How to Start a Successful Referral Relationship

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Having a referral partner is one of the best assets you can have in today’s business environment. When someone you trust sends leads your way, the opportunities to increase revenues and expand your clientele rise exponentially.

When you can do the same in return, the two-way street created by this referral partnership makes a rising tide that lifts everyone.

The problem that most partnerships develop after the first few referrals involves a lack of structure. Unless there is a clear plan that lets you communicate regularly with your partners, the system starts breaking down.

You also need to have a plan available that lets you meet new partners regularly.

If you schedule at least 45 minutes each week to meet new potential partners or strengthen your existing relationships, you’ll find that these relationships can be some of your greatest assets!

Checklist for Developing or Maintaining Referral Relationships

The other primary reason that referral partnerships fail is due to templating.

When you template a relationship, it means that you treat each partner the same as every other. This cookie-cutter methodology might seem like it saves time, but it eventually causes the connection to falter.

Everyone has unique strengths that they bring to each relationship. No two partnerships are alike!

That’s why it helps to follow this checklist when you’re working on developing or maintaining these relationships.

1. Identify multiple categories.

Each industry has multiple contact spheres that let you maximize your connections. When you can identify these relationships, you’ll create natural referral opportunities. The goal should be to find the agencies or people that supplement what you can offer to customers instead of being direct competitors.

2. Ask your customers for introductions.

Although it is helpful to attend networking events, the best source for new referrals is almost always your existing customers. When clients see positive returns from their interactions with you, the experiences they have become a recruiting tool that can lead to more sales opportunities.

When customers vouch for you, it’s one of the best referral opportunities you can have in the modern marketplace.

3. Provide an authentic value proposition.

When you have a potential referral partner, the goal should be to determine what value you can offer them. Instead of looking for ways for others to serve your needs, think about how your contributions can grow another business.

It could be through introductions, new ideas, consulting, resources, or existing connections. Once you can show that your side of the relationship has value, the potential partner will do the same.

4. Look at your business chemistry.

Although it would be nice for every referral partnership to work out, some businesses don’t connect because of ethical, moral, or functional differences. Some people don’t get along with others. You might not like interacting with them, and the reverse could be true.

If you wouldn’t do business with the person or company you’re looking at as a referral partner, it makes no sense to foster that relationship.

5. Explain your unique sales proposition.

Your referral relationships want to know how your processes, services, products, or perspectives are different than the rest of your competitors. What makes you stand out as an industry leader? Those differences provide a diverse view that offers a lot of value to the partnership, but it is up to you to outline what those options could be.

6. Reflect on yourself.

The most effective way to become referable to others is to show them your entire value proposition. Walk the potential partner through what you offer, even if it takes multiple meetings to complete the process. When they see how much you bring to the table, they’ll feel more comfortable sending people your way.

Some people expect a referral partnership to be a quid pro quo system. Just because you’ve sent referrals to someone doesn’t mean a favor needs to be returned. Your partner must have confidence in what you’re able to provide for them.

7. Discover the ideal customer for your referral relationship.

If you think your referral partnership wants to develop a reciprocal relationship, it is up to you to determine who their perfect customers would be. When you see what a good prospect is through their perspective, it is much easier to find the leads to send in their direction.

Some referral partners don’t expect reciprocal leads. Sometimes they want a resource available to keep their branding at the top of the client’s mind.

8. Talk about your ideal customer.

Another reason why referral partnerships fail is that you haven’t communicated how to recognize your ideal customer. How do you define an excellent prospect? When you share that information, the results you achieve will become more consistent.

If you don’t know who your ideal customer is yet, think about the type of person who shops with your company regularly. What traits do all those people have in common? Once you can identify that information, you can develop a shareable demographic profile for the rest of your network.

9. How do you want to be introduced?

You want more than a word-of-mouth referral when you develop a partnership. How do you like to connect with your best leads? If you share this information with each partner, it’ll provide the consistency you want during that initial discovery period.

If a company introduces you in an unfamiliar way, the first impression from your qualified leads might catch you off-guard. A potential customer might have unreasonable expectations of this interaction because of how your referral partner set them up.

That’s why it is crucial to have consistency in this area.

10. Think about how often you should meet.

A productive referral relationship requires ongoing communication to be an influential asset. Both parties need to remain referable in the view of the other. Just as you want to make sure you meet your partner’s expectations, they should also be doing the same for you. You don’t need to meet daily or weekly to achieve results. A monthly or quarterly get-together usually works well. Once everything gets established, some meet once or twice per year.

Is It Time for You to Develop a Referral Partnership?

We need relationships to find great business opportunities. Customers don’t appear magically. They come to each product or service because it seems like the best solution to meet their needs.

When you have a referral partnership that can show interested leads how your brand can solve pain points efficiently, it sets the stage for growth.

It is up to you to develop these relationships. You must be proactive about forming connections! When you take the time to build this resource, you’ll find that it is often easier to build your brand, expand revenues, and reach your current goals.

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