4 Strategies That Build An Army Of Sales Referral

One of the most cost-effective way to spread the news about your business, and build it at the same time is through referral. You've also learned how to develop an effective sales strategy. What you need to do, if you haven't already, is to follow the six procedures outlined, and you'll have your policy once you're done.

If you have a sales strategy already in place, you need to know how a good one looks like.

You can say that sales referral strategies are akin to 'word of mouth' plans. In an industry where quality is upheld as the most crucial distinction for a product or an offer like medical diagnostic sales, the referral is a valuable way to increase revenue without compromising net profit.

And I'll walk you through a few situations where you can learn how to build sales referral. You might be selling in different industries, no doubt about that, but the idea behind these examples can be applied to any industry.

Let's begin with:

A Good Referral Strategy That Brings Sale

I had a customer, a big Hospital in my area which runs Therapeutic Drug Monitoring (TDM) in one of our analyzers. The customer had been doing that for more than 5 years now. When I come on board, one of the areas which I cover is looking for a TDM analyzer to replace the existing analyzer which is near contract expiration.

And guess what?

The person in charge asks her colleagues around, and our company (and analyzer) stick out like a sore thumb. I was contacted, and right now we are working on the best deal for this particular customer. I believe in all sincerity, when we're done with the agreement, we'll get at least $300 k guaranteed sales for the next 5 years--probably more!

I got an excellent referral to thank. But there's a flip side of the same coin...

Referral Strategy That Turns Sour

Before I came on board of this company, my predecessor DID something 'unpleasant' to one of the big labs in my area. It was so bad that we were asked to 'de-installed' our machine from the lab--together with 1/2 a million worth of sales! I got to live with that, and the consequences from that are: whenever there's an open tender for any analyzer which we currently have, we were put in the 'comparison' list...

... And NEVER on the priority list!

We were referred to as 'bad company,' and it's not worth doing business with us.

That's what I mean by bad referral.

So the question now is, "How to have more of the GOOD outcome through a referral?", and here's what you can do:

• 1. Principle Is King

It's funny that just the other day, I had a coffee table talk with this particular customer and he asked me, "Between reputation and principle; which is more important in business?" And he volunteers the answer as reputation, but I argue 'nicely' with him.

I told him, "Let say your hospital is known as 'the lowest cost' healthcare provider--would you use low grade, no bio-equivalent study drugs just to live up to the reputation? Or would you rather put quality first and deliver that all the way; which is to say that you value quality?"

"You see, there's a classic example of principle versus reputation, but if you have a strong principle, you can build solid reputation no matter what." And he seems to nod in agreement.

No matter how you twist and turn thing; the sound business principle is the top priority.

• 2. Broadcast The Good Reputation

This is a spin-off from #1 and if your customer notice and respects your principle; you would not have a tough time broadcasting your reputation. It travels like air but makes sure you spray perfume in the air and not foul odor!

• 3. Stamp Your Brand Name

A good reputation needs to move to the next level, and that's branding. When you become the brand of choice for say, Hba1c testing, it's not difficult to expand your territory because everyone will be talking about you. Customers near and far will take the trouble to find you and hand you their business and sales.

But do you notice that Brand comes at #3? I purposely did this because if you work only on brand but you're weak on the 2 previous areas--you are doomed. Whatever you have now would not hold, and even a sneeze can bring down the house and expose 3 little pigs!

The ugly thing to see right?

• 4. Work At The Grass Root

Let me point out that if you have field force, i.e. sales force who roaming the field looking for sales and they did 'unethical' thing just to bring in the figure; eventually, you'll LOSE more than you gain. I like to use this guiding principle in all situation: "I want BUSINESS, not a sale!"

The sale is short term, but business is far and wide. Or to borrow the wise General saying, "It's alright to lose a battle but win the WAR!"

Sales referral strategies are very effective if done right, and you already know how to do that base on what I share. If you were ever in doubt, set your vision to bigger, long term goal. Don't sell yourself short because of few dollars in the bank--it's not worth it. Believe me.