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Why You Should Be Asking Your Customers for Referrals

Why You Should Be Asking Your Customers for Referrals

I have said this time and time again: you must ask for referrals if you want to grow your business. Referrals can contribute to a larger percentage of your revenue if done correctly. In fact, approximately 50 percent of my revenue is generated from referrals. Without them, I would be stuck putting in countless hours online trying to drum up fresh leads.

Referrals are easier to generate than you may think. The hardest part is getting up the courage to ask. Some people think they will offend customers by asking for more business. In reality, your customers will be more than happy to send people your way if they are satisfied with your work. As such, it is important that you develop a good relationship with your clients and develop a plan to seek referral business from each and every one of them.

If you are not yet sold on asking for referral business, here are a few facts that will hopefully convince you:

  • Referrals don’t cost anything.
  • People always know someone who can benefit from your services.
  • Your customers are better at marketing than you.
  • Referrals can lead to more referrals.

Referrals don’t cost anything

When it comes to marketing, it is important that you allocate funds to the right marketing channels in order to get the most return for your investment. One good thing about referrals is that they are a form of marketing that costs you nothing but could pay off big in the end. A referral is free and it only takes a second to ask for one. If people do not refer others to you, then you wasted nothing but a few seconds of your time. If they do decide to refer customers, you gain a 100 percent return on your investment.

People always know someone who can benefit from your services

This is one of the truest statements about referrals. Everyone has a network of contacts and it is likely that every one of your customers knows someone to refer to you. Even if it is not friends or family, they know a co-worker or a neighbour who could benefit from your service. If you ask for a referral, they are likely to tell that person about you. But if you fail to ask for the referral, they are unlikely to even think about you when someone brings up services that you offer.

Your customers are better at marketing than you

Well, maybe not better at marketing, but people are likely to believe testimonials over your sales pitch. This means that potential customers are more willing to believe their friends who have already used your service. People who are referred to you are more likely to go with your service simply because you were recommended, and spend less time scoping out your competition.

Referrals can lead to more referrals

Kind of like compound interest, referrals become more rewarding when they turn into referrals themselves. Again, everyone knows someone who can benefit from your services. Continue to multiply your referrals and you will eventually have an endless stream of customers, all of whom can lead to additional referrals.

By Mike Wood

 

 

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