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The secret to growing a referral based business.

dietz_agency_guideI remember when I started my career many moons ago. Someone told me that my goal should be, to become a referral based business.  A business where all of my clients are referred to me.  That sounded so nice.  Just sit in the office and the phone just rings away with people who are being referred over.  I had no idea how to do that, but I had a sense that it would take a lot of work.

I put some thought into the matter and tried to think of what type of business would refer to me.  I then tried to think of why they would refer to me and thought I had it figured out.  I sell insurance, so a natural referral source for a business like mine is someone who sells mortgages.  Of course!  They NEED insurance to close the loan.  So I will go in to mortgage brokers and tell them my prices are very fair, AND that I will take excellent of their clients.  I told them I would also refer to them.  Perfect!

That is what I did.  I drove around, I had my new business cards and I cold called mortgage companies.  This was going to be so easy.  I walked into the first place and met the gatekeeper.  I gave her my juvenile, poorly thought out speech, and left my cards with her.  I did that two more times with different companies.  After the third one, I noticed a trend.  I got the feeling that I wasn’t the first person to think of this.  There were insurance cards at every desk I went to.  Someone had beat me to it!

I felt like a fool.  This was the most unoriginal idea ever.    I was offering to take care of their clients?  No sh$t.   I had nothing unique to offer, nothing of value and they had no idea who the heck I was.

About a month later, I sat through a presentation from a company that helped me a great deal.  They were selling a system specifically for this issue and specifically for these two industries.  The deal was, if you are a mortgage broker and you sent me a referral and I earned their business, I would send 7 physical greeting cards a year from you, to the client.  There were birthday cards, an anniversary card, a groudhogs day care, 4th of July cards, etc, and they were all signed by you with 3 of your business cards in it.  I would also do it for 5 years.  I was going to keep you in front of them every 9 weeks for 5 years to that they could remember you, and refer to you.

That is what I am talking about!  I loved this system and started to work it and now had something others didn’t.  I not only started getting referrals, but I wrote insurance on the brokers themselves and now they were referring their clients to “their” agent.  I was getting by gatekeepers and having meetings in front of teams of brokers.  Soon I able to walk in unannounced and essentially hang out and chat with them casually.  I found it was those conversations were the most important.  I found out about their families, their hobbies, their likes and their dislikes.  I also found out I was good at these conversations.  If you can keep them talking about themselves, the more you learn and the more comfortable they feel with you.

That experience was an important professional awakening.  That entire process, from finding that system, to getting comfortable with the referrers, took about 9 months.  But I had cracked the code.  The problem was, this was in 2006.  By the end of 2007, all of these people that I had built these great relationships with got out of the business because of the great recession.  That sucked.

By the time the market had turned around 3 years later, my system was outdated.  All the brokers had the same follow up system, except it was automated by software.  The didn’t need my system anymore and my golden ticket was obsolete.

Over the next few years, I learned more powerful way to get referrals.  Give one.  I would go out on marketing appointments, or marketing events with a room full of people and ask one question.  “Who do you need to meet”?  At this point in my career I had been marketing for 6 years and knew a lot of people.  I knew, lawyers, accountants, painters, roofers, social media experts, auto repair shops, glass repair companies, financial advisors, pest control people, realtors, mortgage brokers, psychiatrists, acupuncturists, chiropractors, restoration company owners, and more.

Everyone has an answer to that question.  The would say, “Well Matt, I need to meet promotional product guy.”?  This point of the conversation is crucial and has to be done properly to get the most out of this situation you have put yourself in.  I tell them, I have a guy who does that, his name is Craig, and I am going to have him contact you. I DO NOT GIVE HIM CRAIG’S INFORMATION AND LEAVE IT AT THAT. Nine out of 10 of those die on the vine.

Then I immediately call Craig and tell him that I have some business for him.  Everyone has the potential to win in this scenario.  Craig is absolutely going to call this referral. I have vetted him, and I know he will follow up. The guy who needs the promotional product, I have made his life easier because I have filled a need that he has had.  Both of them will inherently, feel the need to thank me.  How will they do that?  They will refer someone to me.

People ask if there is a magic bullet or if you can catch lightning in a bottle in marketing and sales.  This is the closest you will ever get.  It’s called the “Givers Gain” philosophy.  There is a great book I would recommend as well called “The Go Giver” by Bob Burg.  The more you give the more you get. It’s truly a wonderful way to do business.  Now go start giving.


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