My April 9, 2001, Weekly Tip dealt with getting referrals from clients. Last week, on a list server in which I participate, a subscriber asked, “When I get referrals from clients, how do I handle them?” I figured my answer would make a good follow-up to the previous tip, so here goes.

While you may get referrals from many sources, I’m going to deal specifically with referrals from clients, because the nature of your relationships with your clients adds an additional dimension to the equation. However, most referrals can be handled similarly.

When your client (“Joe Client”) gives you the name of a colleague (“Sharon Prospect”) and says something to the effect of, “You should call Sharon Prospect. I think you could really help her.” You must consider that, even though it’s a referral, there is still only a small chance that Sharon actually wants and needs right now the services you have to offer. So, unless you’re focused on the right objectives, you can easily end up wasting a lot of sales time.

To ensure that your time is not wasted, and to get the most benefit from the referral, don’t think of it as a “Right-Now” business lead. Instead, think of it as a relationship-building opportunity, and take actions based on the points of view of the three people involved:

1. The client making the referral  

2. The person to whom you were referred  

3. You

You should bet on the fact that Sharon and Joe will speak in the future, and that Joe will ask Sharon whether you contacted her ... and how. So unless you want Joe to think you don’t value the help he is offering, you must call Sharon and tell her that Joe referred you.

Sharon, however, may or may not be expecting your call and probably won’t want your services right now. So the first call should be about making Joe happy and about starting your relationship with Sharon. 

You: Sharon Prospect, please.

Sharon: Speaking.

You: This is [your name], with [your company]. Joe Client and I have been working together to [describe the primary result of your involvement with Joe’s company], and Joe gave me your name as someone who might want the same types of results. However, he really didn’t describe your situation in much detail, so I figured I’d just ask you what you thought he might have meant.

Then talk to Sharon to see what she thinks of Joe’s having referred her. Ask her the types of questions you’d ask someone who saw your website or ad, and called you to see if you could help with the problem at hand. Find out what Sharon wants, if anything, and find out whether she qualifies for an appointment the same way you ordinarily would. (Don’t go on a sales call with Sharon, unless she is ready to do business.)

If Sharon does qualify for an appointment, ask the same conditional-commitment question you would when setting any sales appointment: “When we meet, if what I show you meets your conditions for a successful project, what will you do?”

In other words, you treat Sharon the same way you would any Right-Now prospect. Unless she conditionally commits to doing business, do not go on a sales appointment. (Of course, I do go on informational lunch appointments with people whom I consider good prospects, but who are not ready to do business right now, because good relationships have long-term value.)

Immediately after your conversation with Sharon, send Joe an e-mail or call him. Thank him again for Sharon’s name, and tell him what occurred and what, if any, future plans you and Sharon made.

Here’s the result of this type of first-call approach:

• You let Joe know that his time and referrals have value, and you will gradually increase the quality of the referrals he gives. For instance, suppose he refers someone who says, “I have no idea what Joe means.” When you tell Joe that, he’ll most likely realize he wasted your time and have the incentive to improve the referral quality in the future, which will result in better opportunities for you. It may also open the door for you to explain to Joe a little more about what you do, and who your Right-Now prospects are. This, in turn, makes it easier for you to cross-sell additional services to Joe, because he actively took an interest in what you do.  

• You start a relationship with Sharon, and you let her know that Joe is thinking of her needs, which strengthens Joe’s relationship with her as well.  

• You don’t waste any of your time, because you don’t go on the appointments unless Sharon is ready to do business. Another benefit is that your credibility with Sharon is increased over what it would have been if you had contacted her cold through telephone prospecting, a business letter or some other marketing activity.

Remember, your primary reasons for calling are customer service – respecting Joe’s thoughtful referrals – and relationship building. By focusing on these objectives, you’ll eventually “train” your clients to spot Right-Now prospects on your behalf.

Have a great week!

Gill