Good referrals come from the effort you put into creating a positive image. Some ways you can do this are:

Make sure customers have positive experiences with your company. The saying “the customer is always right” has always held true.

Go the extra mile for your customers. An article in Inc. magazine featured a contractor in California, named DeMar Plumbing, Heating & Air Conditioning, which implemented the “extra mile” policy. The company had budgeted $500 to rent a crane to install a compressor. After some bad weather, the ground was too wet. Since DeMar had promised to complete the job that day, they hired a helicopter for $1500. Even though they had to rent the helicopter, they stuck to their original bid. They videotaped the installation and gave a copy to the customer.

The customer showed the video at a party he was having. As a result, DeMar picked up a new customer on a job that netted over $5,400 profit. Going the “extra mile” really does pay off.

You must be ready and willing to confront any problems your customers have. Getting good word-of-mouth is only half the story. Avoiding a bum-rap is equally important. Make sure your customers know that you are interested in hearing from them if they are not happy with something. Dissatisfied customers will each tell 10 people about their bad experience and those 10 will pass the information along to 10 others. The result is 100 people with the wrong image of your company.

The best way to stop people from spreading negative images of your company is to uncover problems and solve complaints. Be sure to act quickly to take care of any problems. Carry a pocket note pad and write down complaints, along with the date and what you plan to do to resolve the problem.

After you listen to your customer’s problem and have written it down, read it back to the customer. This will make it clear that both of you understand the problem. Some of the best referrals come from customers with the most problems. It all depends on how well you the problem.

Make sure your customers are so happy with your company that they will be willing to tell friends about you. They will if they are treated right and perceive they’ve gotten a good deal.

Make sure your customers know that you are interested in referrals. Integrate referrals in both your on and offline marketing efforts. Be sure to thank them when you do get one. If you get a sale from a referral, give the customer a gift certificate to a local restaurant or a discount on a future purchase.

Increase business with your existing customers by sponsoring some kind of information-based event: a workshop, seminar, luncheon with a guest speaker, trade show, or special event; send a postcard announcing a private sale with special discounts or added services exclusively to your loyal customers; develop add-on products, i.e., a deck contractor could offer a deck renewal package to customers (these are called “back end” sales); or develop a newsletter to distribute information of interest to your customers and offer add-on products with each issue.

You gain credibility from the endorsement of enthusiastic customers who can persuade prospective customers to try your product or service. Consider offering a discount to customers in exchange for a positive reference. This is called seeding the market.

If you treat your customers right, they can become your best sales people. You can’t buy this type of publicity. The key to satisfied customers is good customer service. That is why we have an entire chapter dedicated to customer service in this book.

When you receive a good referral, ask the customer to write you a short note or record an audio testimonial over the phone about their experience with your company. Put letters in a binder and use them in your sales presentations. Businesses can frame the letters and post them on a “wall of satisfaction.” We know of one large company that uses these framed letters to line their halls — it’s quite a statement!

This entry was posted on Friday, November 9th, 2007 at 11:23 am and is filed under Follow-up, Marketing, Offline Marketing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.