3 massive mistakes I made in building a referral based business and how you can avoid them
3 massive mistakes I made in building a referral based business and how you can avoid them
If you have ever received a referral, no matter how small, I am sure, like me, you felt a sense of pride and excitement that somebody felt your product or service was worthy of being referred to another person’s inner circle. I love referrals and have built several businesses based on them. But as the saying goes, if I knew then what I know now….. You get it, so to help you avoid making the same mistakes I made, here are the 3 BIGGEST mistakes I made in referral generation and how you can avoid them.
Premature solicitation
I love this term, the cheekiness of it always gets a laugh, but it's no laughing matter. Premature solicitation means that you are asking for business before people are ready - or willing, to trust you and hence refer you.
Let me give you an example but before I do I want to say upfront that over the years i have been guilty of versions of premature solicitation and have learnt how not to get caught in this trap.
Anyway, no doubt you have been at a networking event and there’s another person there who you vaguely know and they know you enough to know that you know people they would love to build a referral relationship with.
So you’re standing there and this person comes over and greets you and strikes up a conversation. You really don’t know them, but you’re a decent sort of a person and you like getting to know people - which you think you’re doing through polite, easy conversation.
Then bang, out of nowhere they ask you to introduce you to one of your close inner circle connections and try to get business out of them. Or even worse, they ask you to do business with them.
I’m an experienced networker and quite comfortable in most situations, but to this day this is still something I find difficult to navigate out of. I mean, we hardly know each other or worse, you’rre asking to do business with me already.
Several years back I remember a member in BNI who I knew reasonably well took premature solicitation to an even higher level. I knew this member well enough and I knew his business, but I had never really warmed to him. There was always something just a touch off for me, but he would never have known because I’m a professional.
So whilst my businesses meant that I had regular dealings with him, we were never close or had even been in a one to one meeting previously.
This member had decided he wanted to be a life coach and flew off to the US for training and the day after he returned he called me and after a few minutes of pleasantries, blurted out “I know you’re not happy in your life and I have the training to help you get out of your own way. My new programme is $xxx per month, when do you want to start your first session?
I was gobsmacked and seriously offended. Firstly, I don’t think anyone who doesn’t know me could make any judgment on my state of being (which I believe he was quite incorrect on) and secondly, I felt like I had just been slimed!
At no point had I offered up the opportunity for this guy to discuss with me my life circumstances nor did I feel he was right.
I managed to extricate myself from that conversation - to be honest I can't remember how because I was so shocked by his approach. But to this day I have never had anything to do with him again.
Now his programme may have been amazing and maybe his process could have elevated me to higher levels, but that was never going to happen with that approach.
Now just as a footnote, he no longer runs that programme at all. I dare say because he approached people this way and got different iterations of my reaction.
The point here is, you cannot ask for business unless you are in a trusting relationship with someone. If you cannot read the social cues of those around you, rejection is bound to continually happen and like my example above, your business will ultimately fail.
You may be saying at this point that life rewards the brave and if you don’t ask you don’t get and I absolutely agree with that assertion. However, there are many much more professional ways you can open the door on a conversation.
For example, if the member had said to me “I’m working with a new programme and I have seen some great evidence that it significantly helps many people in similar situations as yourself. I’d love to have the opportunity to share with you some of the findings and give you a free one to one session” .
Now I’d either say “not interested” or I’d open the door for further conversation. Either way, I wouldn't feel slimed and he’d know exactly where he stood with me. Even if it was a no, he could always leave the door open by offering to invite me to a free session at a later date, or maybe show me evidence on how he’d helped someone I did know, like and trust.
Bottom line is, be smart about the way you go about asking for business and referrals. Pick your moment, offer your language and think about what level of trust you are in with the person you are talking to. Pick up on social cues and always respect the other person's response.
Lack of clarity
I believe the number one problem businesses have is lack of clarity. Lack of clarity in theri purpose, their product or service and more often than not, their Target Market.
For years I lacked an understanding of why I was doing what I was doing. In my role as Executive Director of BNI Melbourne Central, it took me several years to get very clear on why I was doing what I was doing. I had always been attracted to the business and knew this was the right place for me, but I had never really worked out why and certainly couldn't explain it succinctly if asked.
Today I crystal clear why I am in business - both BNI and my training programmes. I have a certain body of knowledge that I know can help small business owners avoid making the same, costly and time consuming mistakes I have made. Every one of my gray hairs is a result of experience and I am super proud of this. Hence why I am on a mission to help small business people avoid the mistakes I have made and support them in building a business that serves them and the life they want.
Once I got very clear on that, everything started falling into place. When s#*% happens (and it does and always will in business - sorry for that reality check) I can push through and resolve things because I know exactly who I am here to serve and why. I love serving others and this has been a part of my life since I was a student and worked in a 5 Star hotel and learnt the art of serving others - one which I am very proud of and has shaped the person I am (but that's a story for another day)
On top of gaining clarity in my why, when I finally learnt to set goals for my business and personal life (something I had dabbled in for decades but never mastered) stuff started to happen. I am living empirical evidence that setting a clear point to aim for makes quantifiable differences in your circumstance.
Armed with this clarity, when I talk to my inner circle of referral partners I can easily articulate why I do what I do and more importantly where I am aiming for. When others know your what and your goals you’ll be amazed who willing they are to want to support you in getting there as quickly as possible. If you don’t have an inner circle to share this information with, chances are you need to invest in building your network.
Once you have a level of clarity, you can then start explaining who you want to do business with and why. If you can't explain with absolute accuracy who you want to work with and how you will help them, your referral partners will never be able to help you.
All too often I hear people say they get ‘crap referrals’. The only person responsible for the quality of referrals that come your way is you. Don’t expect others to help if you don’t make it easy for them.
To make a referral easy, start with this level of explanation:
Who is your target market
What problem are they facing
How will your product or service solve their problem
How would you like to be connected
What language should I use when connecting you
What evidence can I give to explain your solution
Tell stories about how you have helped your clients. This is a HOT tip, because we may forget so many of the ‘facts’ that you tell us, but we will remember the stories of how you help people. Its human nature to remember stories, so get good at relaying them
I have learnt over time, people are very willing to help you, but if you can not explain how and why you want to be helped, how on earth can you expect others to work it out for themselves. Clarity in business and life is one lesson I wish I had learnt in my 20’s, but if I knew then what I know now…..
Anyway, I hope that now I have shared this information with you. You can spend some time in quiet reflection and crystallize it for yourself - but a hot tip is this cannot be rushed or done in a 5 minute setting. Set some intentional time aside and write stuff done (I hated doing that but it works). In a few months you’ll have clarity of direction and purpose and those around you are more than likely to want to help you get to your destination.
No plan
So all of this clarity, direction and knowledge is absolutely useless unless you have a plan.
If I had a dollar for everytime a mentor, coach or wise person told me this I’d be a wealthy person. But because I always knew better, I never took the time to document my plan and with no plan you can’t expect to take considered action.
A good friend of mine who is an Abundance Coach once shared some great words with me. Intention without action is useless. And he's absolutely right.
If you want to build a referral business, plan who your referral partners are going to be. Plan how you will develop a trusting relationship with them. Plan how you will communicate how they can help you. Plan where you will network to cultivate new relationships and plan how you will spend your time helping others. Success happens when you invest in your plan.
To ensure you don’t make the same mistakes, put some time aside to work on addressing these 3 areas. You will need to put time aside, none of this will just ‘happen’. Lock the door, put your phone on silent, grab some paper and pens, some post it notes for your ideas and stick them on the wall and set yourself up for some quiet time to get yourself referrable.
Who are you in relationship with that you’d like to be closer with and how will you work towards deepening that relationship
Are you clear on what you get up and work in your business everyday and are you clear on your goals and who exactly you’d like to be connected to?
Do you have a clear plan of action?
I hope that these tips have helped you and that your referral business continues to grow and you sharpen your skill set.
