How to Build a Winning New Business Referral Strategy

How to Build a Winning New Business Referral Strategy

We work with thousands of agencies – big and small – who come to us with the same question: how do I grow my business and add new clients?

There’s no way around the need to prospect for new clients proactively, but add to that a fine-tuned, consistent referral strategy and you’ll be casting an optimal net. We’re not advocating making referrals the sole driver of your business, as that’s a recipe for failure, but we do have some tips on how to optimize this channel as one of several by which you’re connecting with clients.

When it comes to referrals, you might be wondering: How do you ask? When do you ask? What do you say? We’ll cover those points, and even give you a sample template, but first, let’s discuss the benefits.

Referral Strategy Benefits for Agency New Business

  • It’s the easiest strategy to implement, with the most immediate pay-off. For the obvious reason that a referred prospect is a highly motivated buyer, the referral-generated sales cycle can be as much as 75% shorter. 
  • Reduces your business development expenses and closing cycle on your most sought after prospects.
  • Well defined and consistent strategies have higher closing rates of 70%+ within 120 days over cold-approach campaigns.

Quick Tips to Building your Referral Strategy

  1. Set your Target

In business, we measure the results to improve performance of any metric. Set clear goals with a timeline. For example, 10% increase in referral business leads over the next 10 weeks.

  1. Timing

Conventional agency business development wisdom suggests the best time to ask for the referral is immediately after the close. This tactic is far too aggressive. Give your clients time to experience your expertise, build a relationship and see real credibility before asking for a referral.

  1. Top 20

Not all clients or LinkedIn 1st degree connections are referral candidates. Find the top 20% that would be advocates of your business and ask them for referrals. Make sure their connection that you request an introduction to is exactly the type of client you’re seeking – and be specific about providing a relevant reason as to why an introduction would be of value to their connection. More on that in a moment.

  1. Give and Get

Give your top 20% referrals. Give your clients extra service and follow-up support before asking for referrals. When you give willingly to your clients and prospects, they’ll return the favor. Before you ask, make sure your current clients are motivated to pursue referrals for your business based on their experience. 

  1. Specificity

Inform your referring leads of exactly who you’d like a referral from, why it would be of value to them to meet you, and have a sense of urgency built into the ask. A key component to your referral strategy is making sure your clients are aware you want referrals and being clear about how they can help. 

  1. Surprise and Delight

Keep those who refer you in-the-loop on what the outcome is of their referral. Most agency business development people drop the ball here, and it’s a critical step to ensure additional referrals from that person. We all like to feel validated in the efforts we undertake. Then surprise them periodically, either with a referral, a personal gift or just some industry intel of value.

  1. Consistency

To be successful, you must focus on making your agency new business referral program a prioritized aspect of your daily routine. Above all else, this will be the make or break of your referral campaign’s success.

 

Now what? Well the following email/ voicemail structure has proven to be successful (when made your own) for a number of our clients, as well as within our organization.

Sample Referral Strategy Messaging Structure:

Opening: Hello.

Para 1: Ask for help, displaying trust and vulnerability.

Para 2: Confidently and specifically detail the type of help you’re looking for, and why.

Para 3: Precisely how they can help you and how easy you’ve made it for them to do so.

Para 4: Sense of urgency built into closing.

Close: Thank you.

 

Example: Digital Agency – Expertise in Connecting Brands with Gas Powered Athletes

Hi Matt,

Good to chat last week. A quick favor to ask – I’m looking to add just one, highly specific client to our agency family this year who shares the same values that we do, and I find that the greatest way to determine a best-fit and filter is through existing friends – I’d look to you for ultimate guidance on this.

If you’d be open to it, I’d love the opportunity to demonstrate our horse-power to Megan Gillam who oversees Consumer Marketing on the Ford F-150 Raptor team.

Given our experience and expertise in the space with GMC Trucks and Honda Motor Sports over the years, I hoped that you’d be open to an introduction to Megan for me this week?

Specifically, she’d find value in an initial conversation with me on the “Gas Powered Athlete” communications platform; built on our expertise of building the brands that power and sustain them.

I’m hoping that you’d be able to introduce me before next Tuesday, the 15th, as we have some timely industry knowledge that I’d like to include in our conversation. Attached is an executive overview for her review.

Many thanks in advance for your help in introducing Megan and I.

Final Thoughts and Next steps:

There’s really no need for sweaty palms in agency new business. You can remove a lot of the anxiety by simply having a plan and prioritizing it as a part of your daily routine. If rejection is a primal fear of yours, a consistently implemented referral program will ease you into proactive new business, setting the stage for you to test and refine the way in which you position the agency, and find and engage relevant new relationships with marketers.

A word of caution: having worked in the agency new business space for 20+ years, we know that a good referral strategy is an important part of your new business routine, but it can’t be the only part. We’ve seen agencies become so reliant on referrals that they ignore the need to proactively prospect, and end up missing out on opportunities to work with their dream clients. So make it part of your mix, but not your sole solution, and you’ve got a winning plan.

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