Today, I spoke to John Jantsch, who is a marketing and digital technology coach, award winning social media publisher and author Duct Tape Marketing and his new book called The Referral Engine. In this interview, John talks about what a referral engine is, how long it took him to develop his own, if it’s easier to generate referrals because of our connectivity now, how to manage referrals, and why you shouldn’t refer everyone.
What is a referral engine and why should people care about it?
Referrals are the greatest leads on the planet – when generated correctly they are more qualified, less costly, and generally not as price driven. Building a systematic approach to generating referrals through customers and strategic networks is how you build marketing momentum.
How long did it take you to develop your own referral engine? What were the obstacles and the benefits?
I guess I’m not done, so on one hand a very long time, but benefits poured in within weeks of taking this view. The real obstacle is time, as in most things, you’ve got to change your marketing mindset, go to work on being more referable and commit to a plan of action – people get restless and have trouble putting in that kind of groundwork, but it’s absolutely worth it. I can’t tell you the last time I went looking for business.
Is it easier to get referrals now than five years ago? Are there new dangers with technology?
I don’t know that I would say it’s easier to get them, in fact, in some ways it’s easier for someone to damage your ability to get them. But, it’s definitely easier for you to equip your champions and partners with tools and tactics to spread the good word – if indeed you’re doing remarkable work.
What happens if you end up getting a lot of referrals? How do you manage that pipeline?
Raise your prices. Half kidding, half serious with that, but always measure and assess the value you deliver. My guess is you’re not charging near enough. Make certain you can afford to create an incredible customer experience and people will expect to pay a premium.
Can referrals hurt your personal brand if the person isn’t qualified to perform the service?
Sure, don’t refer to just anyone. Build your referral network with one view only – nobody makes it on your team unless you would send your best customer to them. Take the time to build a relationship with your referral sources and build up the know how to become the “go to” person for everything your customers need.
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John Jantsch is a marketing and digital technology coach, award winning social media publisher and author Duct Tape Marketing and The Referral Engine. He is the creator of the Duct Tape Marketing System and Duct Tape Marketing Coach Network that trains and licenses small business marketing coaches around the world. His blog was chosen as a Forbes favorite for marketing and small business and his podcast, a top ten marketing show on iTunes, was called a “must listen” by Fast Company magazine. He is the featured marketing contributor to American Express OPENForum and is a popular presenter of workshop and webinars for organizations such as American Express, Intuit, Verizon, HP, and Citrix. His practical take on small business is often cited as a resource in publications such as the Wall St. Journal, New York Times, and CNNMoney.
