There is often debate as to whether it is a good idea to ask people to refer your business. Some businesses believe that if they get it right, referrals happen. Although this may be true in some cases, you may be leaving money on the table.
According to the New York Times, 65% of all new business comes from referrals. On average, two-thirds of consumers make purchases because someone they know recommended a particular product or service.
Let us look at some interesting facts about referrals:
Some people are nervous about asking for a referral for fear of appearing desperate. Do not fear asking. People may think your services or products are excellent. Yet, they may not think of spreading the news with others.
There are two types of referrals.
Experience-based referrals come as a direct result of someone working with your business. A previous or existing client is a prime example of an experience-based referral.
Reputation-based referrals come from people that have heard about your business. An example of a reputation-based referral is someone who has seen your advertisement or engaged with your content online.
Both types of referrals are effective ways of getting new business and growing your business. However, experience-based referrals are more powerful. Research shows that over 50% of referrals usually come from previous clients.
As part of your business growth strategy, you should put a referral strategy in place.
Start by defining your inner circle. These are the people you can approach for referrals. Then determine the strategy to approach each of these segments.
The image below is an example of an Inner-circle base.
Here are a few tips on how to get referrals into your business.
No matter how big or small your business is, you can benefit from referral marketing. Even if you are 100% confident, you offer the best customer service in your industry. You should still always have a referral strategy in place.
For specialist business growth strategies, contact Coach Sonja Shear.