Love The One You’re With
The vast majority business owners I speak with tells me that word of mouth is their most important source of new customers. However, these same business owners go on to tell me that they spend most of their time and money chasing new prospects using a variety of promotional activities like SEO, social media campaigns, direct mail, radio spots and other advertising tactics that do very little to elicit actual word of mouth referrals from their current – and presumably – most loyal customers. Think about it. Why spend tome and money on generating new customers from strangers when the biggest pool of warm referrals is at your fingertips: your current customer base?
Year after year, The Nielsen Company tells us that consumers place greater trust in word of mouth referrals than any other type of advertising. In a recent study by Nielsen, 84% of respondents said that they either completely trust or somewhat trust word of mouth referrals from a friend or family. Not only do your prospects trust the referral from their friends or family, they actually take action based on the referral. In the United States, 79% of consumers surveyed they are likely to take action when given a referral. When was the last time one of your prospects trusted your direct mail piece, website banner ad or Facebook company page at that high of a level? When was the last time that any form of advertising you used generated action in 4 out of 5 people it reached. My guess is “never.”
Another benefit of word of mouth referrals is the fact that “birds of a feather flock together.” Your current customers spend time with people who have the same interests, attitudes, opinions and backgrounds. If your customers are happy with your products or services, their friends will be as well. These referral prospects are pre-qualified!
I know that many businesses keep in touch with their current and past customers via newsletters and the occasional greeting card. Those are good tool but they are extremely passive. They rely on an active interest on the part of the recipient to go out of their way to make the connection between a friend and the business in question.
Why not make it easy for your customers to connect their friends and family to your business?
Pick up the phone and call your current and past customers. Check in with them and genuinely care how they’re doing. And, don’t tell me “Oh, I’m too busy to call individual customers.” If you have one quick call with a customer each day of the week, you’ll reach 250 customers in a year. If only 10% can refer new business to you, you end up with 25 prospects and 20 likely new customers. That’s a pretty good ROI for a short phone call each day.
Make it easier for your customers to refer new clients to with technology. My students at Bentley University are doing some really interesting work with Referron, a smartphone app that makes is easy for customers to instantly make referrals between prospects and your business. The prospect gets a note with a solid referral from their friend. The business owner gets the prospects contact information allowing them to reach out proactively to this new, warm lead. And, the business owner can track and reward who is sending them the most referrals. No more dropping the ball after a referral is made.
Your loyal customers are your best forms of advertising. Wouldn’t it be nice to stop chasing stranger and start welcoming more pre-qualified prospects into your pipeline?