Create a Referral Machine for Your Business

I find that small business tends to run in families. If one of your parents was an entrepreneur, there is a high likelihood that you may be one too, and that makes sense: Parents instill values, and if self-employment was one of their values it just may be one of yours too. Of course this is not a hard and fast rule, but it does seem fairly consistent.

So not surprisingly I suppose, I grew up in a small business household. My dad owned carpet stores. And what was his best business trick? At the end of his career, he had a sign in his carpet warehouse that read, “Our Word Of Mouth Advertising Starts With You!” After 25 years in business, the one thing dad learned is that word of mouth, or referrals, is the best thing out there for succeeding in business.

I mention this today because I want to refer you to a great new book about how to create referrals for your business, called The Referral Engine. The book was written by my colleague John Jantsch. You may know of John due to his Duct Tape Marketing program, but even if not, you should know of him. He’s as sharp a marketing wiz as there is out there.

Jantsch says that although most small businesses get a lot of work from referrals, few have any system for creating them, and that was why he wrote the book – to help readers create a self-generating referral machine.

Cool idea, eh?

Essentially, Jantsch says that there are three aspects to creating your own referral engine:

1. Be great: Why do you refer someone to a business? Because you have been impressed, right? So if you want referrals for your business, you have to continually impress people. Being a great business is the foundation of referrals.

2. Start the cycle: John explained to me that if you want referrals, you need to get customers into a cycle he calls “know, like, trust, try, buy, repeat, and refer.” To refer business to you, people must learn of your business, check it out, like it, learn to trust it, and then become repeat customers of it.

It is only then that they will refer their friends to you.

So your job is to connect with current customers in order to start the cycle. You do so by engaging them with social media, on your website, and in person.

3. Find some strategic partners: Another way to create a referral engine is to find businesses similar to yours and do some projects together. It could be a joint sale, or a cross-marketing campaign, a joint seminar – whatever. The important thing is that once you impress this new company, they will start to refer their customers to you, and voila! More referrals!

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