The short answer
A referral system has five parts: describe exactly who you want referred, ask at the moment customers are happiest, make referring easy, build two or three referral partnerships with businesses that serve the same customers, and track and thank every referral. Good work makes people willing to refer you. A system makes it happen consistently.
Ask a service business where its customers come from and the answer is usually referrals. Ask what it does to get those referrals and the answer is usually "good work."
Good work is the entry fee. It makes people willing to refer you. It doesn't make them remember to, and it doesn't tell them who to send or what to say. That part is a system, and you can build it. John Jantsch wrote a whole book on the subject, The Referral Engine, and what follows rests on its central idea: referrals happen by design.
1. Decide who you want sent to you
"Anyone who needs a lawyer" gives a referrer nothing to work with. "Someone who has just started a business and doesn't have their contracts in order" brings a specific person to mind. Describe your ideal referral in one sentence, including the moment they need you.
2. Pick the moment to ask
There's a point in every job where the customer is happiest: the result has landed and the problem is gone. That's when to ask. Find that moment in your process and make the ask a standing step. Most businesses ask with the invoice, or never.
3. Make it easy
A happy customer who wants to refer you still has work to do: remember, explain what you do, make the introduction. Reduce that work. Give them a sentence they can forward. Offer something useful their friend gets for free, such as a short review or an assessment, so the introduction is a favor to the friend and not just a lead for you.
4. Build a few partners
Your customers buy from other businesses before and after they buy from you: an accountant, a web developer, a property manager. Two or three of those relationships, where you send each other the right people on purpose, can outperform everything else you do. Start by referring to them first.
5. Keep track
Write down every referral: who sent it, when, and what happened. Thank the sender every time, whether or not it turned into work. You'll soon see that most referrals come from a handful of people. Look after them.
Where it fits
Refer is the last of the seven stages of the Marketing Hourglass, and it's the one that feeds the first. A referred prospect arrives already trusting you, which shortens everything in between.
If you want this built for your business, with the asks, the partner outreach and the tracking sheet written for you, it's one of our fixed-scope sprints.
Frequently asked questions
How do I get more referrals for my business?
Treat referrals as a system: define your ideal referral in one sentence, ask at the point in every job when the customer is happiest, give people an easy way to introduce you, build a few referral partnerships, and track and thank every referral.
When is the best time to ask for a referral?
When the result has landed and the customer's problem is gone. Find that moment in your process and make the ask a standing step, rather than asking with the invoice or not at all.
What is a referral partner?
Another business that serves your customers before or after you do, such as an accountant, a web developer or a property manager, where you send each other the right people on purpose. Start by referring to them first.
Should I track referrals?
Yes. Record who sent each referral, when and what happened, and thank the sender every time. You will usually find most referrals come from a handful of people, and those relationships deserve the most care.
What book explains referral marketing systems?
The Referral Engine by John Jantsch, the founder of Duct Tape Marketing. Its central idea is that referrals happen by design.
Stephen Conley
Founder of The fCMO Agency and Gisteo, and a Certified Duct Tape Marketing advisor.
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