That Referral Guy

TRUTH or DELUSION? Even after you receive a referral, you should put just as much effort into your referral marketing as you did before you received that referral.


TRUTH. There’s a phenomenon in sales called buyer’s remorse that we’ve all experienced, often from the buyer’s side. You’ve spent a lot of time thinking how great that SUV looks, how much of your stuff it will haul, and how much backcountry exploring you’re going to do in it. Then you buy it, and suddenly it is a gas hog, costs a hundred bucks to fill up, and won’t fit in your garage. Plus, when are you actually going to have time to drive to Tierra del Fuego anyway?

It’s the same product, but once you’ve made the irrevocable decision to buy it, you begin to regret it. The only thing that’s really changed is your attitude. Before the sale, you were focused on the pros – all the reasons that are always there not to buy. Only after you’d committed yourself and paid for the product did you start thinking about the cons.

The same is true for someone who gives you a referral. Before she does so, she talks herself into it by concentrating on all the good reasons to do it – her contact will benefit from your services; she will enhance your reputation as someone who can get things done; her relationship with you, her referral partner, will grow stronger – but she ignores the possible downside of referring you to her friend. Once she’s passed the referral to you, however, she begins to have doubts. Is this the product or service my friendly actually needs? Will you follow up quickly and deal fairly? Will my friend be happy with the result? Will you be able to make the sale? Will my relationship with either of you suffer? Maybe this referral was a mistake.

She could, of course, be one of those referral givers who give “good luck” referrals: “Here’s the referral, best of luck to you, I’m outta here.” But this attitude only leaves the referral giver vulnerable in case the transaction doesn’t go well. It may keep her from getting worry lines, but only if she’s concerned with just the immediate transaction and not the future of her referral-networking relationships.

Assuming she’s a conscientious referral partner and wishes to keep your relationship strong, you need to follow up with her so that she doesn’t suffer from referral remorse. As soon as possible after you’ve made contact with the prospect, inform your source that you’ve done so, and tell her how things are going. Give her regular updates. Ask her to tell you if the customer is in any way dissatisfied, then handle the problem immediately and cheerfully.

Let your source know how grateful you are for the referral; send a handwritten thank-you note or buy her a nice lunch. Send her a referral fee promptly if that is your understanding, or send an expensive personal gift you know she will like. Look for opportunities to steer business her way. Even if the referral doesn’t result in business for you, let her know the circumstances and assure her there are no hard feelings. If she is happy that she gave you the referral, she will be eager to give you more.

Automobile manufacturers want you to be happy with your purchase; they know you’ll be thinking about buying another car in a few years, and they want you to come back and buy their brand again. They combat buyer’s remorse by continuing to market to you after the sale to remind you of the reasons you of warranty-covered services; they conduct owner surveys to show that they’re concerned with your satisfaction; they let you know about owners’ clubs and special events for your brand. By doing so, they validate your decision and reinforce the positive reasons you had for buying.

As a referral networker, it’s in your interest to see that a referral you give works out well for both the buyer and the seller, that they are communicating well, and that both of them are aware of the benefits. Your primary interest is not in making a one-time referral but in strengthening your existing relationships so that they will generate many future referrals, both for others and for you.

Now here’s the other side of the coin: as the referral receiver, you, too, can experience referral remorse. The business that results from a referral may not be nearly as good as you were led to believe; the prospect may try to skin you because his friend referred you; representations may have been made that you weren’t aware of. A conscientious referral giver, aware of this type of referral remorse, will follow up on her own to see how her referral worked out for both of you. After all, if either of you – the referral receiver or the prospect – embarrasses her, that will influence future decisions about referring either one of you. She doesn’t want to encourage referral relationships with people who will only weaken her network.

To keep your relationship healthy, tell her right away how the first appointment went, then provide regular updates. If misunderstandings arise, let her be the first to know so she can do her part to repair them. Your forthrightness will reassure her and damp down the fires of her referral remorse; conversely, her interest in the referral and willingness to stay involved will tell you much about her integrity and her concern for others and will influence your own decisions about when and how to refer her to your contacts. Does she care about the referral she just gave you, or is it such a low-level relationship that she doesn’t care if you blow it?

The work doesn’t end after you’ve passed or received the referral.

            These follow-ups are almost never done, but the few people who do them effectively have a distinct advantage over their competition. They are making sure their relationship is a two-way relationship. They work doesn’t end after you’ve passed or received the referral; the way you follow up can make all the difference in the world in how effective your network becomes.

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