Do You Have 30 Seconds To Maximize the Value of Referrals?
Hinge Marketing recently published results of a study that validates what experienced marketers know instinctively. The study, available for free at hingemarketing.com, examines how buyers buy accounting and financial services.
When an individual begins looking for a source (or new source) of accounting services, your first and most crucial challenge is to get on their radar screen. How can they consider you if they don’t know about you or your firm?
What’s the best way to get on their radar? What we know intuitively, and what the Hinge study put in concrete terms, is that the prospective buyer will, 87% of the time (!), turn to their network, friends and colleagues for referrals.
Searching online (10%), inquiring with an accounting trade association (5%) or reviewing related business publications (4%) almost don’t count when compared to the value of obtaining a referral.
Satisfied clients are actually quite generous when it comes to providing referrals. The study found that 76% are likely to provide a recommendation. Why such a high percentage? For one thing, if they are happy with you and your services, it is a feather in their cap – and a point of pride – to be able to refer you when someone asks them for a recommendation.
Further, a similar percentage – 75% – say they have made referrals in the past; not necessarily related to accounting services, but to movies, restaurants, car dealers, etc.
So, if people are not only willing to refer, but actually do refer, why don’t you get more referrals from your clients?
It turns out that most people (52%) wait to be asked, e.g. “What did you think about the new James Bond movie,” or, more to the subject at hand, “I can’t stand my accountant; do you know someone?” On the flip side, about 45% proactively offered a referral.
What can you do to reach the people who might refer you?
For the roughly half of the people who proactively offer referrals, you can reach out to them via personal contact (client meetings, professional groups, service organizations, etc.), as well as blogging, speaking, writing, social networks, etc. Engage in these behaviors in those arenas where relevant conversations are occurring and if you sufficiently impress enough of these individuals, some proactive referrals will emerge.
For the other half – those people waiting to be asked – what’s your action plan? No mystery here: you should ask them. This is how you maximize your referral opportunities. But, will you ask? And, if you do, will the request be effective?
If I may take a moment and offer the benefit of my experience, I am aware that many of you find it very difficult to ask a client for referrals. If your reluctance is high you will either not ask, or you run the risk of asking so self-consciously that the conversation is both ineffective and awkward.
Never fear … there is a way to ask that has a wholly different dynamic; one where you don’t approach as a supplicant, but instead from much more solid psychological ground.
It is indisputable that we all (including your clients and contacts) want to be associated with winners. Take advantage of this desire and consider the following requests for referrals:
“Jan, you know a lot of professional people and I want to ask a favor. My practice has been growing rapidly and I’m going to be adding additional staff. This means that for the first time in many months I will have band width for some new clients. I’d like to have a backlog of work for the incoming people, so if you have occasion to refer any of your contacts to me, I’d really appreciate it.”
What is Jan hearing as you speak? First some flattery (you know a lot of …), then that you’re successful (you’ve been growing …), then that you’re even more successful than she first realized (fully booked; no room for more clients), then that you are specifically asking her for referrals from within her contacts (more flattery; she knows the kind of people you covet as clients). You’ve asked from a position of strength; not weakness. Jan knows it reflects well on her if she’s associated with a winner. The odds are favorable she will refer you with enthusiasm.
Contrast the foregoing with: “Jan, this economy has been tough on everyone and I confess I would like to find some more revenue. You’ve been a client for years and I hope you believe my work is first rate. If you happen to run across anyone who might be looking for a new provider of accounting services, I’d appreciate a referral.”
Which of the two foregoing will Jan find more compelling? Exactly.
You’ll be having a number of tax season conversations with your clients. It is a perfect opportunity to take an extra 30 seconds and ask for referrals.
How can you craft your request so your client (or other contact) feels they are helping a winner succeed to an even greater degree? This is the key to maximizing the value referrals can bring to your practice.
If you have a technique to ask for referrals that has been successful, I’d like to hear about it and pass it on to other readers. Give me a shout.