Call me old fashioned, but I think nothing beats referrers as a source of new work. After all, the cost of acquiring new business is lower, the lead times usually shorter and the resulting relationships stronger than when you acquire new clients any other way.
But referral relationships are complex and, if you get the unwritten rules wrong, your sources of work can soon dry up leaving your practice exposed and even precarious.
So, are you a referral cultivator or a cul de sac? Here’s the short guide to finding out.
The platinum rule of referrals
The golden rule in life is that you treat others how you’d like to be treated. The platinum rule is to treat them how they like to be treated.
And never has it been more appropriate than when someone refers you work.
Whenever you receive a referral, always start by asking the other person what their expectations are and how they want to be involved. For instance, do they want to come along to the first meeting? Do they want to be included in any correspondence? Or are they happy just to introduce you, then dust off their hands and get on with something else.
Whatever they want their level of involvement to be, make sure you comply.
Share your intelligence
The best referrals happen when the referrer and referee know everything there is to know about each other and the potential client.
So find out the exact nature of the relationship between the referrer and the client. And ask them why the client is looking for someone. Their answer to this question will have a dramatic impact on the way you pitch for work. Have they sacked a series of providers before you? Have they never previously had a provider with your expertise? Or are they looking to just expand their roster?
Let the referrer know how you want to be positioned, what expectations you have from your end. (Without being demanding, of course). And be prepared to share examples about how you work with other referrers.
I even think that you should go so far as sharing both how you bill and your likely fee range.
Because the person doing the referring needs to know what they’re telling someone else to buy. And, if they also receive part of the client’s external spend (eg if they’re an internal referrer), they need to know how introducing you might potentially affect their billings.
Shine the spotlight on the referrer
In case I haven’t been clear enough yet, I’m telling you that your referrers are the lifeblood of your practice and your key to future growth. So treat them like they’re the superstars that they are. Shine a light on them and roll out the red carpet whenever you can.
The way we do that here at Prodonovich Advisory is through what we call the ‘Veuve Exchange’. When someone sends work our way we send them a bottle of Veuve Cliquot. We put another bottle of Veuve in our fridge. Then, once a month, we invite our referrers to our place to meet each other and drink the champagne they’ve earned.
Nobody’s complained yet!
But beyond that, make sure you recognise your referrers publicly. One firm I know of has its CEO recognise every referral personally in a firm-wide email every time there’s a new win. In other words, they don’t just slap each other in the back for gaining new business, they recognise the real source.
Clarify your position on on-referrals
By an on-referral, I mean the situation where someone has introduced you to a new client and that new client introduces you to yet another. Referrals are complex enough; on-referrals bring with them a whole new level of complexity again.
There’s a range of views out there about how long you should let people know about on-referrals. Some people think you need to do it for the first 12 months of a relationship; others think you don’t need to do it at all.
My view is that there’s no such thing as over-communicating. You should keep telling the referrer about any on-referrals until you’re told to stop. People always like to be thanked.
Thank you really is the hardest word
Speaking of which, just the other day I received a thank you call from someone I’d referred to a new source of work and who’d been on-referred. It absolutely made my day… not least because I gave the referral three years ago.
Some of you might find that whole scenario a little awkward. You shouldn’t. If you don’t know how to say thanks, you can see my guide to doing it the right way here.
And, once you do feel confident enough to say thank you, do it right away. Pick up the phone and let your referrers know what they mean to you now.
Because put simply a good referrer is the gift that keeps on giving.
Sue-Ella is the Principal of Prodonovich Advisory, a business dedicated to helping law and accounting practices sharpen their business development practices, attract and retain clients and become more profitable.