Blog Entry

These days, the traditional business model of focusing on one-time transactions is rapidly falling by the wayside. Instead, entrepreneurs are beginning to turn to a relationship-centered model of customer service, hoping to achieve the kind of loyal, long-term client base that can help sustain a firm through thick and thin.

When it comes to cultivating long-term clients, referrals and word-of-mouth are the most effective tools you have at your disposal. Traditional marketing methods are designed to reach out and entice new customers, and though they can be invaluable tools for uncovering new prospects, they’re not as consistent and reliable as referrals and client references.

So, how can you transform your current base of satisfied customers into a non-stop referral-generating machine? It’s simple: just ask! If you’re not already prompting your clients to spread the news about your business, you could be missing out on a valuable source of new prospects. Here are some ideas to help you encourage your current customers to sing your praises.

Go above and beyond the call of duty.  The concept behind ‘brand evangelism’ is that if you strive for out-of-this-world customer service, your customers will be so satisfied that they’ll feel compelled to shout your name from the proverbial mountaintops. It may be something of a cliché at this point, but it’s also fundamentally true: the best way to earn customer recommendations is by wowing your current clients with amazing service.

Turn kudos and compliments into referrals.  When you’re talking to a client and they feel moved to offer praise to your firm, thank them graciously—and then turn the compliment into a referral opportunity. After expressing your sincere appreciation for their feedback, ask them whether they know of anyone else who may be able to benefit from your help.

Build referral quotas right into your contracts.  Some firms make the process of eliciting customer referrals a routine part of their everyday operations. You can offer a 10% discount in exchange for a certain number of recommendations, or promise discounts, rebates, free perks, or other incentives for future referrals.

Develop reciprocal referral relationships with other complementary service providers.  If there are other firms in your area or industry that offer services or products that are a good match with your own offerings, establish a kind of “preferred provider” relationship, in which you both agree to recommend the other to customers who may be in the market for each firm’s services.

Make sure you’re feeding the referral network, as well.  The “pay it forward” approach can work wonders, whether you’re building up your karma account or trying to reap the benefits of customer referrals. Make it a point to recommend the businesses that you’re pleased with widely. Chances are, your good deed will pay off in more ways than one.

How much of your business stems from customer referrals? What’s your favorite technique for encouraging clients to recommend your firm? Tell us all about it in the comments.