Published by MPA:
Referrals, referrals, referrals. We all want them, we all get them, but very few brokers truly harness the power of client referrals through an on-going strategic plan designed to maximise their referrals.
Notice the key word ‘strategic’, because let’s get one thing clear right off the bat: simply providing great client service, handing out a few business cards and then sitting back hoping for referrals is not enough. This approach will get some referrals, but by implementing a strategic referral plan a broker can typically double or triple referral numbers virtually overnight.
So what should you consider when preparing your referral plan? There are five key pillars to maximise referrals.
1. The ‘wow’ factor
Making your clients go “wow” should be no accident. If you want your clients to talk to others about your business, you need a strategic plan designed to create a “wow” experience every single time.
Here are a couple of tips on creating the “wow” experience:
• Set expectations with your clients upfront, and then plan to over-deliver in terms of service, value and results. To really “wow” your clients, you need to do more than what they expect. Provide more service, get the results they want faster, and give unexpected value to make them feel special.
• Be different and unique – people don’t talk about boring! You need to give your clients a big reason to talk about you. You wouldn’t rave to your friends about a new Baker’s Delight that just opened up around the corner (they are everywhere and standard), but you’d rave about a new European-style bakery that has 100 different desserts on offer – because it’s different, unique and worth talking about.
2. Don’t scare off your clients
People are protective of their friends, family and colleagues. Knowing this, we need to approach referrals in what I call a ‘non-threatening’ way, to make our clients feel comfortable with referring others.
A non-threatening referral process does not start with contacting a referred person to book an appointment. If you go for the appointment too soon in the referral process, this may put them in a position where they feel threatened. Your clients will not refer if they think their family or friends are going to feel awkward, obliged, or like they are being “sold to”.
The way to approach “non-threatening” referrals is to give your clients the comfort of knowing that when they make a referral, there will be absolutely no sales pressure at any stage. So instead of calling a referral directly to book an appointment, you want to ensure the referral has the power to choose to contact or not contact you to proceed. The best way to go about this is to start by offering to send your client’s referrals an information pack – that tells them all about what you do, how you can help and how they can take the next step. If they choose to take action and call you, that’s their decision.
The other benefit to using a non-threatening approach is that most clients think they should only refer their friends or family to you when they need immediate help. So, for example, you might receive a referral from a client because their friend is buying a new house, or is actively looking to refinance. If you only capture these “as needed” referrals, you are missing out on many other potential referrals that might need your help, but are not actively looking or talking to their friends about it. With a non-threatening referral process, you collect as many referrals as possible, send out information packs, and then when those referrals need help – you’ll be there.
3. Make it easy
Many of your clients are no doubt very happy to refer their friends and family to you, however they have a lot on their minds and a lot to do, so thinking about referring people to you is low on their list of priorities. That’s why we need to do everything we can to make the referral process for our clients very simple, fast and easy to do.
Simply handing out five business cards to each client and asking them to give them to friends and family will not work – because they have to remember to take the cards with them and they don’t know how to bring the topic up, so they’ll most likely get stuffed in a drawer or put in the bin!
On the other hand, if we asked our clients who they know who would also benefit from our services, then simply asked them to open their phone and write down the name, email and postal address of three of their friends or family – this is very easy for them to do.
4. Provide three types of incentives
I’ve studied marketing and human behaviour for the past 10 years and it’s a fact that the majority of people are motivated (at least on some level) by what’s in it for them as opposed to what’s in it for others. I’m not saying that people are selfish, just motivated by self-interest.
Let me explain with a quick example: a new café opens in your neighbourhood. You visit one day and discover they make the best coffee in town. Instantly you want to tell your friends about it, tweet about it, Facebook it, email the details around. Why? Is it because you want your friends to enjoy the best coffee in town? No. Although this is the reason most people will confess to, it is almost always the secondary reason. The primary reason you instantly want to tell everyone about this new café is because you want to be the one who told them about it, so in future when they visit the café and love it – you receive the praise for referring them to that café. Therefore, you are more motivated to tell your friends because of what’s in it for you (praise) compared with what’s in it for them (great coffee)!
You should use this self-interest to encourage referrals – and the best way to achieve this is through incentives. There are three main types of incentives: value-based incentives, gratitude-based incentives and winning-based incentives. All of these should all be used as part of your strategic referral plan:
In exchange for referrals, you offer gifts, vouchers, fee rebates, donations to charity or suchlike to motivate clients. You can offer rewards only when a referral becomes a client – or you can offer rewards simply for making the referral, regardless of whether the referral results in a deal or not. Everybody likes to be rewarded for their efforts, so value-based incentives are indispensable.
A simple thank-you is priceless and cannot be forgotten as an important recognition many clients appreciate. Receiving a thank-you call or card in the mail from your business after making a referral will reinforce the desired ‘referral behaviour’ you want to encourage. Also, when your clients’ referrals thank them for referring them to your business, this also reinforces a positive experience.
You want to create a belief within your community of clients that making referrals is the right thing to do, because it results in rewards, praise and community acknowledgement.
When you create a referral culture in your business, your clients will go out of their way to refer more and more in an effort to be publically rewarded. Having a regular ‘Referrer of the Month’, for example, is a great way of encouraging your clients to compete with each other for not only prizes but the reward of being publicly acknowledged, say in your monthly newsletter.
So do competitions and giveaways work in driving referrals? The answer is a firm yes; however to enjoy huge success with competitions or giveaways you must have the five pillars in place, as well as solid marketing and communication skills to ensure your clients stop and take notice.
5. Never stop asking.
Asking for referrals once is not the way to maximise your referrals. There are many touch points, milestones and opportunities throughout the relationship with your client to directly ask for or prompt referrals.
At the initial appointment, loan approval, settlement, annual review, monthly newsletters, through social networking and client-only events – these are all great opportunities to extract referrals. Just because a client does not refer the first time, doesn’t mean you shouldn’t remind them over time to refer when they are ready, or when one of their friends or family needs help. Similarly, if a client has already referred they are likely to refer again and again – so your simple reminders can strategically extract more referrals.
Remember there is no “right time” to ask for referrals. The right time is any time!