B2B sales reps spend a lot of their time creating new opportunities. Some are fortunate enough to have a steady stream of inbound leads, while others must rely on their cold outreach strategy and their grit to keep their pipelines full. One valuable yet underutilized technique for creating sales opportunities is referrals. Referrals are a great way to generate new business, although most salespeople don’t use them.
There are two primary reasons salespeople don't have success with referrals. The first is that many salespeople find it awkward to ask a client to provide them with a name and a warm intro. The second reason is that they don't ask for the referral at the right time. We will correct both of these roadblocks and provide you with an effective strategy and to massively improve your ability to acquire a referral.
The Value of a Referral
There is nothing better than a client introducing you to someone they know, and testifying on your behalf that you can provide them with the outcome they need. After all, a satisfied client is proof that you’ve delivered. Referrals are powerful because the person providing the introduction wouldn't recommend you or your company if they weren't pleased with your results.
The referral is important, even if the person you are being referred to may not yet have a need. Because this is often the case, when working with a referral, you want to use a sales strategy that leads to a new opportunity for you and better results for them.
Why Salespeople Don't Ask for Referrals
Consider the following scenario: A salesperson brings on a new client and flawlessly executes, and their contact is pleased with the results. As time passes, the salesperson has moved on to other deals and hasn't communicated with the contact in six months. This puts them in an awkward position because they don't feel they can ask their contact to help them with a warm introduction.
Even though you are supposed to believe that relationships no longer matter in sales, they are important and build trust. To build a referral strategy that works, you need to maintain your relationships. Like every relationship you have, this requires time and energy. The strategy that follows will improve your ability to acquire referrals.
When Do You Ask for a Referral?
The reason salespeople struggle when asking for referrals is, in part, a matter of timing. Most don't recognize when to ask for referrals because the time comes earlier than they expect. If you wait too long to ask for the introduction, it feels weird to ask because too much time has passed since you created value for your client. This is the reason most salespeople don't like asking for an introduction. In fact, asking for a referral is about as popular as cold calling.
When building a referral strategy, the time to ask your client for a warm introduction is when they sign the contract and improve their results. This strategy relies on the language you use and the timing. As your client is signing your sales contract, you say, "When I produce the results we’re going to deliver, if everything is perfect, can I ask you for an introduction to someone in your network who might need help with the same results?"
The referral is contingent upon your ability to deliver the results. Your new client isn't obligated to provide an introduction should you fail to produce the better outcomes they need. It's an easy ask, and an easy yes from your client.
How to Prepare to Ask for a Referral
When you and your company are executing and producing results, you call your client and update them on your progress. You also verify they are pleased with your results. Any time you reach a milestone, follow up with your contact. Without persistent communication, you won't feel you deserve the introduction to a potential client.
Once your client has the better results they need and can describe the difference you have made for them, you have met the criteria you set in the contingent agreement you and your contact made. At that time, they committed to introducing you to someone, provided you delivered the results you promised. A happy customer is what you need to acquire a referred customer. You now have one. And, thanks to your ongoing communication, it won’t be awkward to call your contact and ask.
Asking For a Referral
Asking for a referral is best done in a meeting. It should also be part of your sales process. Start by asking if your contact is happy with the results you provided. When they confirm that they are, say, "The best business for me comes from referrals. Can I ask you to provide me with a referral and an introduction to someone who might need the same results we provided you? I would to ask them to meet with me for 20 minutes, and it would be helpful if you could let them know that I won't waste their time."
Your client may be worried you will become a pushy salesperson, causing them to regret making the introduction. They may also want to ensure you provide the same results, as they don't want to be embarrassed. You might offer a risk reversal by saying, "I am not going to hound the person, and if we do any business together, I will keep you updated on how we are doing with them."
Start Your Referral Program
Referrals are a powerful tool for salespeople because they come from trusted sources. A referral is an introduction from someone your prospective customer knows, trusts, and respects. This reduces the risk of the customer making a bad decision and increases the likelihood of a successful sale. Additionally, referrals are more likely to convert than cold leads, as the customer already has a positive opinion of you and your company. A successful referral program can help increase sales, build relationships, and grow your business.
Creating a successful referral program requires salespeople to take the time to build relationships with their customers and build trust. Ask for a referral when the customer is happy with the results you have delivered and don’t wait too long after the contract has been signed. Be prepared to provide the same level of service to the referred customer as the customer making the introduction. Finally, it is important to offer a risk reversal to reduce your customer's apprehension about making the introduction. By using these strategies, you can create powerful referral programs that will help you increase your sales results and hit your sales targets.