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Off The Ladder

What is the Definition of a Referral?

WOW! The response to our request for readers to give us their definition of a referral has been tremendous.

Please keep them coming using the form below. We have removed the requirement to leave your email so we can assure you this is not some sort of list building scheme.

I want to show some of the responses here so you can get an idea of how diverse the answers are:

  • “To me a referral could be any number of things. First, a referral does not always need to be for monetary gain. A referral could be an introduction that could help an individual grow in some way. Direct referrals that are meant to end in a sale need to be well thought out and qualified. To do this we all need to educate ourselves about the individuals and businesses that we associate with. We need to be ready when the opportunity presents itself. “Qualified” is the key word though, there is nothing worse than receiving a “referral that was passed just for the sake of saying “Hey I passed your info along to so and so.” Instead take the time to make the introduction between the 2 parties and create the dialogue for a successful experience between both.”
  • “An introduction, possibly the first step in establishing a relationship.”
  • “A referral is a viable business lead that does not culminate in a demand for pro bono work. To me, a solid referral is a well vetted potential customer that understands the value of paying for a quality product. I cannot tell you how many referrals I’ve been given which resulted in the expectation of work for the low, low price of free. I cannot feed my family on free.”
  • “According to the Cambridge Dictionary, a referral is an act of sending someone or something to a person or place where what is wanted or needed can be obtained. It also means the act of directing someone to a different place or person for information, help, or action, often to a person or group with more knowledge or power.”
  • “A referral is somebody recommending something to somebody else.”
  • “To me a referral is when someone tells someone else you did great work for them and they should hire you. I guess a great referral is really a recommendation.”
  • “A customer referral is a confirmation that a business is serving their community well and providing goods/services of high quality to its customers. When satisfied customers recommend a business they do so with peace of mind and confidence that the recipient is going to receive the same quality of work.”
  • “Hey Michael, you probably won’t find this in a dictionary but a referral is a RELATIONSHIP where someone TRUSTS you/your brand enough (either by reputation or personal experience/interaction) that they are willing to RISK their REPUTATION to RECOMMEND you or your business.”

Thank you to all who have already responded, and I look forward to seeing responses from the rest of you soon.

What I’ve learned about referrals so far.

As you can imagine there is a lot of research that goes into something like this. I have found, after more hours than I’d like to admit, that there are a lot of interesting articles out there on how to build a proper referral strategy for your business.

What I have not found is a clear definition for the term referral.

I really thought this is important to what we are trying to accomplish here. If we truly want to harness the power of referrals to grow our businesses, we should understand what a referral is.

I am not so sure now.

I have found that there are differing types of referrals and differing ‘levels’ of referral. Maybe, understanding the nuances of each may be a better strategy.

I will keep digging.

Categories
Off The Ladder

How to Harness the Power of Referrals to Grow Your Business

[UPDATE]

A dear friend (limey from England…LOL) told me I should include some kind of introductory message so readers understand where I am going with this and I agreed.

I am a Networker. I love going to networking events, shaking hands, talking with new faces and making connections. At all of these networking events invariably we have to stand up and tell the crowd what a good referral for us would be. This got me thinking.

Is telling people who you are looking to work with the best way to get business referrals? Are those actually referrals? How well does this type of network referral work?

The questions just kept coming…

I decided to do something about it. I decided to demystify the topic in its entirety.  With your help we will define a referral, learn how and why they work, learn the best strategies for getting them and learn how to optimize them for our businesses.

This will be an ongoing series of blogs, charts, infographics, resources, lists and more – I just hope we can finally come up with a comprehensive understanding of referrals so we can all harness their power and grow our respective businesses.

[ORIGINAL ARTICLE]

How to Harness the Power of Referrals to Grow Your Business - Contractor Websites PlusThe first business I owned was a lawn care company; I bought it when I was 17 years old. Back then there was no internet, no smart phones, no review sites – you truly built your business based on word of mouth referrals.

When you needed something, you asked your friends or your family where they got theirs or who did it for them. You made the call and bought the product or tried the service. If you liked it, you added it to your long list of mental notes for referral to your friends. That’s how business was done, and it worked well… Back then.

The anatomy of a referral has changed.

Let’s fast forward to the modern world where five-year old’s hold enough computing power in their hands to land the Apollo 11 on the moon. Information is everywhere and it’s within everyone’s reach at a moment’s notice.

We no longer ‘trust’ and blindly depend on the word of our close friends and family members as we used to. Why would we when all the information we need is at our fingertips? Today we ‘look up’ the people we are referred to. We study their website, their social media and their reviews. Referrals have become more complicated and benefiting from referrals is no longer easy – we have to work at it.

How Referrals Are Effecting Your Business.

I have worked for hundreds of businesses large and small who at some point stated they get plenty of work How Are Referrals Effecting Your Business - Contractor Websites Plusfrom referrals. When asked how many referrals they are losing they have no idea. Most have never thought about it. That’s a problem.

How much money are you losing to lost referrals? What is causing you to lose those referrals? What can you change to win them instead of losing them? How much growth can you achieve creating a strategy to win ALL your referrals?

The good news is we are going to solve that problem.

What Can We Do To Solve The Problem?

I am going to embark on a journey; a deep dive into the world of referrals. I want to know what they are. How they work. How we can measure them. More importantly, how we can harness and control them.

Referrals are obviously a huge part of doing business, yet no one seems to be able to answer any of these questions. Why?

I am going to find out and I’d like you to join me.

Understanding and harnessing referrals is a problem that runs across all sectors of business. Whether you’re a service-based company or retail, referrals are a huge part of how we earn an income. And, by the way, this includes me!

I want the answers to these questions too! I want to improve my business. I want to improve the businesses of my customers.

This is a personal journey for me, and I’d like you to come along.

Together we are going to demystify referrals and create a strategy to optimize them for your business and mine. We are going to learn more about how they work, why they work and how we can truly harness their power to grow our businesses.

I am going to do all the heavy lifting, all the research, all the writing – I just need you to answer a few questions for me now and again.

Deal?

Great! Let’s get rolling…

What is a referral?

I guess the first question we must answer is “What is a referral”?

I know it sounds silly, but really, what is a referral? What constitutes a referral?

According to Google:

Referral: re•fer•ral (/rƏ’fƏrƏl/) – noun

an act of referring someone or something for consultation, review, or further action.
• the directing of a patient to a medical specialist by a primary care physician.
• a person whose case has been referred to a specialist doctor or a professional body.

I guess this loosely defines a referral for our purposes but it’s weak – very weak. We need a more clearly defined version.

What ia a Referral - Contractor Websites PlusAlthough this is a stretch – a huge stretch – I would refer you to Sun Tzu (Yoda is pictured because I couldn’t find a royalty free Sun Tzu – I thought this was close enough…):

“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”

While Sun Tzu is discussing a much more serious topic in his classic “The Art of War”, we can still learn from his writing. We must know our topic before we can conquer it.

So, I’ll ask again: What is a referral? What is a referral in the modern sense? What is a referral in the day and age of websites, social media and on demand reviews?

Is a referral simply a friend telling a friend “You should call this guy”? Or, is a referral much more complicated than that now?

What’s Next?

I am going to start researching and formulate what I hope is a definitive answer.