I love providing value to others. It’s in the name of our organization: (Values-Driven Leadership).
Few things put a smile on my face more than believing I had the chance to give value to another person.
That smile only grows when I find a kindred spirit.
Bill came on the Lead to Grow podcast to deliver a few secrets on customer referrals. The biggest one is this: They aren’t a side dish to your business. Referrals are your business.
Check out what Bill said about exponentially growing your business through referrals:
Why the Ultimate Question Isn’t “Will You Recommend us?”
You’ve heard this touted as the ultimate question: “How likely is it that you would recommend (this product, service, company) to a colleague or friend?”
Bill says that’s a great concept, and has some truth. But it’s not the ultimate question. He says the ultimate question is whether or not a customer is recommending your business.
That verb makes all the difference.
The point isn’t whether or not they’re willing to recommend you; it’s all about whether or not they are recommending you.
Referrals Are the Keys That Unlock Exponential Growth
Personal, relationship-based referrals are the lifeblood of any business. Studies have shown that when asked, almost everyone prefers to learn about a business through word-of-mouth.
People trust their friends.
These referrals are the difference between incremental growth based on a great product and exponential growth based on a great product multiplied by a growing fanbase.
When everyone’s talking about you, your business grows dramatically and rapidly.
There Is Actually a Low Correlation Between Satisfied Customers & Referrals
This statement may be somewhat of a leap for a business leader, but Bill coupled it with a very compelling statistic:
Only 20% of extremely satisfied customers actually refer a business, product, or service.
So, if it’s not satisfaction, then what’s the crucial key that creates referrals?
There are two crucial points here:
- Engagement. The people who give referrals and recommendations are clients (or customers) who are engaged, those who understand and appreciate the value you bring.
- Connection: The other compelling issue is how connected an individual feels to a brand. Perhaps a brand and a customer support the same non-profit or social issues, for example.
Bill says it this way: “You've probably heard that ‘all things being equal, people do business with those they like.’ Well, the truth is, all things being unequal, people still do business with those they like.”
Creating a Culture of Referrals
Creating a business built on referrals is a true commitment from any business.
The leaders (and the entire company) must adopt the philosophy that referrals aren’t the icing on the cake. Referrals are the cake.
So how does a company shape an entire organization that is centered on customer referrals?
- All in. Be bold that this is what our company will be all about.
- All hands on deck. Everybody in the company plays a role in this culture.
- Onboarding. When customers come into your company, onboard them with continual value (education, service, etc.), and engage that personality from day one.
- Leverage. If you followed the first three, you hopefully have a growing fanbase who is connected and engaged, so what is your strategy to leverage that trust? Will you put a reward or referral system in place? Will you create an ambassador program?
Non-Front-Facing Employees: What Is Their Role in Increasing Referrals?
You may be wondering how to get buy-in from the entire company on becoming a referral-based business- especially with back-office personnel, and in business-to-business companies.
Here’s one consideration: overall ambassadorship. Employees don’t just talk about their job when they’re at work. When employees are all-in on the business, they become ambassadors wherever they go, at coffee shops, in schools, churches, etc.
An interesting note from my own experience: Before I sold my company, we went through a period of extreme growth. This was mostly the product of an intentional cultural shift that affected the entire DNA of the company.
One of the greatest benefits was the high-caliber individuals who increasingly wanted to be part of our team. As our culture had positively shifted, our employees became total fans of our company and started pulling in their closest friends and family to come work for us.
These were vetted, high-quality, individuals who were excited to be part of a rich culture. You can’t pay for that type of referral.
If You Were Having Lunch With Someone, What Would You Want Them to Walk Away With Knowing About You?
I ask it to everyone. Bill said this:
He wants to give value to every person he talks with, whether by a compelling thought or idea, or by the simple act of listening.
He sure gave us a lot of value on our podcast!