In this multi-post series, we’re going to take a closer look at referral marketing. John Jantsch’s The Referral Engine: Teaching Your Business to Market Itself should be on EVERY small business owner’s bookshelf. There’s an interesting statistic in the book: about 63% of small business owners say they think over half their business comes from referrals, but 80% don’t have a referral system in place! Is this you?

Referrals do the work of marketing for you, especially once you get your referral marketing system in place, but there are a few things you should know first.

Your customers must trust you before they will refer you. Under promise/over deliver, not vice versa.

“The higher the price tag, the more essential the service, the more vital trust becomes to the relationship.” – J. Jantsch

AND, according to Jantsch and the research he found, people want to give referrals. They want to help your business! Referring people builds our social currency, we like to connect, and mentally rating/categorizing things is how we organize information. Your satisfied customers are psychologically eager to help you out.

So, how do you build trust? Consistent good service is a key factor. Meeting people’s expectations builds trust. Do you even know what your customers expect from you? Have you asked?

Standing out from competitors is another driver for referral marketing. Why would YOU do business with YOU instead of Tom down the road? If you can’t answer that, your business needs improving and you need to do some serious personal investigation. Boring, predictable businesses do not get talked about.

You know what I love? When I get an oil change and they vacuum my car and air my tires. It isn’t in the description of an oil change. It is a nice add that sets my place apart from the place down the street. What are you adding?

Referral marketing is easy marketing if you have a system in place and if you know how to generate referrals, but people take a risk when they refer you. Are you worth that risk?

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