How to Create A Strong Referral Stream For Your Business
Sharon: Good morning, everyone. This is Sharon Heller, and I'm here today with Steven Kohnke from Denver Business Coach. Good morning, Steven.
Steven: Good morning, Sharon. How are you today?
Sharon: I'm good. I'm looking forward to our conversation this morning. What's our topic today?
Steven: Yeah, awesome. So, at Denver Business Coach, we've been doing some qualitative research and asking business owners where they're showing up in their business, where their strengths or their weaknesses. One of the questions on there, was specifically referring to referral streams, are they strong or are they weak within their business? Are they getting any business from direct referrals? And that's what we're talking about today.
Sharon: Awesome. Well, let's start with you describing what is a strong referral system and why is it so critical?
Steven: Yeah, they're very critical. And first, I want to distinguish between two different types of referral streams here. One is really going to be referrals generated by past or current customers. And the other one is going to be referrals generated by a strategic partner. So business partners that you meet and network with and focus on the same areas of interest.
Steven: Today, we'll be discussing more about the past customer, and past clients, or current clients' referrals. A strong referral system is really when a past customer, or past client, or current customer, current client, absolutely just loves what you have to offer, sees huge value in it, and wants to go out and tell all their friends and family about it. This is what we call promoters of a business.
Steven: And this is actually referring to a pretty common evaluation tool or metric that many businesses use called the Net Promoter Score. This really takes the temperature of whether or not you have promoters or detractors or neutral people, that you've been working with. And the goal is to have as many promoters that you've worked with, in the past or you're currently working with, and that is how you start to build a strong referral stream.
Sharon: So important and you know, Steven, it seems like business owners can sometimes be shy and kind of hesitant to ask their clients and customers for those referrals. What would you say to those business owners?
Steven: Yeah, absolutely. That's it's more of a common thing than you would think among many business owners, small business owners. A lot of business owners will say to themselves, "if my customer wants to refer me, they will. If they're enjoying what I have to offer them, they will refer me". And this is actually, most of the time, not true.
Steven: If you put yourself in their shoes, they're not necessarily thinking about how to grow your business for you. They're just happy to be getting the benefit of what you're able to provide for themselves. They leave your office or they experience your service, and yeah great that was awesome, and unless someone is directly asking them, who did this? Or who do you see for that? Then it's not going to click. It's not going to work for them.
Steven: So really, if you're not asking and you're too shy to be asking, they're not really thinking about it. So how to overcome something like this, is just make it a part of your system. Make it a part of your business. This is how we do business is every once in a while we will ask our customers to be thinking about us in that way, so that we can help benefit more people the same way that they have, or your business has benefited them.
Sharon: Really important tips, any closing comments before we wrap up today?
Steven: Yeah, having a referral stream is very important for any business. It's the word of mouth marketing that everyone seeks. It's essentially free marketing. So to have a real strategy for it is very important. And it's not enough to just kind of leave it up to your customers to do it for you. So if you have any questions or want to learn more about how to develop your own strategy, just visit us at DenverBusinessCoach.com, and myself or one of our other coaches on staff will be able to help you sort some of those questions out.
Sharon: Great. Thank you, Steven. Wonderful talking to you today.
Steven: Thanks, Sharon. Pleasure.