Referral Based Business Development
If you want to build your business based on referrals, then you need to memorize this phrase from Alan Weiss:
“Referrals are the coinage of my realm.
Given the success of our current engagement, whom do you know who could also use such benefits and value?
If you would make the introduction, that would be greatly appreciated. If not, may I simply use your name? If you prefer, I won’t mention you at all.”
The last 3 sentences present your client with 3 choices of yeses. If you don’t actively seek referral business while doing projects, then you don’t believe you are adding value and that others deserve to have access to it.
3 Types of Referrals
Client – seek out ongoing basis. Tell the client at the beginning you will ask for referrals during the engagement once happy with the results. Ask 2/3 through the project for the referral. Ask for a referral by name or title (never simply who do you know?). Follow up with referral with sample language below immediately. Contact all present/past clients at least 3 times per year to request referrals. Maintain the mindset that you are not asking for a favor because you are seeking to do a favor by helping mutual acquaintances and professional colleagues. Ensure the referral is the buyer or can introduce you to the buyer.
Non-client – from other consultants, 3rd party, and serendipity. Literally, ask everyone you know for referrals. Anyone who can appreciate the value you provide. It is unethical to recommend someone to a client and not disclose you earn a referral fee. Otherwise, the client thinks it is objective when it’s actually a business arrangement.
Indirect – techniques – if you have permission to use your client’s names, which is normal, make your client list visible on your website and in press listings. Consider 3D expansion from existing clients. Who are your clients’ customers, suppliers, and so forth? Huge potential to reach out to others.
Scripting language to follow up with referral
“Prospect, I’ve been referred to you by X, who thinks you would greatly appreciate the kind of results he and I have generated together. X has never given me bad advice about these things, so I want to honor his suggestion and meet with you. I’m available on these 3 times next week:
How are these days and times for you?”
Don’t forget to remind clients you met via referral:
“Just as you and I came to meet through the recommendation and referral of Y, I would be delighted by your referral.”
Treat referrals well by reciprocating and making connections for them.
If you make it a two-way (referral) street, then traffic increases significantly.
Alliances to show me the money!
It only makes sense to talk about alliances when there is money on the table.
If you can’t name the client and the timeframe, save your breath
Look for 1+1=60. Your participation should exponentially increase the value to the client and fees to you.
Best alliances involve competencies and skills provided the other party doesn’t have them. Ex. We reduce the sales cycle + you recruit the sales talent is a powerful alliance.
Don’t confuse the need for affiliation with the need for an alliance. If you’re lonely, get a dog.
Check out potential partners as if checking out a potential client. Don’t want someone who won’t share info or severely struggling.
Don’t make it legal with a new LLC. A peer-level partnership between two consulting companies is sufficient and not a form of subcontracting. Partners must also apply methodology, business acquisition, or technology.
If the other party is only paid to deliver, then they are a subcontractor. Can’t effectively market. Easy to find.
Alliance formula to split the revenue = acquisition 50%, methodology 30%, delivery 20%