Where is your next customer coming from?
Salespeople and business owners are always contemplating how to market and attract customers. With the growth of social media, many of us have used these tools and platforms to promote our businesses. The challenge is being able to measure their effectiveness in helping us to engage our community and successfully sell our products and services.
There is a very easy and simple way to measure the value of your marketing dollars spent to advertise your product or service, and that’s by implementing a referral-based system. Allow me to explain.
Friends and Family Rewards: A Case Study on the Effectiveness of Referrals
I’m working with Canadian-owned, Niagara-based company Friends and Family Rewards to help them manage their growth. They are absolutely killing it, and their genius is so simple and effective that it sounds too easy or too good to be true. I was doubtful at first, but I have found their sales and referral system works every time if you follow their formula.
As many of you know, I am big on research. In my soon-to-be-published book Image is Everything (June 2018) I have backed all of my work with scientific facts and research. Friends and Family Rewards is also a research-based organization. They have studied marketing practices, buying behaviours and selling methods to create their referral and sales system. This is where the simplicity comes in. Bain, McKinsey, and many others have published research that states the following:
• Focusing on your existing customers is the best way to find your next profitable sale
• The first 90 days after a sale is the “honeymoon phase”. They are excited about their purchase and love to talk, promote or advocate on your behalf.
• Referrals are the most profitable and quickest way to sell your product or service
• Compensating customers incentivizes them to provide a referral, and it’s a great way to thank them for the referral
• 80%-90% of just sold customers WILL provide a referral if asked
• 5 to 11% of sales people DON’T ask
Referrals work well for all businesses, but most especially for high-ticket sales. Friends & Family Rewards concentrates on word of mouth, which is still the most effective way to sell. I’ve seen it and I believe in the effectiveness and profitability of referral selling.
Friends and Family currently partners with clients who manage car dealerships, mortgage companies and real estate agencies. They are expanding into boat and motorcycle sales and growing into New York State and Pennsylvania. Genius!
In an effort to manage our growth, I am hiring an Inside Sales Account Representative. If you are interested please send your resume to Barbara@ImpactandPerformance.com