Referral points

25 March 2010

It is about getting the right type of client. If you are starting with a modest, sales-based client bank, you almost certainly will not be getting any referrals. If you have a bigger client bank, you can rely on referrals. This is still the best way to generate new business because there is a pre-qualification aspect - if my friend or relative trusts you, then we trust you too. This means that the conversion rate is very high.

At first we were reticent but we have now got to the stage where we encourage clients to refer people to us. It saves a lot of time on marketing. We have built these referral requests into our annual review process so it is formalised in our systems. We send a gift as a thank you present and as a gentle encouragement to give us a few more referrals!

Our best strike rate has come from referrals but we have found other marketing initiatives useful. For example, we have also been successful with the PR work we have done. We have been involved in the consumer press and the weekend national press. Occasionally, your name gets hidden in articles but if you say something sensible, it will often get enquiries. While it is not quite the same weight as a referral, there is a tacit approval and credibility there.

We also do some internet marketing. Part of this is about trying to drive as much traffic to our website as possible and then engage with people on the website. Quite a lot of people call to ask about our services on the back of that. Some of those will be great but others won’t be. In some cases, we will say that they will not benefit from our services but it is still them finding us rather than us finding them and, as such, is positive.

At first we were reticent but we have now got to the stage where we encourage clients to refer people to us

There are things that have not worked so well. We have not tried seminars, because we have always been put off by the cost and hassle. We also have not done much with professional connections. We believe a lot of people talk a good game but we wonder how profitable it really is.

Also, we have done some print advertising and it has not really worked, particularly when you factor in the time and cost of getting a printable advert. Part of the reason may be that we have done one-off adverts rather than a series. Overall, we have not had any disasters but that is because we have not spent huge amounts of money. We are trying to factor in the time cost rather than just the straightforward monetary cost.

We have two strands to our marketing drive - one is relationship-based and the other is credibilitybased. Our first aim is make sure that people understand the reality of what we do and how that relates to what they want. We want to ensure people respect our work. This comes through things such as qualifications. We have won awards, we have written white papers. This creates credibility.

We also want to ensure that people think we are honest and straight. We don’t know all the answers but we are sincere and people know what they are buying from us. Keeping the website relevant and informative takes effort but we want to make the intangible tangible. On the relationship side, we are only interested in referred business. A few people call us unprompted but it can be very draining. They may compare us to six other firms and there will always be someone cheaper with a shinier smile but you can’t be everyone’s friend.

We are clear about our referral process and even mention it in our welcome book. We ask all our clients to refer at least one person to us and we always ask who would benefit from the association. We think that if people are not referring people to us, we must be doing something wrong, so we need to know what we need to do to be referred.

Keeping the website relevant and informative takes effort but we want to make the intangible tangible

We have recently devised some new initiatives on referrals. We have a referral card, which holds our logo, who we are, our values and the main contacts. For key clients, we package up five of these inside a silver cigarette case with the client’s name and how long they’ve been a client. These clients become “referral champions” and we donate £250 to the charity of their choice for everyone they refer.

We believe that you need a story to tell. It’s about “critical non-essentials”. For example, the drinks menu in our waiting room is more extensive than most restaurants - it gives something to talk about. We have also done work with “centres of influence” - accountants, tax advisers or lawyers, for example. We position ourselves as a positive force to help them run a better business. We have generally avoided all the social networking sites but I did sign up to Linked In recently. There I found five clients and found that I ended up with recommendations via the site. I couldn’t have done it better myself.

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