While social media provides sales execs with a new way to expand the conversation about your products and services online, self-referrals of a more traditional variety are probably not going out of style anytime soon.
Still, when they are out in the field pressing the flesh with existing clients sales reps fail to take advantage of self-referrals, said Michael Pedone, founder of SalesBuzz.com, which provides sales training courses and training workshops on how to close sales by phone and make quota.
“If you ask any sales rep what their success rate is for getting self-referrals simply by ‘asking,’ and they say more than 2%, most would be lying,” Pedone said. The fundamental problem with self-referrals is that sales execs tend to put the client on the spot when asking for referrals.
“You need to back-up before you ask for a referral and think objectively,” Pedone said. “The guy is not thinking about you, and now you’re asking him to do your homework. There’s no upside for him.” By not thinking things through before asking for a referral, sales reps risk alienating existing clients, he added.
A more effective approach, Pedone said, is to get your ducks in a row prior to asking for referrals:
- Think of the companies that are related to existing clients but not in direct competition. Research business associations on LinkedIn and locate three to five people, from different companies, who are involved in the supply chain.
- Take some time to research the various decision-makers associated with your existing client and make a list.
- Try and land an appointment with one person from the group.
- If things are on the right track with the initial client mention to him or her that you noticed similar buyers (at the related companies) and think your products and services would be a benefit to them, as well.
- Ask for a referral directly or, barring that, whether you can call the other buyers directly and use the initial client’s name as a reference.
Pedone stressed that when contacting other buyers the opening statement has to be right across the plate. “You need to say, ‘The reason I’m calling is because so and so at XYZ company thought you might be interested in a conversation?’” he said. “The lazy way is to call clients from your database and ask, ‘Who do you know?’”
To read a LinkedIn discussion on how sales execs can improve their self-referrals, please click here.