How to Generate Referrals Without Spending Any More Money

Increase your repeat and referral business (at no extra cost to you) by understanding the difference between recognition and bribery. The difference is simple!

It all comes down to where it happens in the sales process. Bribery happens pre-sale, recognition happens post-sale.

Let me explain. If you give me $20 off to buy your product, that’s a bribe. However, if you spend $20 on me after the sale, that’s recognition and recognition produces results!

I was running a customer service seminar and one of the participants told me the following story. Mrs. K was test driving a Lexus and the salesperson was asking a lot of questions (as a good salesperson should). One of the questions was, “What type of music do you like?” This didn’t seem particularly relevant until Mrs. K took delivery of her new car and sitting on the front seat was a package containing $200 worth of CDs of her favourite music. Thoughtful? Actually, it’s more than thoughtful, it’s good business.

Here’s why. I asked Mrs. K how many people she’d told about the CDs. She said she’d told about 100. I then asked her how many people she’d told about the car and her reply was particularly revealing. She said, “None initially. But when I told them about the CDs, they all wanted to know what car it was and then I told them how happy I am with my Lexus.”

There’s a lot to be learned from that story. I believe that referral business comes from what I get that I don’t pay for, not what I get that I do pay for. No matter what we sell, if we want to increase our level of referral business, we’ve got to get some CDs in with our Lexus.

One of the hardest things to come to terms with in business is that nobody cares about your business except you. As a customer, even a satisfied one, I’m not going to spend my time talking about your products or services unless you make it easy for me to do so. I’m only interested in what’s in it for me.

Understanding this, our challenge is to offer the ‘CDs with our Lexus’ package that is appropriate to our business. When I train a group of salespeople or managers, I offer 12 months marketing consultancy free of charge. A computer dealer might offer a free dust cover for the comuter and printer. A hotel manager may send a ‘thank you’ card to guests for staying in his hotel (when was the last time you received one?). A car dealer may give a dozen golf balls to a buyer if he plays golf (everyone at the golf course will hear about that car dealer). These extras not only add value to your product, they give reasons to your customers to tell other prospects about you.

The main thing you’ll find is that $20 worth of recognition will bring you far more repeat and referral business than $200 worth of bribery.

Be more than a provider of products or services that meet your client’s expectations, look for ways to exceed their expectations and enjoy the repeat and referral business that comes from it.

Sebastian, a Senior Business Consultant with SP Solutions, advises and educates trade based businesses owners on how to grow their business and ultimately their wealth. Specialising in the Plumbing and Electrical trades, Sebastian focuses on the mindset of the business owner by listening, challenging and ultimately changing their way of thinking in order to achieve the best results out of any given situation.