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When Should I Ask for a Sales Referral?

 

Sales referrals are one of the best ways to close deals and grow a business. But when is the right time to talk to your customers and ask for a sales referral?

Image of a woman asking her customer for a sales referral

Most folks in sales understand that they need to find leads  and close them as customers if they want to retain their job and keep their company in business. Sometimes generating good leads can be difficult, especially if you’re trying to conjure them up out of thin air. And then closing those leads poses a different challenge altogether.

But what if there was an easy way to go about collecting good leads and closing them? What about asking your existing customers for sales referrals? It’s one of the best, but often most overlooked methods for increasing sales. In fact, studies show that referred sales close at a rate of 70% or better. 90% of customers are willing to give referrals, but just 10% of salespeople bother to ask. And finally, salespeople who are vigilant about seeking out and using referrals make 4-5 times more than salespeople who don’t. Convinced that referrals are a good idea yet?

Sales referrals work so well, because people prefer to do business with people that they like or are at least familiar with. And think about this: how much more likely are you to try out a new restaurant or go see a movie that someone you know recommends? So ask your customers for sales referrals. Here are the four most common times to ask for the referral:

  • When you close your order
  • When you deliver an order
  • After you solve a significant problem for a customer
  • When you deliver unexpected good news

These are the times when the iron is hot – so strike it! However, if there is a best time of those four, it would be to ask for the referral after delivery rather than after closing.

Once you have had the conversation with your customer about referrals and they have given you a name and contact info, ask if they wouldn’t mind introducing the two of you. Even a little intro email works well.

When you go to pitch the referral, it’s pretty easy. It can sound something like this:

YOU: “Hi Ben. My name is Larry Donovan. Ron Davis over at XBC Global suggested I give you a call. I have been doing business with Ron for about 6 months now.”

PROSPECT: “Oh, ok. What is it you can do for me?”

YOU: “We provide  answering service  support for Ron and we help maintain a professional customer service brand for his business. Since working with Ron, we have helped him increase his sales by 20% just by handling his phones after he closes up shop for the day. Since you are in a similar line of work, Ron said I ought to give you a call.”

PROSPECT: “Well I appreciate that. Tell me a bit more about what you do.”

That is the basic nature of a referral sale. Now you have a warmed-up prospect who is ready to be closed and all you had to do was ask. Happy selling!

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About Brian Gabriel

As the Call Center Manager for Sound Telecom, Brian is responsible for overseeing the daily operations and long term success of the company while managing a variety of inbound customer support programs. He also has a hand in taking care of the Solaxis services division. Prior to joining Sound Telecom, Mr. Gabriel held management positions with several prominent Internet Services companies including XpenseWise.com and Greatfood.com. Brian started his career in advertising and sales before moving to Washington State. He joined AEI Music in 1995 and supervised their international customer service department and technical support call centers. Brian received a Bachelor of Arts degree in Journalism with a minor in Spanish languages from San Diego State University. Brian teaches adult education at his church and actively supports Christian ministries.