Title: Unleashing the Power of Referrals – **1PMP Series**
Guest: Chris Goldman
Peter: We have arrived at the final chapter of the one Page Marketing Plan. This week, I’m joined by Chris Goldman, BizMarketing’s marketing strategist and business coach. We’re going to talk about the final chapter.
Chris: Hey, Pete. Glad to be with you today to talk about chapter nine, orchestrating and stimulating referrals. So remember, this is now you’ve had people that you got to know, they became customers, you reached out to them with an effective lead, and now you’re asking, How can I leverage those customers that were happy they’re a fan base into orchestrating and stimulating referrals from them? And one of our favorite organizations that we deal with in business marketing is BNI, Business Networking International. And Pete, they teach a lot about how to do good referrals and to ask for referrals.
So talk about that experience a little bit because we know that just word-of-mouth referrals is a losing strategy according to Alan Dib.
Peter: We should clarify just a little bit. As we’ve gone through the one Page Marketing Plan book by Alan Dib, he talks about the three phases of marketing before, during, and after the phases, before they know who you are, while they know who you are, but before they purchased and then after they purchased. So we’re now in the last phase after. With respect to word-of-mouth not working, what Alan Dib is referring to is this passive approach to word-of-mouth marketing where you’re hoping that a happy customer will tell somebody else about the service that you provided them and they will then contact you for service. It’s hope.
Hope is not a plan.
Chris: That’s right.
Peter: So what he talks about is don’t sit and wait for referrals. He talks about orchestrating and stimulating referrals, a lot different verb there waiting versus orchestrating and stimulating. With respect to BNI Business Networking and International, an organization that you and I have both been members of, they talk a lot about how to ask for referrals. And one of the things that they talk about is being very specific about asking for a referral and doing it on purpose. So when I say specific, for example, it’s not just, hey, if you know somebody that needs a marketing company, let them know we exist.
It’s much more specific than that. If I said something like, Hey, if you know somebody who needs a marketing company, let them know we exist. That’s going to go in one ear and out the other.
Chris: But if we were to say, if you know somebody who needs a marketing company to specifically help them get their website to be more effective out there and help them win online. A person may say, hey, have a friend who’s really struggling with their website, and this would be perfect for us. So when we talk about this hope that we have of people kind of randomly self motivated to share, Hey, I got a company that does this, that rarely happens. And not only that, you as a person are only connected with so many people at the level that that’s going to happen with. And he talks about the rule of two fifty, which can work for you or work against you.
But when we’re talking about that, Pete, and those referrals that we’re hoping happen, that triggered something in your mind. What was it?
Peter: A couple things, Goldman. One of the things was how to ask for referrals without looking needy or desperate. Yeah. And I think the way to do that, as Alan points out, is to talk about the benefits that your business brought to the person that you’re asking for the referral. It’s a way for them to provide value or benefit to other people.
It’s not like you’re just desperately saying, I need a referral. You rephrase that, you say, Hey, you’ve seen the work we do, you know how we help businesses. If you know a business that could benefit from that, specifically a service type business, we would love to have an introduction and we have a bonus that we would give them if they identify themselves as coming from you. The other thing that I was thinking of was asking for a specific type of referral. For example, we don’t work with residential real estate agents.
We don’t work with restaurants. We don’t work with retail businesses. So one thing we could do is to be very specific. If we knew somebody in the building trades, for example, we’d say, Hey, we do a lot of work with home service contractors. Yes.
And roofing companies and plumbing companies or HVAC. If you know a business owner with one of those types of businesses, we’d love to have a conversation with them about their needs for marketing and how we might be able to help them. A lot different than just this blanket statement about a referral. That makes them think a little more specifically about who might be a good referral. And again, going back to the original point, you don’t look like you’re desperate.
Chris: Right. And you he comments about you get what you ask for. Right? And so ask for referrals and ask in such a way that they understand that they again become the hero of the story,
Peter: not you. There you go.
Chris: So he he has this great quote. This is a very simple way to remember this. He says, think back to the last time you recommended a restaurant or a movie to a friend. Were you doing so as a favor to the restaurant owner or to the movie theater chain? In all likelihood, you wanted your friend to have a great experience.
You made the referral because it made you look and feel good. And so you want to work for your customers in such a way that they feel great about recommending you. But by the way, you need to remind them in an appreciative way, I’m looking for referrals from great customers. Now another thing he brings out that’s kind of hidden in this chapter is that you tend to get back what you give out. So for example, if we have a client that’s a roofing company and people are asking us, hey, you know a good roofing company?
They say, yeah, we absolutely know a good roofing company. Call them, hey, by the way, tell them that we sent you. Next time they’re talking to one of their friends in a trade that says, hey. We’re looking for a good marketing company. Guess what they’re gonna probably do?
They’re probably gonna reciprocate. Mhmm. So you get back what you give out.
Peter: Mhmm.
Chris: Moving on in his chapters, he gets through this. He talks about not only the idea of not relying on word-of-mouth, but being more specific and not coming across as desperate or needy. But then he talks about this idea of the law of 250 and how it relates to getting ongoing stream of referral business. Pete, what is he talking about with this rule of two fifty?
Peter: He’s referring back to Joe Gerard, who was this car sales guy who sold more cars than anybody in history. He was known for sending out birthday cards and building relationships. And so two fifty refers to the number of people that would likely attend a wedding or you would invite to a wedding or would attend a funeral. He was doing some research on funerals and discovered that two fifty seems to be this magic number. So this sphere of folks that one person knows would be about two fifty people.
Something that BNI stresses, each of us individually has about two fifty people in our general sphere of influence. If you think about it in terms of each person that you interact with, there is two fifty people that they have. And if you interact with 10 people, now obviously there’s going to be some overlap in any community, but still 10 people, two fifty each,
Chris: 2,500
Peter: people you have in this sphere of influence. The potential when you start thinking about referrals, it’s not just relying on yourself. You’re using a real network effect to find new business.
Chris: And think about it relationally. We all love being networked and connected and telling people about our networks and our connections. Hey, I know a guy who has a boat that. I know a guy who owns a truck that. I know a gal who provides this service for companies.
And we love being connected and networked. And when we invite our friends and customers and fans to use their network to help our network, there’s some keys he says that are part of this. He said, first of all, you need to acknowledge them and appeal to their own ego, not in an egotistical way. Mhmm. But you wanna appeal to him is that if you make this referral for us, we want to just say thanks and appreciate you.
What’s interesting is he puts in their hands the planted idea of a discount or a bonus, not for them, but for the future customer. Right. So this is what he says. For example, you might write, Mr. Customer, it’s been a pleasure working with you.
If you know anyone in a similar situation to yourself, we’d love you to give them one of these gift cards, which entitles them to $100 off their first consultation with us. One of the reasons we’re able to keep the cost of our service down is because we get a lot of our business through referrals from people like you. So you’re not giving the current customer the $100 off. You’re giving them the power to give a future customer the $100 off. And that’s amazing.
He says, we’re not asking them for a favor, but instead, we’re offering something valuable that they can give to someone, and here’s the key, someone in their network. So they become beneficial simply by offering a discount. And then his last point here is we’re giving them a reason to give us referrals, a reason that directly benefits them. Truly powerful.
Peter: Now, one thing I’d like to step back and just point out is that we’re talking about putting a system around generating referrals. Yes. When we put systems in place, we dramatically, as, as Alan says, dramatically increase the reliability of word-of-mouth marketing. And while not everyone is going to give you a referral, many will, and it sure beats just passively hoping. So how are we going to put this into real world practice?
Chris: Yeah. So if you’re, for example, a business, let’s say you’re a dental office clinic and you’re looking for referrals, you may say, Hey, for every referral that you send us, we’re gonna give them a $15 Starbucks card, and we’re gonna give you a $15 Starbucks card. So when you’re out there and you’re talking with somebody that just moved into the neighborhood and says, hey, we’re looking for a local dentist here. What are you gonna do? Hey, I know the perfect place to go and send them there, but you’re not sending them there for the Starbucks card.
You’re sending them there because of the great service you’ve got, and the bonus is the Starbucks card.
Peter: Speaking of Starbucks cards, one of the clients that we work with, a dental practice, we came up with this idea that worked pretty well. We had some cards printed up that are plastic that look like they’re about the same size and shape as a credit card. And it had a special, a new patient offer on it for the dental practice. So if you’re a new patient, present this card and you get this bonus. What we did was we had these cards printed up on cardstock and then we glued with those little glue dots an actual Starbucks card on the inside.
Nice. And on the left fold, it said, this is for you for being our loyal patient. We’d like to give you this gift and we’d like you to give this card to somebody you know in your sphere that is looking for a new dental office. And that was pretty powerful because is actually leveraging a couple ideas here. One is this idea of reciprocity, where if you have received something first, you feel this reciprocal obligation to the person that you received that gift from.
And then now they’ve got this card. The cool thing about it was it looked like a little credit card. So, it actually had value to it. They could slip it in their wallet and give it to somebody that they knew who was looking for a dentist. When they heard that come up, they would immediately pull that out and it had the phone number on it and all the instructions on how to redeem the offer.
Chris: And if you plant a seed like, we’re offering you to give this to somebody who maybe moves into your neighborhood from out of town is looking for a dentist, what it does, it puts in their brain, I’m gonna be watching for the new people moving in. So now we’re getting very specific. It’s not just random. Right. But it plants a seed.
He says this, you need to offer a solution to a specific problem. What’s the problem? A person’s moved into a new town, into a new neighborhood. They obviously are gonna need a new dentist, a new doctor, a new lawyer, a new fill in the blank. And so you’re planting those seeds.
Peter: Right.
Chris: He says this, you have to be very specific in your request for referrals. This significantly increases the odds that it will actually happen. And so the more specificity you can give, the better it’s going to go. Moving on, he says this other thing about building referral profiles. He says, once you start answering these questions, start building referral profiles.
You can make referral marketing a deliberate systematic source of new leads rather than just something passive. So what you’re doing, what he’s getting at here, is you want to start asking some questions. The people who are likely to be our best customers referring, who do they know? What triggers will help them remember you? How will you make them look good?
How will you help them provide value to the person? So you sit down with your team, your group, and you say, we’re gonna go through these questions in the one page marketing plan and begin to build a profile, not just of our own customers, but a profile of the referrals that our customers could engage. And so you start building that. You have two profiles. Yeah.
One of your customers and one of their potential referrals that you’re looking for. And I think that’s just powerful. So you can start looking at it because everything, like you said, we’re creating a system, everything needs to be scalable, or it’s gonna be exhausting if you’re just shooting from the hip all the time.
Peter: And one thing I’d like to add is in terms of when we talk about a system, we should also have a specific number of people that we want to ask each month. If we’re going to our customers, maybe we have a specific conversation with five customers each month one So a week, if you took one client each week and had a brief conversation with them, a twenty, thirty minute conversation, and part of the conversation was asking for referral, if you think about it by the end of the year, you’ve had 50 conversations where you’re asking for referrals. That’s 50 more than you probably have right now.
Chris: He goes to become an affiliate referral partner. Now, he goes into this whole section here that I love talking about establishing these relationships that allow you to be an affiliate partner. One of his examples I love that kind of puts us in a nice bow for me is he says, let’s say that you own a pet food store, and down the street is a vet who obviously is recommending pet foods to his customers. So you go to the vet and you ask him or her, you say, what is the primary pet food that you like to recommend? Because what I’d like to do is carry that pet food and consequently give you a $50 voucher to give to your clients to say, hey.
If you go down the street to the pet food store, you can use this voucher to get a $50 credit on pet food. So he asked the question, who in this scenario wins? And the answer is everybody does.
Peter: Mhmm.
Chris: The veterinarian’s able to give a free gift to their clients. The clients are able to get pet food probably pretty close to free, 50 bag. And then the store is getting a lead and a relationship built that they otherwise probably would never have. Right. In that example, he says that on average, this pet food store can put a value to customer at about $5,000 over time.
Peter: Mhmm.
Chris: And so you’ve spent 1% to get that $5,000 of
Peter: business. Right.
Chris: Right. What an amazing exchange. So this idea of affiliating with others.
Peter: Speaking of affiliating, there’s a concept in BNI called power teams.
Chris: Yep.
Peter: And what that was were folks that were dealing with similar people or similar types of customers or customers that were in a similar life stage. For example, the real estate agent was partnered with the mortgage broker and partnered with the insurance salesperson. So you had a power team there. And in our power team, we had people who were, like for example, I had a bookkeeper, so she was dealing with other businesses because we’re business to business type sale when we sell our services. And then another one was a video person.
And we don’t, we offer video through our partners. We don’t offer video services directly. So we were able to partner and give each other referrals. And it was very productive. Especially today we are partnered with Integrity Media, Eric’s company for video, and we’ve been able to help each other in really big ways.
He’s grabbed, because of our referral to him, he’s gotten some good projects and those projects have actually helped us be better marketers because he’s providing us with the video material that we need to put into the ads that we are running. So it is really great when you can find power team or power partners to use a phrase from BNI in your referral marketing efforts.
Chris: Now all of this comes together in what he talks about your brand. And he wants to make sure that we understand the appropriate place for concentrating on brand. Mhmm. So Pete, a lot of people just start, let’s get a good brand. Why is that not the right place to start?
Peter: First of all, you have to provide a service or benefit to a customer and you have to sell it to them. And a brand is nothing more than how people feel about your company. But if you don’t have any sales and you don’t have a product, you really have nothing. Just don’t start at the brand, start at the service you provide. Now, if you have more money than you know what to do with, and we’ve seen this in the internet world, businesses will spend a whole lot of money on a brand and not focus enough on the actual product or service that they’re selling.
So you must think about sales and the, first of all, the product that you’re selling, the benefit that you’re providing, and then you have to get the word out and sell it. If you don’t have either of those, you will not have an opportunity to build a brand at all.
Chris: Thinking about brand is centered around a cool name and a great image or logo or design. And I love what he says here. He said, here’s my definition of a brand. A brand is the personality of a business. In fact, you can use the well understood word personality as a direct substitute for brand.
Mhmm. And we were talking earlier, when we do our strategy session with companies, we mainly work with companies that are already started. That’s kind of where we specialize. People who brought their business up to a great place. They know they have a great team, great product, great services.
They could do more, but they’re just not able to get over that hump. And so that’s our bread and butter for our clients. And so when we’re getting together with them in our strategy session, one of the things we spend about half that session doing is getting to understand the personality of that company. Because that really is the brand. It’s the things you stand for, the ethics that you have, the way you treat your customers, and what does set you apart in the way that you’re helping them succeed in life.
And once you get that flavor, all of the other marketing messaging starts to fall in place.
Peter: Right. I like that example of a company we recently worked with that referred to their grandmother.
Chris: Yes.
Peter: You wanna relate that story a little bit?
Chris: Yeah. We had this great company that said, Yale, when we did our first work, it was for our grandma. And so it kind of became a saying is good enough for grandma. Is this good enough for grandma? Because if it’s not good enough for grandma, it’s not good enough for our clients.
We actually ended up tweaking that phrase a little bit to saying only the best for grandma. So we want only the best for grandma and only the best for our customers and our clients. And that kind of set a standard, and so they’ve got a block on their website about that origin story and how it all began. When we think about these ideas of having a great brand, doing great business, and getting incredible referrals, in the end, what it comes down to is that you provide great products, great services, and you help people succeed in life. And then you ask them, would you please keep us in mind in these very specific settings and tell your friends, your neighbors, your clients about us?
Because we love doing great business with great people. You’re a great company, and we would like to be in business with the people you do business with, if it’s the right setting. Yep. And that’s an amazing way to think about this entire chapter of orchestrating and stimulating referrals.
Peter: And I, and I like Alan Dibbs’ final thought, the final paragraph, Alan, he says, as a small business, your best hope for emulating what the big brands do with respect to awareness is focusing on sales and then turning your customers into a tribe of raving fans. This is the advice I give to any small to medium business wanting to work on branding.
Chris: I love that. Turning your customers into a tribe of raving fans. It’s a great book. You need to read it, digest it, and understand the power of being able to look at one page and know this is our strategy, this is the core of who we are, and this is where we’re heading. And when you can sum it up on one page, you can keep it in your mind on a daily basis as a business owner, as a manager, as a sales department.
Peter: Thanks, Goldman, for walking through the one Page Marketing Plan with me. I think this has been very helpful for our listeners. And if you would like to learn more about the one Page Marketing Plan and how it could apply to your business, please go to our website, bizmarketing.com and book an appointment with us. There’s a big red book appointment button. Just click on that, find a time that works for you and we will meet up with you and learn about your needs and look for ways that we could apply the principles of the one Page Marketing Plan and help you do that and help your business grow and continue to thrive.
So thanks again, Goldman. Hey, See you next time. Thanks for listening to this episode of Biz and Life Done Well with Peter Wilson. You can subscribe to us on iTunes, Google Podcasts, Spotify, and most of the other popular podcast platforms. Please tell your friends about us and leave us a review so even more people will find out about us.
Thanks again. We’ll see you soon.
