do your clients even know you want them to share your name?
by sandi leyva
the most popular way to get clients is from referrals or by word of mouth.
more small firm growth strategies: measure client retention … against yourself | turn to the abcs for client feedback | use client ‘touch plans’ to stay in touch | build your revenue plan in reverse | 5 fast, easy ways to turn annual clients into year-round clients | best practices for growth: network, specialize, share | how to handle referrals – and how not to
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a referral takes place when other clients refer you to their friends or a business associate passes your business card to a prospect, and the prospect calls you for more information. at the beginning of your career, you may get started with referrals from relatives, personal friends, previous employers or co-workers, or other entrepreneurs if you have been active in professional business groups.
tip: always maximize referrals. they are the least expensive way to get business.
referrals are, by far, the best way to get business because they come to you with little effort and most notably, they are pre-sold. you don’t have to do much at all to convince a referral to do business with you. referrals are especially good for accountants because they require little selling, and most accountants hate selling.
there are many different types of referrals. you can get referrals from existing clients. you can also get referrals from other businesses, friends and people in your business networks.
one of the biggest problems with referrals is that many entrepreneurs wait for them to happen. you don’t have to wait; you can do a few painless, low-cost actions to accelerate your referrals.
here are several ideas you can implement to increase, reward and encourage more referrals so you can get as many clients as you can from this channel before you go on to the next channel in your marketing plan.
identifying and rewarding your referral sources
if we don’t stop to look, we might not even know who is sending us the most clients. here’s a spreadsheet idea to figure out your top referral sources.
if you are starting or restarting your business, try to do as much of this exercise as you can. go back in time, or use the current clients you have now.
first, create a sales by customer summary report in quickbooks or a similar report in your accounting software. run it for whatever period you want to review, and sort it by revenue in reverse order. this will give you the names of your top revenue-generating customers.
the next step is to add a column that lists how you found each client. if it was through a referral, enter the referral source in the new column. if you don’t remember, you will want to put a procedure in place for the future so you can track this. this piece of information will help you know where to spend time and money on your marketing. you may want to create a custom field in quickbooks to record this information.
once you’ve added this information to your spreadsheet, you can now sort the report by the values in the “how you found each client” column. add the revenue together if the same source generated multiple accounts for you. sort the report again by amount and see who your top referral sources are.
gratitude
once you’ve identified the individuals who have sent you the most business, you can decide how you want to reward and encourage their behavior. malcolm gladwell, in his book “the tipping point,” calls these people trendsetters. they have rolodexes 10 times the size of other clients and love to let their friends know what’s hot and what’s not. these people can become your own personal cheerleading team.
you might want to create a “referral touch plan” for your top referrals. at the very least, send them a nice card or letter with every referral.
here is a sample thank you note you can send to your referral sources:
dear client’s name:
thank you for referring ____ to our practice. we are honored that you thought well enough of our services to recommend us.
i am deeply grateful for your business. thank you so much for spreading the word for us.
best regards…
for your top referrers, i recommend you periodically treat them to a country club lunch, send them a gift or gift certificate, or make a donation in their name to a favorite charity.
referral clones
want more referral sources like the top individuals you just identified? you really can clone them by doing this next spreadsheet exercise.
use your sales by customer summary spreadsheet from above and add a new column that classifies the type of referral for each line on your spreadsheet. for example, was the referral source a banker, a cpa, a peer, someone from an organization or networking group you belong to, an it person, an attorney, an hr professional or another category?
go through and classify the type of referrals you are getting to see which of the groups above is most prolific for you. once you do, go through your customer list and find out who their similar vendor is. this needs explaining.
if your referrals all came from an attorney, then ask your clients if they would be willing to give you the names of their attorneys. also ask them if they mind you contacting them. then meet the attorney and see if you can provide mutual referrals for each other.
you will be able to meet several new attorneys this way, some of whom could turn into additional referral sources for you. please allow them to get to know you and to build trust first, before you ask for referrals. you need to have earned the right to ask, however, since you do have a client in common, trust is highly accelerated.
if your referrals all came from one of your client’s it people, then go ask all your clients for the names of their it people, and systematically meet with each one. in that way, you’re “cloning” your referral sources so that you multiply your referrals.
as you get into this process, you will get some additional ideas about how to make this idea work for you. be sure you reward your referral sources well.
this can be an overwhelming number of meetings. i recommend you set a goal number of people to talk to each month or each week as part of an ongoing plan.
please note this is a high-payback, extremely lucrative action item. but you have to stay with it. you can’t just do it for a few months and then let it peter out. you have to stick with it, keeping in touch with existing referral sources as well as developing new ones.
one tip to help these meetings pay off even more is to make sure you can describe in detail your ideal client. think about the age group, gender, revenue level, industry, pain points, geographic location and software type of the clients you are looking for. when you can be specific instead of saying “i’ll take everyone,” you will yield much better results.
referral cards
let’s take a lesson from my massage therapist, who handed me several referral cards when i offered to post a testimonial for her on a list i am part of. the referral card is a card that the referral source puts their name on and gives to a prospect. the prospect cashes it in and gets a discounted introductory service. the referrer gets a discount on their next visit. it’s common in the personal care industry, and it will work beautifully for accountants. see a sample below:
front:
spread the word!
do your friends need help with their books or taxes? help them out and help yourself at the same time.
receive $50 off for both you and every new client you refer. refer 5, and receive a free month’s bookkeeping.
back:
i’d like to refer ___________________________________________ to your services. please give them a $50 discount on their first service.
referred by: ________________________________ date redeemed: ____________
* this referral card is required to be presented to receive discounts.
* not good with any other offer.
abc accounting * 123 easy street, new york, ny 10010 * 212-555-1212
ask for referrals
your clients literally do not know you need referrals until you tell them. here are a few very subtle painless ways to send the message:
- add a line to the bottom of your email signature that says “we love referrals!”
- while you’re onsite, mention that you’d love to have more clients like them.
- write a note at the bottom of the invoice that says “we love referrals!”
- stay in touch with clients via personal emails, visits and newsletters so that you stay top of mind with them.
the following idea may be a little uncomfortable for some of you. if it is, then don’t worry. just skip it and go to the next idea.
- ask the client for two referrals as part of the business contract. let them know it’s a standard procedure.
- better yet, ask the client to provide a personally written testimonial letter to send to five other leaders (peers) in the same industry – assuming you do a good job, of course.
a dentist i know asks for three referrals as part of being a client of his. his clients know up front that providing referrals is part of the relationship.
when you ask for referrals up front, make sure you don’t sound needy. just make it matter-of-fact and part of your process of signing up new clients.
if your business is established and you’re looking for a small percentage of new clients, the natural time to ask for referrals is at the end of the engagement. simply ask the client if s/he knows of other people who would benefit from your services. don’t wait months after the engagement is over; not only will it be hard to track the person down, but the warm and fuzzy end-of-project feeling will have worn off, and your client may not remember the details of your work.
be careful of your timing when you ask for referrals. in our web design division, i work with it people all the time who work with me to set up a client’s email. one person sent me some technical domain changes to make that were poorly documented, i made them and something didn’t work quite right. i made a change based on my intuition. it took care of part of the problem. the it person immediately emailed me, saying, “success! i’m available for referrals.” my test emails were still failing at the time. what a turnoff! i would never refer that person as she brought my client’s email down for two hours in the middle of the day. so it goes without saying you need to do a great job and also know when you have earned the right to ask for referrals.
another way to gain referrals is to provide them yourself to vendors you do business with, and let them know you want them to return the favor.
incentives for referrals
in my web design business, i used to offer one hour free to clients who sent me a referral that resulted in business. with this small incentive, my clients are on the lookout year-round for referrals for me, and a few have become my own little marketing army, at very little cost.
tip: paying a bit for referrals is still cheaper than marketing.
to let them know about the program, you can post it on your website or better yet, send clients a letter with the wording below:
we appreciate your referrals and thrive from them. we are able to keep our fees low because we don’t have to advertise.
when you have referred to us a client who purchases ___ services from us, you will receive ___ from us in appreciation of your support.
thank you for your continued support. i am grateful.
wording to add to your invoice to increase referrals:
want to reduce your bill by $100? send us a referral that results in business and we’ll take $100 off your next bill. we appreciate your support.
a word of caution to cpas: although it’s common in our profession to purchase clients by purchasing an accounting practice, it may be considered a state board violation if you do it one at a time. please be sure to check your state board’s rules on commissions to clients or referral sources, especially if you have attest services in your practice.