Two Definitions Everyone in Business Should Know

IN MY WORK as a sales consultant and sales trainer, I am always probing for certain bits of information. I compare the responses I receive to what I would expect to hear and see in a healthy business.

I guess you could say I act like a physician who specializes in sales and marketing. I diagnose my patients, based on a series of questions – using hard data for my thermometer, stethoscope, and blood pressure monitor.

I guess you could say I am a physician who specializes in sales and marketing. I diagnose my patients, based on a series of questions – using hard data for my thermometer, stethoscope, and blood pressure monitor.Click To Tweet

Thinking about referrals

Here’s an example:

When I ask a new client or prospect where most of the new business is currently originating, larger and more established companies normally respond with an overview of (at least the makings of) a reasonable marketing plan.

Younger companies (and a surprising number of professional practices), however most often say, “Through referrals.”

My next question is “Do you mean referrals from those who have already worked with or purchased from you?”

But, the normal respond is, “Well … actually from family and friends who know about my business.”

Every time I get that reply, I no longer wonder why my that person is unhappy about low or no sales and why business is not growing as quickly as hoped.

Your family and friends are certainly of great value in your life, but expecting them to do your marketing for you is almost always a sure-loss proposition.

The two kinds of word-of-mouth-referrals

When you think about referrals, imagine them in two buckets. The first is FLAT referrals, and the second is ACTIVE referrals.

  • Flat Referrals: This is most prevalent in new businesses, smaller businesses, and solopreneur service professionals. Flat referrals are a form of marketing based on networking via existing relationships or one’s circle of friends.

The underlying issue is this: Sales are determined by the people you know and how relative they are to your business. As in the case with my friend who wants to sell her home, the person your friend knows may not be the referral you most need.

  • Active Referrals: This strategy is based on referrals solid enough to be excellent groundwork from which to build a testimonial.

A testimonial is social proof of the authenticity and capability of a particular person or business.

As you may already know, testimonials are a powerful way – when properly positioned – to eliminate the high-pressure feel of sales. Testimonials allow the relative ease of a trust-based approach to sales.

Referrals are testimonials directed to specific people.

When properly positioned, testimonials can eliminate the high-pressure feel of sales.Click To Tweet

You’ve heard it before – because it is VITAL

Testimonials are collected and disseminated from clients or customers who are well enough satisfied with your products and services to want to help spread the word about you within their networks, so others can experience the same solution(s) and/or benefits that your service or product afforded them.

Testimonials are the essence of word-of mouth marketing. To grow your business, you need a solid sales and marketing strategy that allows you to make sales outside of your own network.

You may have heard that REFERRAL MARKETING is, perhaps, the best form of marketing. That is why most people consider it to be their first-employed marketing tactic.

They assume that little personal effort to market themselves is required – since the good news about their products or services will spread by way of one friend or family member telling another.

Referrals that arise from existing relationships carry less credibility than those provided by customers and clients. Click To Tweet

That is an incorrect assumption

Referrals that do arise from existing relationships carry less credibility than those provided by customers and clients. The former are more about you as a person, while the latter are more directed at your ability to deliver products or services to help achieve a goal or solve particular problems.

Does that make sense?

When customers and clients buy from you, or work with you in a professional relationship, then enjoy a favorable experience as a result of using your products/services, the value of your brand increases.

This, friend, is why I am an avid believer in the value of a trust-based sales approach. The very essence of the sales approach I teach builds trust … and trust is fundamental to building relationships.

When you learn trust-based sales/communication skills AND combine them with value-driven products or service, your sales can soar … because people will indeed like you (and YOU will like YOU because you’re comfortable and confident in the sales process) AND they will love your brand (business).

When you learn trust-based sales and communication skills, your sales can soar.Click To Tweet

It is this positive experience with your products or services that satisfied customers talk about within their own networks, thereby leading those people to buy from you too.

They buy with an expectation in mind: to enjoy the same favorable experience enjoyed by the person who referred you.

Depend on your friends – but not for your marketing

Now, I am certainly not saying that referrals generated within your own close circles are not valuable. You never know where that next excellent lead will come from.

What I am saying, though, is “Don’t stop there.” Think about ways to gain testimonials and referrals from those who have experienced your services or products.

Those are golden.

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