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Common Questions and Answers
Most salespeople hate cold calling. Well, the alternative to making cold calls is getting leads to come to you — in other words, referrals. Often salespeople will ask new customers for a name or two at the end of the sales call, yet these leads rarely turn out to be solid, so they give up quickly. But if you know how to ask, you can find gold nuggets in those referrals. Sales experts say that a qualified referral is six times more likely to end in a sale than a cold called lead. Isn’t that worth a little persistence?
And don’t think that new customers are the only source for referrals. In fact, they’re not even the best source. A customer you’ve just signed up is probably feeling enthusiastic enough with his purchase to want to spread the word by sharing a few names with you. But a very new customer won’t necessarily know which of those people is really qualified to own the product.
In some ways, a prospect who has decided not to buy from you is a better source of referrals. That may sound strange, but in fact many sales fall through because of factors beyond the prospect’s control. For example, he may not be able to afford to buy that particular item right now. Since these prospects know at least one way in which a person would not be qualified to buy, they are somewhat more likely to pick out referral candidates who could and would buy that product.
Of course, someone who has been a customer for a while is an even better source of high-quality referrals, since she is far more familiar with your products. Really happy customers will actually go out and sell for you, acting as unpaid salespeople and telling everyone they know how great your company is. This is yet another reason why excellent customer service is so crucial. Keep in touch with your customers, calling and emailing each and every client a minimum of twice a year (six times per year is better for most industries). Each time you make contact, start by asking how the product is working out for them. Assuming that they say everything is great, you can then say something like, “I’m happy to hear that. And if you know someone else who could benefit from this product as well, I’d be glad to speak with them and give them a little more information.”
When you look for referrals outside the circle of your customers, your network is a great place to start. Most network contacts will be happy to send you leads in exchange for same. Once you’ve established a pattern of helpful behavior, you’ll probably find that your network contacts are bringing you referrals without your needing to ask. However, if you don’t see any spontaneous action on their part, a simple email can prime the pump.
Finally, you can and should look for referrals outside of the business environment. You can get quality referrals from your banker, lawyer, dry cleaner, auto mechanic, supermarket checker, golf buddy, and anyone else with whom you come into contact. This doesn’t necessarily mean pumping everyone you meet for leads. It means that you should be open to opportunity everywhere you go. Often all it takes is to strike up a casual conversation and mention what you sell, followed by a casual, “So if you know anyone who needs [product] I can help them out.” With people you see regularly, you can add something like, “As a friend of a friend I might be able to work out something special,” with a big smile on your face.
About the author
My first sales position was a summer job selling vacuum cleaners door-to-door. I continued through a variety of sales jobs ranging from retail sales for a storage company to selling bank products for a Fortune 500 financial institution.
As a small business owner, I now focuses on selling for my own company, Tailored Content, a website content provider. I write on a wide range of topics but my primary focus is sales and how to sell effectively.