5 Ways to Increase Your Best Leads: Customer Referrals

It doesn’t take long to learn that your best leads are referrals from your customers. No other lead source comes close.

When one of your clients refers you, they’re usually doing it because there’s a real opportunity there. Also, their colleague’s company is usually similar to theirs –similar size, culture, and usually needs the same type of solution.

Now that’s targeted marketing!

When you personally plan to make a large purchase — a car for example — you may read car magazines and company brochures and talk to salespeople, but what really leads you to your ultimate choice? Often, it’s a trusted friend who owns a car you’re considering and is willing to personally vouch for it. That’s the power of referrals. They often overcome every other form of product research.

Unfortunately, referrals are hard to scale, unlike the leads that we get from prospecting and content marketing. As marketers, we wish we could simply move our marketing budget into referral-generating campaigns, but it doesn’t work that way. Still, there are few ways to double or triple your incoming referrals.

My top five ideas for increasing referrals:

1. Ask for them … especially at the right times

Happy clients love to give referrals, but don’t always remember you when the time is right. That’s why you should let them know how important they are and show appreciation on an ongoing basis. 

It’s also important to figure out when are the best times to ask for referrals. In my experience, it’s:

• after they respond positively to an NPS (Net Promoter Score) survey
• right after the sale
• right after a successful implementation or service delivery
• around a year after implementation, when all the bugs are worked out

A large company I do business with built their marketing program almost entirely around generating referrals. Every email that they send to customers ends with, “Who is the one person you know that could benefit from my advice and expertise?”

You can re-purpose this message for your customers and make it a part of your salespeople’s standard email signature.

2. Incent your salespeople (and customer success managers) to ask for referral

Your salespeople almost certainly know it’s important to ask for referrals all the time. But are they actually doing it? Most salespeople tell me they either forget or are too uncomfortable asking. Help them develop the habit so it becomes second nature.

One company I worked with incented its sales teams to ask for referrals on every single call. Salespeople kept a log of referrals they obtained from their happy clients and were then compensated with bonuses. Not only did the company triple their number of referrals, but customers seemed to appreciate being asked. Some remarked, “I’m glad you asked that. I’ve been meaning to tell a co-worker to take one of your courses.”

3. Buy one, get one free

Buy one get one at half price” is a common marketing promotion in many industries, since it works so well. In service industries, such as training, what you’re really asking for is a client referral.

When a customer registers for a class or eLearning, make it worth their while to encourage a colleague to do the same. Offer a discount on the current product or a future product as an incentive. If they can’t think of anyone else who could benefit from your training, remind them to consider other departments in their company or their vendors, partners, or clients that want a reward. Everyone wins from this. Your client gets a discount and you get a new customer.

4. Increase the purchasing power of your customer

One company I worked with met with each of their major customers annually to present a thorough report of what the customer purchased over the year and then asked what their goals were for the upcoming year. In each of these meetings, we encouraged referrals because it would increase their discount and their purchasing power, giving them more attractive pricing.

We told the customer that if we could get one more department in their organization to spend the same amount as they did, then we would give their company a major price break. Often, this led to deep discussions about the company’s org chart and some clients even went as far as to give us an org chart and a phone list!

5. Satisfy your customers

I once read a study that found that satisfied customers tell one person about their experience with a company, while unsatisfied customers tell five.

There’s a lot of power in referrals, for good and for bad. Obviously you want your advocates to outnumber those who are saying bad things. This is obvious, but it’s amazing how easy it is to forget, especially with those who aren’t on the front lines, listening to customer complaints.

Early in my marketing career, I thought most of our new customers came my carefully orchestrated marketing campaigns. Over the years, I dug a little deeper and found a large percentage of customers who came out of nowhere.

Where did they all come from? It wasn’t from our salespeople. Marketing didn’t do anything to get them. So, what happened? After talking to hundreds of customers, I finally concluded that more came from referrals than from any other source, including marketing and sales.

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If you don’t currently include referral-generation in your marketing plan, the time to start is now. If you already have a plan for generating referrals, the ideas above should help you freshen up your approach.

If you enjoyed this post, check out our eBook 10 Marketing Strategies That No Learning Tech Vendor Can Live Without.

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About Gordon L. Johnson

I’ve been a marketing leader in the corporate L&D industry for over fifteen years. Along the way, I’ve discovered what works — and what doesn’t. Happy to share that with you. More info at www.gordonljohnson.com.