It is getting harder and harder to break through the relentless marketing and sales noise to reach new prospects.
Prospects today are finding new—and better–ways to insulate themselves from sellers.
Many of the tried and true methods to connect with prospects are becoming increasingly less effective and demand a larger investment of time, often for a much smaller payoff.
Whether you’re facing the above issues or not, aligning yourself with others who can expose you to new prospects, help set up the sale for you, and help make life more enjoyable is one of the most effective prospecting and marketing methods you can employ.
Enlisting other sellers or companies who sell to the same prospects as you to help you find and connect with quality prospects has been a staple of marketing for top producers for decades—and unsuccessfully imitated by countless others.
Why have top producers found working with other professionals for referrals to work so well while so many others have failed to capitalize on them?
I often hear sellers and managers–and even some sales trainers–talk about seeking out ‘referral sources’ to help them find and connect with prospects. These referral sources tend to be sellers or companies who are likely to deal with people or companies that would be great prospects for the seller and who might need or want their product or service.
These ‘referral sources’ discussions always interest me, so I’ll engage the seller in a conversation about their experience with them. Typically my first question will be how much business they’ve closed through these referral sources. A few will indicate they’ve done well, most indicate they’ve seen very little to no real business from their sources.
When I ask the seller I’m speaking with what the other seller gets out of making the referral, they mention that they are giving the referrer the assurance that they’ll take exceptional care of the client, allowing that seller to become more valuable to the client by becoming a trusted source of additional advice and services; or they’ll give the seller’s client a discount of some sort that only that seller’s clients get, or they’ll give the seller a cash incentive–in other words, nothing of value to the referrer.
When I assert that the other person is getting nothing of value, I often get a scornful look and verbal resistance. Some of the responses I’ve received are:
• From a mortgage loan officer: “Their client has to have a loan and I’ll make sure their client is well taken care of and gets a great deal—and that the loan will close on time. That’s real value to that Realtor and their client.”
• From an insurance agent: “She doesn’t offer insurance, just securities. Her clients need insurance and she can be assured that I won’t try to steal her clients or infringe on her business in any way and if she doesn’t help her client through me, her client is likely to see an agent that will try to steal her business.”
• From a seller for an IT service company: “I often find additional needs the client has and when I do, if he (the person who referred him to the client) sells that product, I’ll send the business to him. I’ll be a source for additional sales for him to his client.”
• From a specialized printing seller: “My referral sources are also in the printing business. Their clients will on occasion need some things done that they can’t do and that I can. My appeal to them is that by referring the business to me, they are assured that I’ll talk up just how good they are and it keeps their client from going to another company that might be able to not only do what I do but might be able to replace them as well.”
• From a management consultant: “I focus exclusively on helping companies evaluate and hire more effective employees. I look for other consultants who work in other areas who can recommend me to their clients who are having employee selection and retention issues. By recommending me, they prevent the client from seeking help elsewhere which just might be from a company who could replace them in addition to helping with their hiring and retention issues.”
In each of these cases (and these responses are the norm, not the exception), the reason given for the referral source to send them referrals is that they are doing the referral source a favor. “I’ll talk them up,” or “I’ll close the loan on time,” or “I won’t try to steal her business,” or “I’ll help them protect their relationship with their client.” The worst part is these sellers are serious when they make these statements.
Lazy, delusional thinking at it’s finest.
Why do these “referral sources” need these sellers? A promise of making them look good, or not trying to steal their business, or closing the loan on time is a dime a dozen. Actually, they’re more like a penny a hundred. There isn’t a mortgage loan officer, IT salesperson, consultant, or printing salesperson alive that isn’t likely to make the same promise. If you think you’re doing your referral source a favor and that is going to earn you their business, you’re living in fantasyland with Unicorns and Hobbits.
The first rule in developing referral business from others is that they don’t need you. They don’t need your promises, they don’t need you to make them look good, they don’t need you messin’ with their clients.
The second rule in developing referral business from others is they need business just like you. They need referrals to quality prospects, just like you do.
The ‘secret’ the top producers have discovered when getting referrals from other sellers and companies is to forget about ‘referral sources’ and develop referral partnerships—real partnerships where the referrals go in both directions, not jut one.
Sellers and companies need the same thing you need—business. If they need someone to make them look good or to help one of their clients, they have no problem finding dozens of sellers willing to help. What they need are reciprocal relationships where the people they refer clients to also refer prospects back to them. They need partners, not moochers. And if you’re not giving back in kind, that’s exactly what you are—a moocher.
Setting up Referral Partnerships
1. Identify Your Potential Partners: Look for other sellers or companies who deal with the same prospects as you. Define your ideal prospect—you may have more than one ideal—and then look for others who target the same prospect. You want to find sellers who are already established in the market; who have the reach and reputation you wish for yourself; and whose quality of products and services match yours.
There is no need to waste time and energy on low producing sellers as they won’t be able to feed you many prospects. In addition, the quality and cost of your products and/or services should closely match your potential partner’s since you will be looking for the same prospect. If your product is top of the line and expensive, don’t partner with a salesperson whose products are on the bargain end of the spectrum. Likewise, if you are selling modestly priced products, don’t think you can partner with a premium priced company to enhance your image—their clients are more than likely not going to be interested in your company’s products.
2. Know What You’re After: Once you’ve identified a number of potential partners, develop a plan of approach for each. What are you looking for with each partner—joint marketing? Maybe joint sales calls? Simply referring clients back and forth?
Take a close look at the activities of each seller or company you’ve identified to get an idea of how they operate. Do they do a lot of advertising? Are they constantly running specials? Are their sales materials high dollar—or maybe they don’t really use collateral material? Are there gaps in their offerings that you can help fill? Do they tend to sell mostly to existing customers or to new prospects?
How your proposed partner works will lead you to know what to propose to them. If they do a great deal of advertising or direct mail, maybe a joint advertising campaign would be of interest to them. If they work primarily with their existing client base, referring back and forth might be most appealing. If they use a lot of high dollar collateral material, you better have material that is equally impressive.
3. Set an Appointment with the Partner Prospect: Invite your partner prospect to lunch. Your partnership discussion is important and shouldn’t be a viewed as a casual phone conversation.
Many of your potential partners will be men and women you either don’t know or have only met once or twice very casually. Many will not know who you are. Since the men and women you’ve identified as potential partners are the best in their industry in their local market, a very effective way to gain a lunch meeting is to acknowledge their success and superior reputation. Just call them, introduce yourself, and then tell them that you know them via their reputation and the quality of their work and that you’d like to take them to lunch as you have found that it is always good practice to know top people in the business. Most will accept—people like to be recognized for their work. Seldom have I been turned down with this approach. And best of all, it’s true. I do want to know the best people in the business and they are among the best in the business in their area.
4. Make Your Proposal: During your meeting, present your proposal. Your proposal must focus on what the partnership will do for your potential partner, not what it will do for you. Sellers are people, meaning their natural interest is ‘what’s in it for me.’ If you approach the conversation from a self-centered point of view, your proposal is dead before you even begin.
If you’ve done your homework well, you should be able to relate exactly why your potential partner would be interested in working with you, what type of working relationship it would be, and what the potential results for them will be.
Since there is a very good chance your potential partner doesn’t know who you are—and possibly they know little or nothing about your company—you’ll have to be able to quickly create a relationship with them and to provide credibility for yourself and your company. Hopefully you have mutual clients or testimonials from individuals or companies your potential partner will recognize and respect.
Don’t expect a commitment during your initial meeting. Most often if the person is interested, they’ll need time to do some due diligence, as well as additional discussions to develop the model for the partnership.
5. The Monkey is on Your Back: The partnership was your idea, not theirs. That means you’ll have to do the work to get the partnership going. Even if you gain agreement from your potential partner, they won’t be committed until they see results. You’ll have to take the lead in getting the partnership moving—and most importantly, you’ll have to provide them with real leads, referrals, and potential business before you can expect them to begin feeding you leads and referrals.
If you’re just looking for free, easy business, don’t bother with a partnership because it won’t do you any good. However, if you’re willing to invest the time and effort, focusing on creating partnerships with the top sellers and companies in your area that work with your prime prospects can bring in business you would have had a very difficult if not impossible time reaching.
Partnerships are great door openers and business builders. But they aren’t magical. They take work. They take time and effort. And most of all, they require you to do what you say you’re going to do—be a source of new business for your partner, just as they are expected to be a source of new business for you.
