Here is three mistakes that business owners make regarding referral systems:

1. They don’t have a referral program
2. They asked for the referral to early in the relationship
3. They stopped asking for the referrals

The 3 Biggest Mistakes About Referral Programs

The three biggest mistakes business owners make about referral programs are:

1. Don’t have a referral program in place
2. Asked for the referral too soon
3. Stopped asking for the referral

Referral Mistake Number 1:

1. Your business doesn’t have a referral program in place

The closing ratio on a referred customer or client is much higher than someone that responded to a classified ad, yellow page ad, direct mail piece, telesales, or most other forms of advertising. The person referred comes into your place of business trusting you already. A satisfied customer or happy client has already sold this new prospect on you and your business, your credibility has been built for you.

So why don’t you have a referral program in place?

Referral Mistake Number 2:

2. You asked for the referral too soon in your relationship

You don’t ask a woman to marry you on the first date so don’t ask for a referral on your first encounter. You have to date her for a while and show her you care about her. You must show the woman your dating that you will go out of your way for her that she is important to you. You have to show this beautiful woman that when she is with you her life is improved and she benefits form the relationship.

How does dating translate into you getting a referral from your customer or client. Once your client or customer has realized that their life is improved by the relationship and they have received a good, big or huge benefit from you, your product or service they will become raving fans and will tell you.

Here is an example:
Client said: “ I woke up this morning and my back wasn’t sore it was awesome”

Or you can walk them through the benefits you have provided from them.
i.e.
You: “Mr. Jones remember six months ago when you came in here all bent over with restricted motion?”

Client said: “life sucked back then”

You: “how long did it take us before you could touch your toes?”

Client said: “five or six weeks”

You: “how long did it take us to get you back on the tennis court?”

Client said: “I think about 3 months, I’m really enjoying being back on the court with my buddies”

You get the idea we walked Mr. Jones through the benefits of the service that was provided for him, I was painting a picture in the customers’ mind of where he was and what benefits were provided to him from using my service.

Do you think that Mr. Jones saw those pictures in his mind?
Do you think he realized the benefit he got from our service?
Do you think that if I now asked him for a referral he’d be more inclined to say yes?

Referral Mistake Number 3:

3. Stopped asking for the referral
This mistake is the big referral program killer. Marketing educated business owners know that the best way to grow their business for the most part is setting up multiple referral systems and tracking them. However; once a few customers or clients say ‘NO’ or make lame excuses for now wanting to give a referral most business owners become embarrassed and jaded over the whole referral marketing strategy and believe it just doesn’t work.

Don’t blame the strategy, asking for referrals is a great marketing strategy and an cheap way to grow your bottom line. It is almost always the poor implementation of when and how the referral was asked for that is the problem.

So don’t throw the baby out with the bath water, just understand that asking for referrals is a marketing strategy and like any strategy it has to be thought out and worked on a little to iron out the bugs. If you are not running multiple referral programs then examine the reason why and identify your referral mistakes, then get back to asking for business from your happy clients or customers.

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