Referrals are the golden goose of sales leads and prospects. They come prepackaged with a seal of approval from a trusted source, they already have an idea of the type of solution you provide, and they can move through the sales process faster than prospective clients that are cultivated through cold outreach. Recent studies have shown that around 85% of decision-makers start the buying process with a referral.
Despite the overwhelming majority of prospects starting the buying process with a referral, only around 2.5% of business closed is sourced from this amazing resource. What should be a slam dunk for sales teams quickly becomes an airball that falls flat.
So what can sales leaders do to tap into the referral market and help drive sales? Referrals begin and end with every interaction your team has with each prospect. While that might seem like an enormous mountain to climb, by simply taking an Other-Centered® approach your team can quickly turn that mountain into a molehill.
Here are 5 tips from the ASLAN team to create a robust referral pipeline.
5 Tips To Open The Value To Your Referral Pipeline
When it comes to creating a high-performing referral pipeline, the ball is almost entirely in the salesperson’s court. Here is how.
Simplify The Sales Process
Think back to a time when a friend asked you for your opinion. Chances are, the last thing that you wanted to suggest was something that involved a complicated process. Most customers that provide referrals do not want the sales process to be a burden for their colleagues or friends. Luckily, as sales leaders, we have the ability to directly impact each stage of the sale and help reps streamline every step for the buyer.
One area where we often see roadblocks occur is through the negotiation phase of the deal. The buyer wants a better price, and the salesperson wants a higher commission. The result is a game of high-stakes tug-o-war that creates tension. This tension can only be removed by the sales rep Dropping the Rope®. In doing so, they build trust and simplify the process for the customer. The easier the salesperson makes the purchase, the more likely that customer will be to refer a friend.
Focus On What Matters
Closing business might matter to each salesperson, but no prospect has ever bought a product or solution simply because they knew that a salesperson had a quota to reach. An Other-Centered sales approach starts with a salesperson removing their needs from the equation. We refer to this as understanding the prospect’s “whiteboard” and focusing on those of the prospect. Each need, challenge, and goal that each prospect has established is on their whiteboard. Each whiteboard is different, and they all change over time.
By focusing on what matters to the client, the salesperson can easily build trust and get deeper and cultivate a relationship. Those relationships are a major contributing factor to whether or not someone will provide a referral.
Bring Value To Every Conversation
Value is a word that gets thrown around in the sales industry. It is important to understand that there is a difference between hard selling and approaching each conversation with value in mind. Value-based conversations offer more than a specific product or service. They provide expertise and emphasize the needs of the client over the wants of the sales rep.
An Other-Centered mindset is at the heart of value-based selling. Over time, reps that take this approach will find it easier to build trust and cultivate deeper relationships. It means a great deal for someone to give their endorsement of a specific product, especially if they have no skin in the game. For most, a seal of approval is only granted when they know that the person being referred will receive the same value and they trust the sales rep to focus on the referral’s needs.
Stay Engaged After The Close
Many sales organizations are starting to adopt a Software-as-a-Service(SaaS) sales model, and while that structure provides a proven methodology, it comes with a few pitfalls. For example, most that adopt a SaaS model have a swift client handoff from the sales team to the customer success team. This can easily create a sales mindset that focuses on closing the deal and then passing them off so that reps can move on to the next prospect.
This can be detrimental to creating a referral pipeline, simply because it restricts the ability of sales reps to cultivate long-term relationships with clients. Instead of regular engagement, sales reps only come back into the conversation when it is time to renew a contract. For organizations that take a siloed approach, it is important to create touchpoints between the client and sales team that go beyond “Hey! I know you haven’t heard from me in six months, but it is time to renew.”
Think Like A Farmer
Building a referral pipeline doesn’t happen with the flip of a switch. There is no magic formula, or contact list, that reps can access to find referral leads. It requires an investment of time with each customer. Time is required to build trust and cultivate the relationships that ultimately lead to a referral. Although there may be instances of a short referral cycle, approaching this side of the pipeline like a farmer, instead of a hunter, is required.
Many sales executives act with their “hunter” mentality, so they disregard anything that doesn’t yield immediate results. As sales leaders, it is our job to encourage salespeople to look at both sides of the coin and help them understand that one helps create the other, and both approaches are essential when it comes to referrals.
Create A Referral Network With ASLAN
Creating a team with an Other-Centered mindset doesn’t happen overnight. We have worked with countless sales teams and will be the first to tell you that it is a constant process of improvement. The teams that are able to transition to a customer-centric sales philosophy are more likely to close business, and those customers are more likely to help champion your product or service.
At ASLAN, our goal is to streamline that process and equip your team with the tools to have more meaningful conversations and cultivate deeper relationships with your clients. Learn more about our services by visiting our website, and connect with our team to schedule a consultation.