GROW BY REFERRAL


You could break your small business bank account on flashy advertisements. Or, you can follow the lead of successful entrepreneurs who know one sure-fire marketing tool: there’s no shame in simply asking a friend to tell a friend.

Word-of-mouth campaigning is a cost-effective way to keep clients ringing your phone, and it forces you to run a tight ship, experts say. In essence, you’re encouraging your happiest customers to create a buzz about the quality of your services. How hard is that? Well, it’s an easy art form that many companies simply haven’t mastered.

“Typically, less than 10% of businesses have a systematic formula,” says Los Angeles-based Joe John Duran, a chartered financial analyst, whose book Start It, Sell It & Make a Mint (John Wiley & Sons; $19.95), reveals the top 20 secrets on how to grow and sell a company. By interviewing dozens of successful entrepreneurs, Duran realized that a majority, including himself, flourished with the help of referrals. “Referrals are the cheapest way and most effective way [to grow a company],” says Duran. Yet, the discomfort associated with asking for help prevents businesses from enjoying the growth they deserve.

That isn’t a problem for Mia Jackson, president of Doro Marketing based in North Bethesda, Maryland, which produces marketing materials for companies and nonprofit organizations. When she launched her firm in 2000, she counted on friends and former colleagues to chat up her services. As her clientele grew, she began asking her favorites to pass along her name and card to others in need of her expertise.

“If you don’t have that word of mouth, it’s very seldom a brochure will get you the clients you want,” says Jackson, who landed her largest client when a woman she once worked with suggested Doro for a marketing project. “With professional services, you really have to rely on that referral.”

How can you get in on the action? Shed your pride and implement a referral system that suits your business, but includes the following strategies.

First, identify which of your clients are willing to help. Select clients who like working with you, are satisfied with your work, and take pleasure in helping people.

Second, find a nonthreatening way to ask clients to drop your name to their associates. One subtle approach is by sharing with the client how vital word-of-mouth advertising is to the growth of your business. Let them know that you cannot be successful without their help. Some business owners even go the popular route of offering incentives to customers who bring in new blood.

Lastly, Duran suggests that business owners remember their helpers by sending a personal, handwritten thank-you note or a small token of gratitude. Avoid zipping off e-mails, he says, which can come off as impersonal.


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