How to Harvest More Referrals
With a new season ahead and fresh referral opportunities ripe for the taking, heed these insights from Peter Fournier, founder and owner of All Things Insurance Group, who explores how to make more of these lucrative contacts fall into place.
“I had to lower my company’s cost per acquisition, and the main way to do that was by prioritizing referrals.”
Fournier acknowledges a foundational fact of running a business: investing in earning more referrals is generally far less expensive than marketing to cold leads and trying to generate more business out of the blue. In fact, if you establish a smooth referral process, these contacts can become practically organic. This means that, with little ongoing effort on your part, new and highly relevant leads can continue to find their way to you.
“Statistically, referrals will close 50 percent higher than cold leads based on your business’s closing ratio.”
Fournier’s fact underscores the importance of prioritizing referrals over virtually any other lead source. Although your marketing and sales strategies should include cold and warm outreach, honing in on how you can maximize your referrals can tip some serious numbers in your favor. Whether your organization’s goal is to boost sales rates in a specific area, achieve certain revenue goals by the end of the year, or improve customer retention in an attempt to rein in your customer acquisition costs, focusing on your referral rates could be your most straightforward route to success this season.
“Staying in front of clients is one of the best ways to harvest referrals from them.”
For a client to refer your business to their loved ones, they have to remember you exist. While it’s an excellent idea to ask recently onboarded customers, or those who just made a repeat purchase, to share your name with their circle, don’t just request referrals on day one. Instead, your process should establish regular, consistent contact.
Consider Fournier’s strategy: reaching out to his entire client list every six months or so. This can include happy birthday text messages, holiday mailers, and follow-up emails (e.g., “We miss you! Let’s work together soon.”) Scheduling both promotional and personal touchpoints, and automating them where possible, can help prevent your loyal clientele from forgetting about you.
Additionally, maintaining an active presence and loyal following on your socials, which you should saturate with educational, entertaining, and endearing content, helps keep you top of mind with your client list. So if a client has a loved one or business contact who needs your products or services, they’ll instantly think to pass on your name.
“Requesting referrals is sometimes simpler than making a big ask.”
In other words, there are more ways to ask for a referral than outright stating, “Please tell your friends about us!” While this is a helpful tactic, there are subtler, more incisive approaches you could take to make the request.
Take the tactic Fournier uses within his own insurance company. When his team signs a new client, it requests that they list at least three beneficiaries for their policy. It tells the policyholder that a rep will be reaching out to each of those beneficiaries, explaining what it will share with each of these individuals, and then asking the client to text each beneficiary immediately to let them know that someone will be in touch.
Afterward, his team reaches out to the client’s contacts to start conversations. These are not overt sales calls but, rather, valuable discussions, notifying the client that they were listed as a beneficiary and by whom. But the discussions don’t end there. Fournier’s team then asks the client about their own insurance coverage: “By the way, do you have a similar plan in place?” If not, then this transitions to a straightforward pitch. If they do have a policy, the caller then asks if they can help review the individual’s existing plan for opportunities to maximize their coverage or save them money. Fournier recalls that he has never had anyone say no to this request.
Through this innovative approach, each conversation with a new client organically evolves into multiple value-rich discussions with the enrollee’s loved ones. These touchpoints can lead to an immediate sale or, at least, brand awareness that Fournier and his team can continue nurturing. It’s a tactic that’s applicable across industries, and you could very well develop such a tool to add to your team’s arsenal for the months ahead.
TAKE ACTION:
Consider how you can optimize the referral tactics in your organization, tracking their efficacy with detailed metrics.