The #1 Reason Referral Channels Don’t Work. In Blackboard Fridays Episode 49, Jacob talks about Marketing. Need this implemented into your business? Talk to the international business advisor who can do exactly that – Contact Jacob, Learn More, or Subscribe for Updates.
In last week’s episode, we explained the simple 5 Step process to creating strategic referral channels.
It’s a simple approach … which doesn’t necessarily mean it’s easy. You have to hold yourself to the process … and you have to keep the other party interested in building relationships with you as well.
Even when there’s a great connection between two parties, I see this process go astray. And it’s because of old patterns, and one simple mistake that can easily be avoided.
If you’ve ever had a referral relationship peter out into nothing, you probably made this mistake.
Watch this week’s episode here, and never make the mistake again.
Who is Jacob Aldridge, Business Coach?
“The smart and quirky advisor who gets sh!t done in business.” Back independent since 2019.
Since April 2006, I’ve been an international business advisor providing bespoke solutions for privately-owned businesses with 12-96 employees.
At this stage you have proven your business model, but you’re struggling to turn aspirations into day-to-day reality. You are still responsible for all 28 areas of your business, but you don’t have the time or budget to hire 28 different experts.
You need 1 person you can trust who can show you how everything in your business is connected, and which areas to prioritise first.
Learn more here. Or Let’s chat.
In the last episode of Blackboard Fridays, I talked about the five steps to creating strategic referral channels. Connection, getting to know you, why and why not, agreement, and then implementing that agreement. I flagged that step three why you would be in relationship and why not be in relationship.
It’s one of the hardest steps to go through. It’s the reason most referral relationships don’t actually lead to referrals is because you avoid having hard conversations like this one. So, let’s give you a bit of a system to help make that conversation as easy as possible.
The key here is simple. If there isn’t a clear reason why the other party would send you referrals, then they’re not going to go out of their way to do it. You might get the occasional ad-hoc referral, but a strategic channel is someone who has a benefit and sends you clients on a regular basis.
Similarly, and conversely, if there’s a single reason why not a concern or a fear about why they would not want to send you clients, then they won’t and will kill the relationship dead. You need to have the hard conversation to go deep around these so that you know if there’s a fear that can be overcome or if it can’t be overcome, then you can stop wasting time with that relationship.
There’s a list here of some of the most common examples of why you would have a strategic referral relationship. I’ll just point out a couple. Mutual referrals is where people tend to go initially and it can be a risk if your business models are very different. I have a very small client base and I only work with a limited number of businesses each year but I’ve got a referral relationship with the business that it’s got a thousand clients, we’re never going to be able to have the quid pro quo, I scratch your back you scratch mine, the same number of referrals flowing either way. If I promise that, they’re going to be disappointed and letdown.
The other common one is around revenue. I’d encourage you to sometimes have the indirect revenue conversation. Are there ways that they will generate more revenue from their clients as a result of the work you do that saves you having to pay them a commission on your revenue or pollute the relationship with fees? Don’t feel that those referrals and revenue models, which are the most common conversations, are the only been that they might have.
There’s a lot of things around loyalty, reputation, protection of their client base that can motivate them to send you referrals. Have the broader conversation and if necessary, write out this list in front of them. Go through them one by one and have the conversation if that’s an easier way to have it. That’s something my clients say about this list of why nots which are the concerns and fears that stop a relationship.
It can feel confronting if you’ve never done it before to sit there and say “What are the reasons you don’t trust me yet or you won’t send me referrals? but if you can third party that by saying, “Here’s the process I’m following and it says these are some of the most common blocks in a relationship, can we talk about those?”, it overcomes that confrontational nature it allows you to jump into the specifics.
Again, some of these come up more than others. At its core, if they don’t trust you, if they’re uncertain of their relationship, if they’re not sure about the quality of the consistency of the work you do, then they’re not going to send their best clients to you. That individual is not going to go back into their business and change their workflow process to create leads for you. You need to talk these out and overcome them.
The last of these is, perhaps the most common and the most insidious and saddest when I hear about it, it’s people who actually do want to send you referrals and they’ve got a clear benefit they’ve overcome these concerns, but they just don’t know how. Make sure you take the time to talk through how they send you a referral and how you accept that referral, on board the client and then how you close the loop, keep them informed through the length of the relationship so that you continue to reinforce why they are in relationship with you and overcome any of these why nots that may show up from time to time. Have the hard conversation. The amount of time it will save you in fluffy coffees is enormous and the amount of revenue it will bring to you and your team is even larger.
Want to learn more about how this can apply to your business? It costs nothing to chat:
- Email me email@example.com (I read them all)
- Call, Text, or WhatsApp me +61 427 151 181
- Or just Subscribe https://jacobaldridge.com/about/subscribe-to-jacob-aldridge-com/ to stay in touch