by Grady Kerr
If you do not ask customers for referrals, you are leaving money on the table. If you’re asking for referrals, but aren’t automating this important task, you are probably still leaving money on the table. Automating this process can ensure you never let a possible referral fall through the cracks.
When I work with a new Infusionsoft customer, we do a deep dive into their current sales and marketing processes. There are two questions I ask that often elicits the same reply:
“Where do most of your leads come from?”
“Great, how many of those referrals did you ask for?”
When it comes to lead sources, customer referrals are one of the most profitable areas to invest. These leads convert higher, buy more, and retain better. Nielsen reported that 84 percent of consumers trust recommendations from friends and family. That trust translates to a customer who is 18 percent more loyal than a customer acquired through a different method, spends 13.2 percent more than a non-referred customer and has a 16 percent higher lifetime value, according to the Journal of Marketing.
Knowing all the benefits of customer referrals, why do most businesses treat this as an afterthought? Typically it is because once we get our payment from the customer and deliver our product, we consider the transaction over. However, even though the transaction is over, we still need to maintain our relationship.
How to get referrals
Amid the customer lifecycle is a lot of emphasis on attracting new leads and selling to them. Wowing those new customers is just as essential. The easiest way to determine who your happy customers are is simply to ask them, and automating a post-sale survey is a great way to accomplish that. There are many questions you can ask on a survey: You can ask if they liked your product, if they got their order on time, and if the service was satisfactory. These all provide helpful data, but at the end of the day there is one question that lets you know how pleased they really are with your company: “How willing are you to recommend us?”
When I had my window cleaning company, every customer was asked this one critical question. In order to automate this process, I limited my response options. Many use a 1-10 Net Promoter Score system, but I kept it simple with three responses: “Very Likely to Recommend,” Somewhat Likely to Recommend,” or “Not Likely to Recommend.” If someone selects the latter two options, I automated an email to be sent and have a task created to find out what went wrong. If they indicate they were “Very Likely to Recommend,” I would send them to the next stage of the referral process. These are the customers we wanted to ask for referrals because they like us and trust us. Then we needed to determine what we do with that trust. Once I got a customer to this point, I used a drip campaign to ask them to do three key things: share a review online, then provide a testimonial, then a referral.
After the customer indicates they are likely to recommend you on the survey, send an email asking them to elaborate on why they are likely to recommend. What problem did they have and how did you solve it in a way that wowed them? Not only does this solidify their own high impression of your service, it gives you a great snippet to use in future marketing.
Seven days later, ask your happy customer to share their positive experience online. This could be a Facebook Page, a Yelp listing, a LinkedIn Profile, or anywhere else where your company has a presence on the Internet. These are great places to direct your customers to so they can share their story. Eighty-eight percent of people trust online consumer reviews as much as they trust recommendations from personal contacts.
A word of caution when asking customers to leave a review online for you: Make sure you are only sending a request to happy customers. The last thing you want to do is send a dissatisfied customer to Yelp with an axe to grind. That one negative review can haunt you for years.
Lastly, wait another week or so to ask your happy customer who else you can help. (Not who else you can sell to). Don’t ask them for friends who have money burning a hole in their pocket, but for friends who have the same pain points they had, which are the pain points your business is equipped to solve for.
The key to getting your customers to respond is to make it as easy and automated as possible. Create a lead capture form that allows them to click and add their referral. You can also create a lead capture campaign just for referrals so that all the customer has to do is share a link. And if these are things you are already doing, it might be time to upgrade to a Referral Program.
What to do with our referrals
A customer referral is a sign of trust. They trust you with their reputation, because if you fail to deliver on expectations, it is their reputation on the line as much as yours. Even if your referral does not buy, the level of care and gratitude you display toward the referral will solidify your relationship with your referring customer and keep them sending more referrals your way.
Grady Kerr has been in training and development for nearly 10 years. Seven of that was spent managing his own small business. He currently uses that expertise in coaching new Infusionsoft clients in strategizing and getting started in the software.