How Building a Referral Tree Can Help You Win More Business
It’s not hard to understand why – typically, a higher percentage of business is won via referrals, often thanks to the referrer doing a great job of warming the prospect up to you and your business even before you’ve spoken with them.
But most IT businesses sit back and wait for referrals to come to them. If referrals are good for your business, why not put some effort into finding them?
Staying in regular touch
Making sure you stay in regular contact with those people who have referred business to you before is an excellent way of encouraging more referrals.
To put it another way – how many times have you had a long overdue catch up with a business friend and during the course of conversation they’ve exclaimed “If only I’d have thought of you a couple of weeks ago – there was a great opportunity I could have passed to you!”.
By making sure you keep in touch with people, you are ensuring you’re not far from their thoughts when they come across a potential referral for you.
Finding the time to do so
I make staying in touch with people a priority in my own business and while remembering there is no substitute for a regular face-to-face or a telephone call, Social Media can help with keeping in touch too.
But I appreciate that most of us have only got so many hours in the day. With that in mind, which individuals are so important to you and your business that you can’t afford not to remain in touch with them?
A referral tree will help reveal this to you.
Building a Referral Tree
A referral tree will help reveal to you who has referred business to you, and how much that business has been worth to you.
To build your own referral tree
- Grab a sheet of A4 paper and write down all the business you’ve won over the past couple of years.
- Next, scribble the initials of the person who referred that business to you, and how much that business has been worth to you to date.
- In most cases, the person who referred that business to you they themselves came as a result of a prior referral. If so, jot the initials down of the person who referred them to you, and so on.
- On a new sheet of A4 paper, write the initials of your top referrers at the top of the sheet, and (just like a tree with branches) underneath write the business they’ve referred to you and its value.
- Underneath that won business, write any other business you’ve won through referrals from that new client.
Finally, total up the value of all the business in a single “branch” and be prepared to be surprised at the level of business that some people have referred to you over the past couple of years…
It’s easy to assume all referrals come from existing clients.
But when I first put together a referral tree as an MSP owner, I was surprised at the amount of business I was being referred by people who I didn’t personally do business with directly.
I was also surprised at the amount of referrals I received from Strategic Alliance partners – those people who ran complimentary businesses to my own, such as telecoms companies and data cabling companies.
Once I had clarity over this information, I made sure to firstly thank the individuals concerned for their faith in referring so much business to me, and secondly, put reminders in my diary to keep in touch with these individuals on a regular basis. If I’m in regular touch, I’m probably not far from their thoughts making them much more likely to notice potential opportunities.
We’d all love to stay in touch with all of our business contacts more often, but with the best will in the world, it’s difficult.
Building a referral tree enables you to analyse who are the sources of your biggest referrals, and therefore some of the people you should make sure you stay in touch with and show your gratitude to!