Stop Leaving Money on the Table!

Referral business is the best kind of business to acquire! Do you agree? Most business professionals agree whole-heartedly. It’s been shown that referral business is more likely to close because the person being directed to you is already pre-sold by the individual(s) referring you. The prospective client is ready to do business with you.

If referral business is so good, then why don’t we do a better job of managing its productivity and profitability? Most business professionals, including attorneys, fall into the trap of wearing referral blinders. Referral blinders keep you from seeing money on the table (referral opportunities) all day, every day! Referral blinders limit the view of your referral network. I would venture to bet that most of your current referral business is coming from current or past clients. If so, you’re actually in the norm. Don’t get me wrong … referrals from current or past clients are absolutely wonderful, so long as they’re the right kind of referrals. However, if you limit your referral base to one component of your referral network, you’re leaving a significant amount of money on the table! Are there other elements to the referral network? Absolutely … we’ll get to that in a few minutes.

Small professional firms need to be exceptionally savy at leveraging the human element of business. This fundamental human element of business is the personal relationship. Referrals are not a guarantee and they don’t just happen. They are born out of strong, long lasting personal relationships and they take time to develop. The significant point to remember here is this; you can control the flow and the accuracy of the referrals you receive! Most professionals never consider this as a viable truth.

Imagine your referral pipeline as a faucet. A faucet will only flow water when the handle is turned on. The operator of the faucet has full control over how much water flows through the faucet at any one time. You too can control your referral pipeline just like a faucet. It is within your power to develop profitable, reciprocal referral relationships. Once these relationships are developed, the referral faucet will start to flow and you can control is volume.

Controlling the flow of your referral pipeline takes a systematic approach to referral marketing. The first place to begin is to strategically analyze your current relationships for those people that are most likely to refer you, beyond your current and past clients. Your referral network contains eight components that can generate a flow of referral business for you. In this article, we will focus on two of those classifications: people in your contact sphere and people you currently do business with.

People in your contact sphere
A contact sphere is defined by “professionals who serve the same target market as you, but for a different reason”. Notice that this is not your competition, because these professionals serve your target market (those like your best client) but for some other purpose.

Let’s consider who might be in the contact sphere of a divorce attorney. A divorce attorney is typically in front of clients who are contemplating or currently involved in a divorce. Who else might serve the special needs of a couple experiencing conflict? I would suggest a social therapist, a career coach, a wellness specialist, a mediator, or a minister to name a few. These professionals would likely have multiple clients that they could refer to a divorce attorney and on the flip-side the divorce attorney could certainly refer her/his clients back to these professionals as well.

The people in your contact sphere provide for a natural reciprocal referral relationship. They are potentially sitting on a nest egg for you! However, first and foremost, you have to find the right professional for your contact sphere and you have to develop the relationship! Not every person, simply by title, is the right fit for your contact sphere.

So, who might be in your contact sphere?

People you currently do business with
The next time you write a check, personal or business, notice whose business you are supporting. Take a few minutes to add up how much business you have given to that company or individual over time! Which businesses have you referred business to over time? Which of these businesses are local to you? When is the last time you asked any of them to support your business?

Let’s look at a few examples. If you’re like me, you probably could say that you personally funded the west wing of your veterinarian’s office over the years. And, if you like this vet, you probably referred him a few clients over the years, too. Have you ever considered asking the vet to, in some way, support your business as well? It’s not too late to ask!

Let’s say your vet mails a quarterly newsletter or has a website. As an attorney, why can’t you write an article for the vet’s publication that spells out the legal considerations of aggressive dogs, or the legal benefits of keeping your dog on a leash? I suspect that the vet would appreciate the time saved in not having to find material for that quarter and you would appreciate the exposure to his clients. Or maybe the vet could sponsor a golf hole at your next client golf outing?

Another example might be your hairdresser who has cut your hair for the last 12 years. You have sent five of your family and friends to this person as well. How difficult would it be for the hairdresser to have your business cards or brochures placed in the waiting space for their clients to pick up at will? Or perhaps the hairdresser would agree to invite her clients to a presentation that you’re holding called, “The Value of Estate Planning”?

Each day that you miss these opportunities, you are in essence leaving money on the table. These are great strategies to implement, however it takes your ability and willingness to ask for support. You might be thinking to yourself … great, but what if they say “no”? My question to you is this … “How long would you permit a personal relationship to last if it were only one sided?” Why accept anything less in a business relationship?

Referral marketing is all about the skill at which you leverage reciprocal relationships to move your business forward and generate high quality referrals. The truth is; it is the most cost effective method for growing your practice. When a referral marketing system is in play for your business, you not only begin to see the money on the table, you begin to capture it!

Referral marketing is truly the human way of doing business.

By Michelle R. Donovan, The Referability Expert and owner of Pinnacle Training Services and Referral Institute in Sewickley, PA. Michelle teaches a referral generating system that covers all aspects of productive and effective business networking and referral marketing. Her goal is to provide business owners with continuous never-ending profitability from word of mouth referrals.