If you ask most small to medium business owners if they think referrals are valuable, I’m willing to bet that almost all of them would say that they do. If you ask those same folks how they currently ask for and track referrals from their customers, I’m willing to venture a guess that most won’t have as much conviction in their responses. 

We all know that referrals are a valuable source of high-quality leads for your business and yet, it can seem daunting to consistently ask all customers if they know anyone that could use your business’ products or services. So, why don’t you ask for referrals? Let’s dive into a few reasons why people don’t ask for referrals (but should).

Fear

In speaking with countless business owners over the years in various industries, I can tell you that many of them are afraid to ask for referrals. The reasons vary but often include things like “What if they didn’t have a great experience” or “What if they just purchased a small/inexpensive product or service from me?” 

I think I speak for us all when I say that I’ve experienced my fair share of imposter syndrome. Business owners can feel surprised by their success and often doubt their customers’ satisfaction. This makes asking for referrals difficult because they are afraid that they may receive negative feedback about the customer’s last experience with their company. Taking criticism is never fun.

However, here’s something you have to keep in mind regarding referrals. They aren’t reviews. You have to separate those two things in your mind. Thinking that a customer might have had a bad experience with your company and then asking them to go leave you a review on Google or Yelp is a recipe for getting bad reviews. 

Asking someone to refer their friends to you has very little downside. Worst case they reply to your email, text, or phone call by telling you the problem they had. This gives you the chance to make it right and really wow them. Once you’ve gone above and beyond, you can again ask for referrals, often with a higher chance of success than if they had been happy to begin with. 

Moral of the story, don’t hesitate to ask for referrals because that question can only help you take better care of your customers and/or get you more referrals to people that could use your products or services. 

Reciprocity

Another issue that I’ve heard from people who have trouble asking for referrals is that they feel like their customers will interpret it as a selfish ask. This hesitation makes perfect sense. No one likes a tone deaf request for something that is clearly self serving. 

There is a simple solution for this issue. Reciprocity. Rather than talking about how you need referrals in order to grow your business or saying that “During these trying times, your business needs all the help it can get,” we can focus on what’s in it for the customer and their referrals.

The key is to target appropriate reciprocity. If you can offer something (like a discount) for your customers’ referrals and an incentive for your customer in exchange for sending you their friends, then everyone wins. Your business gets new, high-quality leads that are much easier to close and convert into new customers. 92% of people trust referrals from someone they know. 

If you are having trouble asking for referrals, it could be that you don’t have a strong enough incentive or you aren’t giving something to the referrals as well as the advocate that referred them, which can make it hard to ask for referrals.

To hear another person’s take on reciprocity, check out our first WarmUp Chat where I interviewed Chris Chasteen from Content Cucumber. He talks about reciprocity and the importance of it HERE.

You Forget or it’s not a Priority

This may sound funny, but we all do it! With everything going on in a business from leading your team, to taking care of customers, to working on your brand and marketing, to talking to a board of directors or investors, you’re busy. 

Prioritization is something that even the best of us often have trouble with. I’d like to think I’m a pretty organized person, but I have whole days that go by where I intend to do one thing, but constantly get sidetracked and never get that thing done. 

If you aren’t intentional about asking for referrals and if you don’t track those referrals to verify that they are a valid source of leads for your business, then you’ll never be successful. Sending an email once a month where you tacitly mention that you have a referral program towards the bottom is a sure way to make a referral program fail.

You have to believe so thoroughly in your program and your ability to wow your current customers and their referrals that you’re proud to ask people to send you new business. 

When you get over that initial fear, establish an incentive for your customer advocates and their referrals, and get intentional about asking every single customer and shouting that you have a referral program from the rooftops, you’ll see success. 

With referrals, we’re not talking about a small increase in business, but a huge bump. Dropbox was literally failing when it decided to start a referral program. It went from 100K users to 4mil users in 15 months using a referral program. 
If you want to learn more about referral programs and how to track them, we’re here to help. Just send us a message and we’ll schedule a call to chat. Thanks for reading!