Where Referrals Fit in Your Sales Strategy

New clients.

The name of the game to grow our businesses (or book of business).  Every year we set metrics and goals for how many new clients we need to bring on.

Whether your number is 10 or 100 new clients needed every year, I’ll bet you have some kind of plan or strategy to hit that number.  Your plan will have the activities you need to do on a daily, monthly or quarterly basis to help you hit the number.  Activities like networking, cold calling, direct mail, LinkedIn prospecting, Facebook ads, SEO, publicity via earned media, social media updates, attending trade shows, etc.  For some it is a well detailed plan that took hours to create and for others it is some version of “throw some activities up on the wall and see what sticks.”  But neither plan really matters though if you don’t execute on it throughout the year.

Which means that building a plan you will want to follow and will actually execute on is more important than all that planning (or non-planning).

Your Sales Activities

If I took the option off the table that you could “sit back and do nothing” for new clients to roll in…what are you willing to do to bring in new clients?

I don’t mean what you are willing to do when you have a level of desperation…we will all (at least most of us) make cold calls when our jobs or businesses depend on it.

What do you really want to wake up to each day when you think about your business development efforts?

For me, my focus for business development is generating referrals because I enjoy the process and it provides 90 to 95% of my clients.  Referrals are the holy grail of sourcing new clients because referrals are prospective new clients who have had a need identified, trust me without meeting me because of who referred them, less price sensitive and usually ready to start working together.

But it didn’t start that way for me.  (Read 112 Referrals Didn’t Just Happen.)

In the beginning, I had the three typical sales plans that every business owner or sales development professional needs when it comes to bringing in more clients.

The three plans that make up your overall Sales Strategy are a prospecting plan, a marketing/branding plan and a referral plan.

Most businesses start with one or maybe two of the plans but rarely all three.  Most business development professionals only start with one – the prospecting plan – while their company supports them with the marketing/branding plan.

Three Plan Breakdown

Prospecting Plan:

I describe this plan as the plan you need if you “want to eat tomorrow.”  These are the activities you do in hopes of creating short term success.  For example – heading to the networking event where you hope to meet one or two prospects who will agree to coffee to discuss the possibility of working together. This is the “pound the pavement or phones” type of plan that can produce results but take a huge commitment of ongoing and consistent activity.  You can be less reliant on this plan once you have an established referral plan – the third plan.

Marketing/Branding Plan:

This plan helps you establish yourself in the marketplace and build credibility.  Depending on your budget it may just include an online presence with a website and a few social media accounts.  A more robust budget may include advertising (online, print) or earned media through publicity.   You will also need some version of this plan to maintain credibility or name recognition in the marketplace.  *If you work for a company or corporation this part of the sales strategy may already be determined for you and provided to you.

Referral Plan: 

This is the ultimate plan…where new clients come to you through referrals.  Where new clients just show up in your inbox because someone connected them to you because you can help solve the problem.  Now growing a sustainable and consistent referral plan doesn’t happen overnight and there are no silver bullets but following the right steps can produce consistent results where you can hit your yearly new client or sales goals from referrals.  This allows you to lessen your reliance on the prospecting plan and marketing/branding plan.  My goal is to allow clients to eliminate as much activity from their prospecting plan as possible because they are experiencing consistent results with referrals.

Most small businesses owners and solopreneurs take pieces from all three and put them together as the overall sales strategy.  It looks something like this (see image below) and I call it the hub and spoke.  (There are a few doubled up and a few missing of course – this is not an exhaustive list).

Measure then Judge

Each spoke coming off the hub represents an activity that falls into either the prospecting plan, marketing/branding plan or referral plan.  Some people have many spokes and some have just a few.

Now this visual works because it allows you to see everything you are doing but doesn’t necessarily help you understand what is working…meaning which activities are producing the desired results.

In addition, you may be overlooking activities that could work for you if you knew WHAT to do.  For most people referrals fall into this category – they could work for you if you need what to do. When we don’t have a plan in place to specifically grow referrals, they don’t grow.  Sure, some referrals may happen haphazardly or sporadically but to truly generate referrals – so you can be less reliant on a prospecting plan or a marketing plan – you need to treat your referral growth like an actual standalone strategy with a plan you follow and track the results.

Not sure if you want to devote the time to generating a referral strategy?

Here is a simple activity you can do to help you assess the success your current activities are having and the results they are producing.

To make this easy for you I created a free resource you can download called the Sales Strategy activity sheet (use the form below to download).  It will walk you through listing out your current sales activities, provide you with a simple ratio to consider when determining the success of an activity and allow you to capture your top 3 to 5 sales generating activities.

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Houston, We Have a Problem…

The Sales Strategy Activity is only two pages so you can quickly assess your sales strategy.  If your results produce for you a “Houston, we have a problem” or “Not horrible, but not great either” results then you should consider other activities to generate the number of new clients you need.

After going through the Sales Strategy activity, you will know – based on data – if you need to eliminate a spoke due to poor performance or put more effort into a spoke that is performing poorly but should be providing you with more prospects.

If your Referral spoke is not performing well or at all…whatever you do…do NOT eliminate it.  You need this spoke!  It is the most important one and once you increase it you can decrease your reliance on other spokes (i.e. decrease your reliance on your prospecting plan) which will ultimately save you time and make you more money.

You will need a plan to increase your referral activity but it needs to be a plan you will follow.  As I stated earlier – you need to be willing to do the work to produce the results you want. I find following my referral plan to be one of the most enjoyable parts of my sales and business development strategy because it allows me to generate referrals without asking, without manipulation and following a simple process to plant referral seeds and build relationships with referral sources.

Let me know what your results were in the comments below from the Sales Strategy Activity and what you plan to change to have better success this year.  I’d love to hear from you.

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2017-09-11T16:52:58+00:00 Tags: , , , , |

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