| New studies demonstrate the benefits of | | | | Steps to Create Your Referral Marketing Plan |
| referral marketing. In his book The New Art | | | | |
| and Science of Referral Marketing, Scott | | | | A Key Component |
| Degraffenreid explains how the science of | | | | |
| social network analysis has been used to help | | | | Your services or products must be top notch. |
| companies effectively utilize referral | | | | In today's competitive marketplace, simply |
| marketing. | | | | meeting your clients' expectations isn't |
| | | | enough. Aim to exceed expectations -- |
| Recent advances in mathematics made possible | | | | underpromise and overdeliver. |
| by new computer technology now enable experts | | | | |
| to precisely quantify the impact of | | | | Remember: the person referring you is putting |
| referrals. In his book, Degraffenreid | | | | his or her reputation is on the line. They |
| describes a research study on physicians' | | | | must have confidence in you! |
| referral patterns for a pharmaceutical | | | | |
| company. In this example, millions of dollars | | | | Who will refer you? |
| had been spent marketing certain drugs, with | | | | |
| very slow market penetration due to few peer | | | | • Happy, satisfied clients who already |
| endorsements, while others with minimal | | | | know, understand and appreciate what you |
| marketing exposure sold well because of high | | | | offer. |
| referral incidence, making them far more | | | | |
| profitable. By testing behaviors in several | | | | • Businesses that sell to the same |
| different ways, results showed that the | | | | target market. |
| primary reason we make referrals is to | | | | |
| enhance our standing with the people we | | | | • Friends and family are often eager to |
| refer. We want to look good! | | | | help. If someone asks what he or she can do |
| | | | to help your business, don't waste the |
| He explains that because we're bombarded | | | | opportunity. Be ready to tell them how. |
| daily with so many marketing messages, our | | | | |
| brains have developed methods to filter these | | | | Ask for referrals! If you don't ask, people |
| out. This, combined with rising costs, makes | | | | may assume that you have all the clients you |
| 'traditional media' a less effective way to | | | | can handle. |
| communicate your message. People are the new | | | | |
| media! Referral marketing is a viable, | | | | Make a list of those you can ask for |
| cost-effective alternative. | | | | referrals, and keep in touch with them |
| | | | regularly to maintain top-of-the-mind |
| The Benefits of Referral Marketing | | | | awareness. |
| | | | |
| • Consumers today have developed | | | | Make it Easy to Refer Your Services or |
| cynicism and distrust of advertising | | | | Products |
| messages. When considering a purchase, we're | | | | |
| now much more likely to ask a trusted friend | | | | Educate and equip potential referrers with |
| or acquaintance for a recommendation. | | | | the tools they need. Keep it clear and |
| | | | simple. If telling someone about your |
| • We listen to those we know and trust. | | | | services seems complicated, and there is a |
| When a friend of theirs has referred a | | | | possibility they might appear foolish, they |
| potential client to you, a level of | | | | probably won't refer you. |
| credibility and trust has already been | | | | |
| established. They are more open to hear what | | | | Be crystal clear about: |
| you have to say. | | | | |
| | | | • Who your "ideal client" is |
| • Most likely, the person referring | | | | |
| someone has already described your service or | | | | • The benefits and value of your |
| product and you need to spend less time and | | | | product or service |
| energy educating them on the value you offer. | | | | |
| These leads generally turn into sales much | | | | • How to contact you |
| more quickly. | | | | |
| | | | Follow up on referrals promptly, expressing |
| • Referral marketing is more | | | | your sincere thanks. If appropriate, include |
| profitable. To generate a steady stream of | | | | a gift as a token of appreciation. Always |
| referrals will take effort but may cost | | | | keep your referrer in the loop. Let him or |
| little or nothing at all. | | | | her know what's happening, even if it's |
| | | | nothing and you're still playing phone tag. |
| When a company's printed materials, website | | | | |
| and signage send a consistent message with | | | | Create a form to track referral leads and |
| similar text, graphics and colors, it conveys | | | | measure the results and corresponding costs. |
| a solid, professional image. It provides the | | | | |
| level of comfort a potential client may need | | | | It takes time and thought to actively seek |
| to do business with that company. Check to | | | | out and educate potential referrers, to help |
| see if you are communicating a mixed or | | | | them look good by referring you, but the |
| confusing message that might undermine your | | | | results can prove well worth the effort. Put |
| credibility and professionalism. Perhaps use | | | | your plan in place now, follow it faithfully |
| a focus group to give you objective feedback. | | | | and take advantage of this profitable |
| | | | marketing method! |