• Seeking the Holy Grail of Sales: Referrals

    It is a known fact that a sales lead resulting from a referral from one of your customers is one of the best leads you can get, and usually these have a very high close rate. The dilemma: how do you get more?

    Many organizations rely almost exclusively on their sales teams or employees to solicit referrals from customers, partners, and affiliates. The most common technique is for managers to continually ask their salespeople to “get more referrals.” This usually results in a short-term push by the sales team to ask their current customers and prospects “Who do you know that could use our products/services?”

    Frequently with very lukewarm results!  The response they usually get is something like “I can’t think of anyone right now, but if I do, I will certainly send them your way.” If your sales team is diligent in this effort, they typically will go through their customer list once, but rarely continue to follow up again during subsequent calls. So the initiative delivers a very low response rate, and the sales team returns  to prospecting using traditional methods without finding any new leads from your customers.

    How often does your company go through this cycle? Sound too familiar?

    Instead of placing the burden on your sales team to ask for the “Holy Grail” of sales leads, consider creating a programmatic approach to gather referrals from satisfied customers, partners, and others. These people would usually be happy to recommend your products and services to others, but they can’t think of anyone when your sales team asks them, and then they don’t think about it after the initial request was made.

    Many organizations are successfully finding the “Holy Grail” by creating referral programs that reward customers, employees, partners, and others when they send a sales lead to you. The most successful programs are those that implement some form of incentive to the person sending the referral, either when a lead is submitted or when it is closed. This could be in the form of cash, debit cards, points, or another form of compensation.

    To be successful, these programs can’t be a one-time event, but rather an ongoing program backed by marketing, communication, and, preferably, some form of electronic submission, such as a website, so your customers can easily send these referrals to you when they come across them. Using a website to submit and track the referrals allows you to continue to communicate to the people who sent you these leads to keep them up to date on the progress of their lead, send reminders about the program to keep it in the front of their mind, and, more importantly, to tell them that a sale closed so they know that they will be receiving the incentive for sending the referral.

    A final word of caution, don’t expect a huge wave of leads when the program is launched. It will take time for the program to grow, and for people to participate and send leads. It is not their job to promote your business or products, but it is human nature to help others. So when they do come across someone who can benefit from your products or services they will likely tell them about it, especially if there is something in it for them! Then the leads will start to come, and you can start to reap the benefits of finding this “Holy Grail.”

    Michael Browning is Regional Business Manager for CCI: Channel Management Solutions. Since joining the company in 1998 as co-owner, Debra has been a strong leader and a critical factor in the company’s growth and success.  To view all company blogs go to CCI’s blog site.

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