Sales Acceleration with Referrals Part III

This week’s blog, is by Drew Stevens PhD, one of the worlds leading experts in sales and sales skills, and author of Split Second Selling and the soon to be released Ultimate Business Bible – 12 Strategies for Ultimate Success.

This is the third installment of a three part series.

Referral building depends on value and the best evidence of this is through customer service. Research illustrates that between 45 and 60 percent of every customer interaction involves customer service. The key differentiator in a competitive environment is the quality of service customer’s receive when doing business with your organization.

It is widely known that customers are 18 percent more likely to remain with organizations that treat them well. Customer service clearly reduces expenses when current clients remain with the firm due to loyalty. Most important, customers help to acquire new clients by becoming marketing avatars. Loyalty has a lot to do with how well companies deliver on their basic promises.

When customers believe that they are treated fairly and have a marginal equity in the organization, they become loyalists. Loyalty and value are directly correlated to customer referrals. Please note that I am not merely speaking of the customary customer referral programs, but the true level of appreciation of clients that have been doing business with you. When clients believe in you they will refer the clients. For example, if your local barber or pharmacist did something for you during each visit which saves you time and money, you might be more tempted to tell all of your friends about a fabulous experience. Or you might even bring some of your friends with you on your next visit.

This clever form of customer acquisition is known as a referral program. While many organizations use a formal referral program such as punch cards or stamps, nothing is better for increased business than a loyal customer telling others. According to a study in the Journal of Marketing, customer referral programs are indeed a financially attractive way for firms to acquire new customers. These value-based programs illustrate that good referrals from existing customers generate higher margins than any other customer program. Customer referral programs stemming from a culture of customer service have even higher gains than any other organization. Simply put, loyal customers generate more revenue at a lower cost to the firm and any traditional marketing approach. It is therefore imperative that organizations become more proficient and embed customer service in their culture; this lowers expenses and produces more profits while lowering acquisition costs.

Activities to Help Gain Additional Referrals
Several traditional and nontraditional resources for creating a referral network are available. Some traditional resources are sending gift cards or writing letters to clients. Many individuals still send handwritten notes and greeting cards to their clients. Keep track of anniversaries, birthdays, or other noteworthy announcements. Customer relationship management software facilitates this process. Electronic delivery does not require constant use of electronics.

However, if lack of time affects the ability to remain in constant contact, other resources are available. Business professionals can use a wealth of electronic sources to assist them. Some of these include e-mail marketing campaigns, electronic newsletters, electronic tip sheets, and even electronic greeting cards. “Send Out Cards” is a relatively new service. Simply upload your database into their Internet software and choose a greeting card of your choice. This service then uses your electronic signature and manually mails the card to your customer. This is a great service if you lack the time and energy to sign and mail an important announcement. No matter what you do, remain focused on your client. Most important, it is imperative that your clients appreciate your value and can articulate it to prospective clients. Remember, “Out of sight out of mind.” To build up your referral network, you must remain in harmony with customers.

Best Practices For Referrals

• Make it Easy – Allow others to know your value. It is beneficial for you to develop a value proposition so that others can repeat your value to others within their community. For more information on creating a value proposition, see the marketing chapter in this book.
• Remain in Contact – I mentioned earlier that in order to get referrals you must remain in constant contact with your customer base. If you do not, your competitor will.
• Communicate Often – Ensure you’re communicating with your clients at least once per month. More is fine as long as it is not overdone.
• Network Aggressively – It is necessary to meet others frequently. Attend regional and national events to be known within your local community.

© 2011. Drew Stevens PhD. All rights reserved.

Drew Stevens Ph.D. President of Stevens Consulting Group is one of those very rare sales management and business development experts with not only 28 years of true sales experience but advanced degrees in sales productivity. Not many can make such as claim. Drew works with sales managers and their direct reports to create more customer centric relationships that dramatically drive new revenues and new clients. He is the author of Split Second Selling and the founder and coordinator of the Sales Leadership Program at Saint Louis University. Contact him today at 877-391-6821.

“Help! I’m Slumping, And I Can’t Get A Sale!”

By Jeffrey Gitomer

In a slump? Not making enough (or any) sales? Feel like you’re unable to get out of the rut? Is it the economy or is it YOU? Maybe you’re not in a big slump, but just can’t seem to hit the quota numbers. Let’s be kind and call it “sales underachievement.”

Don’t panic. Don’t press too hard. Don’t get down on yourself. Don’t get mad. And above all — don’t quit.

OK,OK, there’s a bit of slowdown, but don’t be too quick to blame your lack of performance on “it” before you take a hard look at “you.”

Take a closer look at “slump” before you blame “economy.” Here are the prime causes of sales slumps…

When to Ditch the Elevator Speech and Take the Escalator or the Stairs

by Charles H. Green

You know the “Elevator Speech.” It is the hypothetical answer you would give if you were alone in a high-rise building elevator with the CEO of a potential client. Presumably the CEO says, “Tell me about your company,” or “Tell me why we should work with you.” Your presumed answer—sometimes called “the elevator pitch”—turns out to be a good solution in search of the right problem.

There are situations where a 30- to 60-second answer to those questions is exactly what’s called for. But there are other situations—far more, in fact—where different approaches are called for—let’s call them the Escalator Speech and the Stairs Speech.

What does your organization reward?

The Brooks Group

Hiring top-quality salespeople is a constant source of stress for many sales managers.  Of course, not every salesperson is suited for every sales job.  Wanting to sell, selling, and ultimately succeeding at sales are three separate issues.  Why a person chooses a sales career – what’s behind the interview façade – is often the most significant driver of performance.  Why does a person choose a particular path?  The answer lies in what he or she values the most.

Valuing something strongly means that things associated with it are what you care about most deeply and passionately.  If what you value most is rewarded in your work environment, odds are good that your performance will be high and attitude and commitment will be strong (as long as job skills and personal skills are present).  In contrast, if you are in a job that does not reward what you value, the opposite occurs…no matter how intelligent or dedicated you are.

Let’s look at two examples…

Selling a Price Increase: Is There a Good Time?

By Mark Hunter

When is the best time to sell a price increase?  I get asked this question a lot and my response is “right now.” After I say this and see the expression on the person’s face, I then have to back up my response with my rationale.

Taking a price increase is not something to be taken lightly. It has to be done with confidence, and too often, salespeople will put off taking a price increase under some false belief that if they only wait a couple of weeks, some how things will be better.

Sure, waiting is an option, but often the only thing you’ll experience is more of a belief as to why you can’t take the increase, as well loss of the added revenue during that time frame.

My perspective is you can take a price increase anytime any of the following conditions occur:

1.  A competitor has gone up in price.

2.  You’ve incurred an increase in your costs.

3.  Your customers have just taken their prices up.

4.  Other key players in the industry are increasing their prices.

These four reasons are all what I refer to as “market factors,” and any one of them is certainly reason enough to advance.

Keep in mind, though, that just because one of the above is true does not mean you should increase your price. It merely means the marketplace is giving you permission to do so.

Listed below are what I call “value factors.” These are the real reasons why you would want to take a price increase.

1.   Has your customer realized added value during the past year from using your products and/or services?

2.   Is your customer going to be realizing added value from what you provide them in the year to come?

3.   Are there improvements in service or performance you can document that your customer would see value in?

4.   Will you be able to increase your strategic importance to your customer in the year to come?

5.   Can you show your customer how what you provide them will give them a competitive advantage or minimize their risk in the year to come?

These are the real reasons why you can take a price increase.  The reason I say you can take an increase is because your customer is seeing increased value in what it is you provide.

When the customer can see increased value, you have every right to increase your price.  Yes, there could very well be other strategic or even tactical reasons why you would still not want to take a price increase.  Those questions are going to be answered only when assessing your overall business plan.

Again, my perspective is you should take advantage of increasing your price whenever possible.  Being proactive protects your bottom-line and provides you some protection against price increases with which you will have to deal on the production or operation side of what you make.

The more confident and comfortable you become in your pricing – including your price increases – the less likely you will be to devote precious effort and energy to worrying about your pricing.  That effort and energy is better spent on showing your customer how the value of your product or service meets their needs and the benefits they desire.

Copyright 2011, Mark Hunter “The Sales Hunter.” Sales Motivation Blog.

Sales Acceleration with Referrals Part II

This week’s blog, is by Drew Stevens PhD, one of the worlds leading experts in sales and sales skills, and author of Split Second Selling and the soon to be released Ultimate Business Bible – 12 Strategies for Ultimate Success.

During my last article I illustrated the reasons for referrals and how they assist business. In this segment I want to focus on what do say so that you can get the best exposure and offer the most value to your clients.

I suggest using the following wording verbatim or practicing a similar vocabulary until you feel comfortable enough with a client. It is best to be comfortable yet confident so that you get the desired reward.

“Dear Mr./Mrs. _________________________

Today’s competitive economy presents a myriad of challenges to business growth. However, as you know, the bedrock of every business is the admiration and support from clients like you. Business is built on the foundation of clients who appreciate the value that we provide. I would like to ask you for the names of three to five friends, colleagues, or peers who might be in need and appreciative of the value that I can provide to their organization.

I would like the opportunity to call you in the next few days to obtain these names so that I can continue to build my business and foster new relationships similar to
ours.

I thank you so much in advance and look forward to speaking with you.”

This model illustrates three vital components:

1. the value of your existing relationship

2. the importance of the continued relationship

3. the appreciation of your value and how it can be perceived by others

Clients who feel so strongly about the relationship and value will be more than happy to provide you with the names of others who can extend the loyalty and admiration. Remember, you must be confident and articulate clearly yet succinctly what you seek. I also suggest not beating around the bush. Make the statement, pause, and then listen intently. Allow your client time to process the request to consider how to assist you.

One final point. Do not end the conversation without having received what you seek. Following too much time between the initial request and its conclusion will create dissonance. And in today’s busy world, you may not get another opportunity to ask a similar request.

In part three I will conclude with best practices and activities that will gain the best
exposure for referrals.

© 2011. Drew Stevens PhD. All rights reserved.

Drew Stevens Ph.D. President of Stevens Consulting Group is one of those very rare sales management and business development experts with not only 28 years of true sales experience but advanced degrees in sales productivity. Not many can make such as claim. Drew works with sales managers and their direct reports to create more customer centric relationships that dramatically drive new revenues and new clients. He is the author of Split Second Selling and the founder and coordinator of the Sales Leadership Program at Saint Louis University. Contact him today at 877-391-6821.