Referral marketing is considered to be one of the most cost-effective and trusted ways to win new business. It’s the simple process of gaining a network of individuals who understand and trust your company enough to refer you to their networks if the need for your service or product should arise. If you asked B2B businesses how they win most of their new business, the majority will likely say ‘by referral’.
So, the focus of any successful referral marketing strategy should revolve around building your network to generate referrals. But how do you ensure that you choose the right network and the right people who will become your business advocates? A referral marketing strategy takes time and hard work but can be incredibly rewarding.
Your networking strategy needs to be well thought out and planned, not a random mix of networking events and group memberships. By carefully selecting particular groups that are both relevant and active and identifying the events that will provide good opportunities for you to meet the right people, your networking becomes strategic and both time and cost-effective.
Who to target.
It’s crucial that your network of referral sources are carefully selected. They need to be individuals who network and have strong relationships with key people and businesses that you consider good prospects. As a referral marketer you are constantly building and expanding your networks, seeking good referral sources and, of course, identifying new referral business opportunities for your business and your referral network members.
How to build a referral network.
Once you have identified the key individuals to boost your business the next step is to build strong relationships with them. The best and most effective way of doing this is through a constant and regular programme of contact and communication. It’s really about having a common understanding of the philosophy of ‘what goes around comes around’ – by offering or giving business referrals, you can then ask for them in return.
Think of your network as your own personal ‘unpaid’ sales team, who know your business almost as well as you do and vice versa.
If you successfully develop strong relationships, your referral sources will be proactive and will actually invest time on your behalf to seek out and identify opportunities … and why would they do that? Well, because they know that you do the same for them.
A referral marketing strategy takes time and hard work but can be incredibly rewarding. It should form an integral part of your marketing and business development activities – and if implemented successfully creating a steady stream of new business opportunities will seem effortless.