03.29.20165 min read

How to Ask for Referrals without Getting Rejected

Asking a customer for a referral is the business equivalent of asking someone out on a date. It’s high risk, high reward. It’s a little awkward. And it involves two possible answers: yes or no.

The thought of hearing “no” inhibits some business owners and sales teams from asking in the first place. Even worse than the feeling of rejection is the possibility of further alienating a customer who was already dissatisfied with your business. 

But by not asking for referrals, businesses are leaving opportunities on the table. Most customers won’t naturally give referrals, even if they’re happy, research suggests. In a study by Advisor Impact, Charles Schwab, and Texas Tech University, 93 percent of customers said they’d likely continue working with their financial advisor. But despite their satisfaction, only 29 percent had actually given a referral in the past 12 months. 

To get referrals, you have to ask for them. But to prevent getting rejected, you have to ask the right way. We talked to two businesses that rarely hear “no” when they ask for referrals—and have grown substantially as a result. Here’s a look at how they do it. 

They don’t ask every customer for a referral

Referrals are a main source of new business for King LASIK, a group of laser-eye surgery centers in the Pacific Northwest and Canada, and Keeping Current Matters, a Long Island-based subscription service that provides educational content and resources to real estate professionals. 

More than a third of Keeping Current Matters free trials, which precede a paid subscription, originate from referrals. King LASIK, meanwhile, thrives on online reviews: The company attributes a 28 percent annual revenue increase to its glowing reviews on sites like Facebook and Google+. 

One secret to their success: Both companies don’t ask every customer to give a referral or write an online review—only those they already know are happy with their services. 

To identify referral-ready customers, the companies use Infusionsoft to send a series of automated emails, the first of which is a survey. Only if the customers rate the company highly do they receive another email asking for the referral or the review.

Dissatisfied customers receive different emails in which the company asks how their experience could be improved. For King LASIK, the email offers an opportunity to offer better customer service—while also ensuring unhappy customers aren’t being asked to voice their opinions online, said Michael King, vice president of marketing and operations. 

“You could figure out how to get 40 percent more reviews,” he said. “But if you’re still giving a bad service, you’re just amplifying a problem.” 

They ask customers to help other people, not the company

Customers won’t necessarily give referrals to help your company make more money. But they might be inspired to help other people like them.

King LASIK’s request for reviews and referrals speak to helping friends and family members get optimal results from eye surgery. In asking for a referral, Keeping Current Matters asks customers to spread the company’s mission: “to change the way real estate professionals educate and serve their clients.”

Keeping Current Matters CEO Bill Harney says the message of a better-informed community resonates with real estate agents. “The more educated we can make the entire industry, the better it is for every consumer and every agent,” he said. “There’s plenty of business out there to go around. It’s about how can they get a bigger piece of the pie, and if transactions go more smoothly, they can do more transactions.” 

They incentivize customers to take action

In giving a referral, customers may want to help your company and help other people, but they also want to help themselves. In a survey by the consultancy Software Advice, 39 percent of people said a financial incentive would make them “much more likely” to refer someone to a brand they love.

Both King LASIK and Keeping Current Matters use rewards to show their appreciation for customers who give referrals. For King LASIK, the incentives grow over time: The company offers a $50 gift card for the first referral, $100 for a second, and a pair of Maui Jim sunglasses for the third.

Keeping Current Matters members receive a free month of membership for every customer who joins using the member’s referral link. Saving the monthly fee of $19.95 is enough to motivate referrals, Harney has found: Some members have given so many referrals that they won’t be billed again until 2018 or 2019. 

To read more about King LASIK, Keeping Current Matters and strategies for earning referrals, check out our free e-book, “Referential Treatment: How to Ask for Referrals that Help Grow Your Business.” 

 

 

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