Results Based Sales 2.0: Referral Selling

March 16th, 2010 by

By Pat Hinds

A few years ago I was managing a veteran sales person who had a robust list of contacts and was considered by his customers to be a reliable sales person. We were working together on setting targets for his sales territory and he made a comment to me that he did not do cold calls; he only uses referral selling to identify new sales opportunities. At the time of the comment the sales rep had a good funnel and I had witnessed his commitment to asking for a referral from a customer, so I was okay with his strategy.

After a period of time his funnel started to shrink and the rep was challenged to find new opportunities without picking up the phone and making some prospecting calls. I did learn from the rep that referral selling is one of the most effective selling tools available, but I also learned you couldn’t be one dimensional in the way that you use referral selling.

Listed below are definitions for referral:

“Acquiring new customers who are suggested or referred to by existing customers. Referral selling is the basis of all direct selling such as network marketing.”

“Character: a formal recommendation by a former employer to a potential future employer describing the person’s qualifications and dependability; “requests for character references are all too often answered evasively”

In the sales 2.0 environment companies have the opportunity to leverage referrals throughout the entire sales process. Listed below are some examples:

1) Cold Calling – During a cold call I use a position statement to help define the reason for my call. I often split the statement into who we are, why we are calling and a quick customer reference.

2) Follow-up email – After a cold call I will send the contact an email and I like to include a link to a customer press release, white paper or video.

3) LinkedIn – I like the feature in linked that allows you to get members of your network to provide you with a personal reference. Inviting a customer to join your network allows him to see you personal referrals.

4) SlideShare – Posting a presentation on SlideView that is a customer case study with a referral is an effective way to share referrals.

5) Website – Put a customer referral on the front page of your website for all visitors to see.

These are just a few ideas on how to leverage customer referrals to help generate sales. Make sure you are asking customers for referrals and you are sharing them with your target audience.

Topics: CRM