How to build an active referral network

Posted by Carrie Simpson on May 18, 2016 3:52:06 PM

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referral_network.jpgMost companies have three different types of clients. First, you have The Evangelists. These clients are likely already bringing passive referrals to you. Passive referrals are fantastic. As the name indicates, a passive referral is something you don’t have to work for. Passive referrals are a gift. They’re not a reliable long-term business development strategy, though. Be very grateful for these referrals, but don’t plan your retirement on them. Evangelists are outlier clients. They are naturally vocal, and when they’re happy they’ll sing your praises to anyone who will listen.

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Second, you have The Already Gones. These clients are the exact opposite of The Evangelists. They’re displeased, they’re telling you constantly how unhappy they are, and nothing you can do will fix it. You should release these clients back to industry. These are the clients that are leaving one-star Yelp reviews and complaining about you at networking events. Get out elegantly and quickly. They’re leaving you, so make it easy for them to do so. 

The third type of client is what we at Managed Sales Pros call The Danger Zones. These are the clients you might pay less attention to because they aren’t as vocal as your outliers. We’re all guilty of this. These clients may be happy, or they may not be, but they consist of the types of companies that won’t actively complain. They’ll just quietly wait out their agreement and leave you when your competitors come knocking.

Reach out to your Evangelists

With this in mind, your first step in developing an active referral network is determining whether your clients are loving you or leaving you. To create a rock-solid referral network, you need a client roster that truly believes you are the best choice of provider. So before you begin asking for referrals, ask for feedback. Make sure your clients are genuinely delighted with the service they’re receiving from you.

The easiest way to determine their level of satisfaction is to ask them. How often are you checking in with your clients? Statistics show that only one out of every 26 people will proactively voice their displeasure with a supplier. The last thing in the world you want to do is ask a client who is unhappy with you to refer you their peers. So unless your client is an obvious Evangelist, don’t ask them for referrals. 

MSP's Guide to Cold Calling

Start the referral process with your vocal and loyal Evangelists first. This will be an easy place to begin, especially if they’ve already brought you referrals. First, ask your Evangelist clients for a testimonial. Make it easy for them—write one for them! You know what problems you’ve solved for them. Take your amazing client to lunch, share the testimonial you’ve written, and ask them if you can use it as is or if they’d like to edit it. Ask them under what circumstances you can use it. Can you share it with prospects? Can you post it on your website? Use it in a mailer? Get permission for any of the ways you’d like to use it. If they’re happy with what you’ve written, it’s time to move on to the next step.   

Carrie_quote.jpgDo your research first

Prior to lunch, you should spend time reviewing your client’s LinkedIn profile. Who are they connected to that you’d like to do business with? Make a list. Bring this list with you. Once you’ve secured your great testimonial, pull out your list and let your client know that there are six/10/12 people they’re connected to that you’d really like to be doing business with. Ask them for their permission to use their name and the testimonial when you contact these people. Better yet, ask them to help you connect with them. Remember, the easier you make this, the more inclined people will be to assist you, so do most of the legwork before your meeting. 

Let’s assume that your client is okay with you contacting everyone on the list. Now you get to work. Call your new prospects. Don’t approach your first interaction as a sales call. You’ve been introduced by a mutual acquaintance. Take an opportunity to make a new friend before you make a new sale. This new contact may have a need for your service, or they may not. They can still be an important part of your new referral network.

Imagine right now that from here on in you will ask every person you meet who they might know that could benefit from working with you. Imagine every happy client you have providing you with the names of 10 people they know and trust, and that each of those 10 people gives you 10 more names. Your cold calls just became a lot warmer. 

Return the favor

The biggest thing to remember when it comes to building a referral network is reciprocity. Referrals should, of course, be given to the people who are giving them to you, so you must be an active participant in this new process. Consider asking one last question every time you talk to someone. “What is the biggest challenge you’re facing in your business today? What would help you the most?” Then, using your amazing new connections, help them find the person they need to be speaking to in order to get that problem solved. Everyone benefits. This means taking sales calls, by the way, so don’t start asking people to introduce you to their colleagues and partners and friends if you’re not prepared to also be introduced from time to time!

I’m going to be sharing more details on how to build an active referral network on my webinar with Intronis on Wednesday, June 15 at 2 p.m. ET. I hope you’ll join us!

Webinar: Proactive Referral-Based Prospecting Strategies for MSPs

carrie_simpson_august2014_(3).jpgAbout the Author: Carrie Simpson is the founder of Managed Sales Pros, a lead generation firm dedicated to providing new business opportunities for MSPs. Carrie teaches IT firms how to build, manage, and grow their sales pipelines. You can follow Carrie on Twitter @sales_pros and connect with her on LinkedIn

Photo Credit: Sombilon Photography via Flickr.com. Used under CC 2.0 License.

Topics: Sales Process

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