How Much of Your Business Is By Referral?

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Even in this era of so much emphasis on Social Media, including Facebook, Twitter, LinkedIn, YouTube and other channels as lead generators, I often hear from people that their new business opportunities still come almost 100% by referral. This is particularly
true for small businesses. While 100% may be the goal, usually the real number is significantly lower. Folks aren’t lying; they’re just operating under a misconception.

This misconception comes from the lack of a system that develops and tracks lead generation and more specifically, referral generation. If you want to build your business through referrals, you need a system to develop and track them. That means your system
includes a way to track and measure. While “paperwork” is, for me, the least attractive part of sales, (unless the paperwork is a contract) results are erratic and unpredictable without it. Who is giving you referrals? Who are you referring? What are you doing to earn referrals? What is your closing percentage for referrals vs. other lead sources? Are you in the right networks? Are the referrals you are receiving your ideal clients or are they “anybody” or “somebody”?

This fifth “M” of the 5 M’s of Marketing may be the least glamorous of them all, but it can be the difference between a hobby and a business. So, if you want referrals to be a predictable part of your new business generation instead of just a happy surprise, you need a system. And a big part of that system is Measuring your activities and results.

2 thoughts on “How Much of Your Business Is By Referral?

  1. Tom Doiron

    Hey Emile,

    I wonder if we ever got to the place where we could afford to pay someone to faithfully tract this information; if we would really need it?

    Measured results are the only way to chart success. Depending on our business goals; it is possible to get “big enough”. This happens at our financial sweet spot. Then we need to retain those customer/clients we have and replace the attrition. I know a great tool to help accomplish this!
    Wishing You Plenty To Live,
    Tom Doiron
    Atlanta

  2. Emile Paradis Post author

    Hmmm??? Wonder what that tool might be? Actually, Send Out Cards is one of a number of affordable ways for small business to initaiate CRM in their business. Figuring out what to track is the first step. That will help to decide how much is enough in the way of tools.

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