sources “should be” those businesses or people that are already selling to your target market and have a captive audience that trusts their recommendations.
Some of the best referral systems I’ve ever developed are business to business, not business to customer.
Just think of who logically sells to your target market and develop a reciprocal referral relationship. You’ll get more high quality referrals from THAT relationship than your best customers combined.
I agree, but does this not fall in the category of Joint Venture marketing?
Thanks for a wonderful insight. I was thinking of speaking to my clients for seeking references. But after reading the blog, i am rethinking on the same
As much as I would like to provide a “counter point” to make the conversation more lively, I admittedly can’t think of a better referral in the past 6 months than those I’ve received from referral marketing techniques, whether through visibility that comes from multiple chamber events or through the concentrated, methodical approach I take within my involvement with BNI.
I would say that my best referrals came from BNI members. I have been in BNI for three years and have discovered that there is no better place to receive them from.
I have been an active member of BNI for 3 years during which time I have received a 30% increase in clients due to tier 1 and 2 referrals. For me as a Wellness Coach my best referrals are happy clients. Thank you.
Great and enlightening article. I sell energy efficient windows and not every member is my chapter is in the market for windows. I have been in BNI for 8 months and I am looking forward to the Tier 2 referrals. As of today, most of my referrals are from customers, but as my visibility increases, so will my credibility and lastly my profitability. I am in BNI for the long haul and I have passed 2 times as many referrals as I have received, so it is a matter of time and I will see more Tier 2 referrals. I am very patient and, Lord willing, I have lots of time. Thank you for your insight! Socorro Alaniz
In practice, I’ve found it to be 50/50. During 2012, 50% of my business came from client referrals, 40% from BNI relationships and 10% “all other”. This year, it’s 40%/40%/20%, respectively. But I’m spending a disproportionate share of my time on my customers rather than BNI relationships. Dollar-for-dollar, then, BNI relationships are more profitable for me. Good article and on the money — plus a good reminder for me.
Until becoming involved with BNI 90% of my business referrals came from happy customers. In the flooring industry there are a lot of people installing that shouldn’t be/don’t know how. This makes people nervous when considering new floors, and having one of their friends tell them what a good job we did puts them at ease. I always believed that was the best way to get referrals until I joined BNI and discovered other members of my group are not only willing to give the same sort of reassurances to prospective referrals once they know me, but they are more motivated to do so. A customer may rave about my work because they appreciated it, a BNI member raves about my work because he really wants to see me get the job.