5 Ways to Build Your Referral Network

BNET TalkbackShare your ideas and expertise on this topic

Subscribe to this discussion via Email or RSS

•  
  1

  IanP2

  05/15/09 | Report as spam

  RE: 5 Ways to Build Your Referral Network

  As someone from the buying community just learning to sell then here is my two-pennyworth on the subject.
  1) Cold callers far too often fail to research their targets effectively and end up lost, never finding the key contact in a business. I usually give them contact names if they got through to me but the appropriate buyers were rarely contacted. Far too often cold-callers are poorly trained and clearly reading from a script. Cold callers are generally too willing to be put off and lack the confidence to pursue initial contact throuh the 'no' phase. Quite often cold callers were trying to sell to the wrong industry. I still get calls from medical suppliers trying to sell me electronic equipment that is just not suitable.
  2) I have a tendency to distrust referrals, far too much of the old boy's or old girl's network inherent in doing busines this way. I come from a defence background where this sort of approach is close to corrupt practice and rightly frowned upon. Referrals always came across as somewhat arrogant, expecting business because of their 'personal referral' to someone up the chain, who may simply have diverted them to me to get them off his back. The CEO or CTO may be the right person to approach in a medium sized enterprise but in large companies with well trained and managed supply chains the procurement teams are generally highly professional and treat salesmen referred this way with caution.
  3) Probably the best approach nowadays is seen from 'warm callers' who have picked up on internet traffic as buyers research the market or bought contact lists from trade e-magazine suppliers. These guys (and they largely are men) have invested money and time in the right tools and are usually reasonably well trained and briefed in their target customers. They spend time learning about the industry and prospect before they make contact and seem to make the buyers job easy. Usually the caller is different from the face contact we see at first meeting, so I guess they specialise in the role.
  4) Different to 2 but usually coming through a similar route are those salesmen and women who think that 'building a relationship' is a key part of selling to large organisations and spend lots of quality face time trying to find out about your sick dog, aged aunt, favourite football team or whatever. These are usually 'beautiful people' and they elicit a groan response from me as they waste so much of my time and achieve little. I want to deal with people who can help me to improve my product or reduce my costs, not someone who looks great but just adds drag.

•  
  2

  DeniseCorc

  05/16/09 | Report as spam

  RE: 5 Ways to Build Your Referral Network

  I agree with IanP2 about his #4 that building small talk is not only a waste of time. It can actually backfire and lose the sale from the get-go.
  
  One of my specialties is human behavior and the underlying psychology that drives it. That includes what drives buying behavior. In my experience of working with sales people, most miss the boat on what it means to build "rapport" with prospects.
  
  It's not about making small talk. True rapport building is knowing how to uncover your prospect's underlying buying motivations, criteria and decision making process ... the way they think, their personality structure and process info ... how they view the world ... what makes them tick. then using that info. and languaging your offer in ways they can "hear" it and in ways they actually buy.
  
  If a sales person does the right research not only on the company, but the actual decision maker, and begins to "read between the lines" what makes this person/company tick, they will shorten the sales cycle, close more sales and create strong loyalty ... guaranteed.
  
  The other skill I find most sales people lacking is knowing how to ask the right questions ... and when to ask each ... to manage the sales conversation to a close.
  
  My last comment is about one of the remarks Jeff made above -- using the post sale conversation to describe the actions you will take to win your customer's trust. While I like the thinking about focusing on customer trust, I disagree with "how to get there."
  
  For one thing, "trust" is too vague and abstract of a term. What wins trust for one person may be different from another. Saying what actions you will take to earn trust is making alot of assumptions that you know what will earn trust from that customer.
  
  The other is ... you can't close a sale without winning customer trust. And how you do that in the pre-sale conversation has to do with what I was referring to above about how to build real rapport.
  
  I do agree that earning trust must be maintained continuously throughout the customer relationship - pre and post sale. It can never be taken for granted.
  
  Denise Corcoran
  The Empowered Business (tm)

•  
  3

  joannesblack

  05/17/09 | Report as spam

  RE: 5 Ways to Build Your Referral Network

  Hi Geoffrey:
  
  Thanks for starting a referral-selling discussion.
  
  Current clients are a great source of referrals, but we need to ask them. So often we think that if we've done good work, they will automatically refer us. Sometimes they do, but I only count on sales that I bring about. Our clients are off running their business, and we're not necessarily 'top of mind' for them.
  
  I do agree with Jeff Gitomer that it's great when prospects call you. I'm even more proactive and ask my Referral Source to contact their referral and let them know I'll be in touch. Works every time.
  
  Regarding what Ian wrote, relationships are always important, but clients will refer you because you've delivered results. You've made a quantifiable impact on their business.
  Working with procurement is not where those of us selling services want to be. Our clients are executives who will make the decision to buy. Why will executives meet with a salesperson? Research shows #1) the salesperson has been referred by someone in the executive's company and #2) the salesperson has been referred by a trusted resource outside of the customer's company.
  
  There are multiple sources of referrals available to us--not just our current clients. These are totally under-leveraged. You can read my newsletter, Get In and Get Started here http://www.nomorecoldcalling.com/newsletter0209.html
  
  I agree with Denise that building trust is critical--from the first meeting throughout the sales and delivery process. Among the great benefits of referrals, building trust is the first. When we're referred and introduced, we have trust and credibility with the prospect. That sets the stage for a remarkable relationship. We're on the same side of the table with the client--working together to solve a business problem.
  
  

•  
  4

  tj14

  05/18/09 | Report as spam

  RE: 5 Ways to Build Your Referral Network

  I agree that building a relationship with Procurement is a waste of time. If Procurement's involved you're in the wrong place. Especially if you sell services, intangible or have IP as a differentiator. Their job is to make everything a commodity and to hammer you on price.
  
  Denise and Ian mention tools. A list of them would be quite useful!

•  
  5

  IanP2

  05/18/09 | Report as spam

  RE: 5 Ways to Build Your Referral Network

  To tji4
  Sorry I don't have a list of internet information tools, but there are a lot out there.
  In response to your other point.
  A good procurement department doesn't commoditise anything, rather the opposite.
  I always trained my teams very specifically to;
  1 Understand the role of the business they worked for and what it needed from its procurement community.
  2 To identify and promote those potential suppliers who were capable of growing with us as partners. (IE they had the right management and ethic skill-sets, a sound financial base and a product / business development strategy).
  3 To educate and encourage development in those areas where the supplier was wanting.
  4 To look for product utility - what the supplier offered should enhance the our product appeal to our customers
  5 To specify quality, delivery and lastly price in the negotiations, very specifically in that order. Why? Because if their quality wasn't up to standard when it was JIT delivered then our production lines stopped within days or we built poor quality into our product - totally unacceptable to us. If delivery was late then again this cost us time and money as we slowed our production or delivered our product late. Price was the trade off. I am always willing to pay to get quality / on time delivery.
  6 To encourage salespeople into the business and deal with them ethically, openly and fairly at all times - because today's little man is tomorrows industry leader when he gets his break and if you close your doors to new people you will never know what you missed.
  
  Not the norm in purchasing across the globe but a key part of making our business world class in every sense.

•  
  6

  bluebanana20

  05/19/09 | Report as spam

  RE: 5 Ways to Build Your Referral Network

  If you still feel bad about asking for referrals, when you send your handwritten "thank you for doing business with me" card, add a note asking for referrals in there too.
  
  Very personal.

•  
  7

  upshift

  05/20/09 | Report as spam

  RE: 5 Ways to Build Your Referral Network

  I am in the process of changing careers from B2B technical
  sales /applications to Supply Chain, with a focus on
  purchasing.
  
  One of the reasons for the career change is the
  professionalism of Supply Chain in many organizations.
  
  Both responses from IanP2 are, in my opinion, not only valid
  but very important.
  
  One possible "rule of thumb" to judge the professionalism of
  the procurement group is the time frame of reference that
  the group or individual in procurement has responsibility for.
  
  If the conversation is only about Price and Delivery, today
  then, yes one needs other contacts in the organization.
  However if the time frame is longer then procurement knows
  and communicates with all of the key stakeholders and will
  advise you accordingly.