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  • The Referral Multiplier Effect

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    This post is a special Make a Referral Week guest post featuring education on the subject of referrals and word of mouth marketing and making 1000 referrals to 1000 small businesses – check it out at Make a Referral Week 2010

    David Meerman ScottAfter I read an early copy of John’s terrific new book The Referral Engine, it got me thinking about how really great online information makes the job of referring a friend, colleague or family member to somebody a simple process.

    Think about your own referrals. How many of them happen via an electronic mechanism (email, Skype, Instant Message, LinkedIn, Twitter, and so on). If you’re like me, nearly all of your referrals happen this way. Somebody will email or tweet me something like: “Hey, I’m looking for a great Web designer, do you know anyone?” How easy it is to just send a link to a Web designer’s work and some contact information!

    Most businesses aren’t like Web designers, though. We don’t have our stuff available for easy access. But this problem is easily solved. All you need to do is create something amazing on the Web—a YouTube video, a blog, an ebook, some photos, graphs or charts—something that people are eager to share with others (something that makes referrals easy).

    Make it free with no registration gates of any kind

    There is no doubt that free information made available on the Web creates a referral multiplier effect. When you make it easy for people to point to something interesting that tells your story for you, many more people will talk you up with their friends, colleagues and family members.

    Sadly, most people put brakes on their referral engine by requiring an email address (and other personal information) prior to permitting people to download content (such as a white paper). The thinking is that with a gate, each person downloading becomes a valuable sales lead.

    When you remove the gate and allow the completely free flow of information with no registration required, immense value comes from many more people consuming and spreading your content and referring you to others.

    For example, my most popular ebook The New Rules of Viral Marketing: How word-of-mouse spreads your ideas for free has been downloaded over one million times.

    Every week someone contacts me to say that they learned about my ideas first when someone referred them to one of my free ebooks. There is no doubt that if I required registration, I would not have a referral engine.

    I’m always interested in metrics from other organizations. For example, John Mancini, President of AIIM—a non-profit organization representing the users and suppliers of document, content and records management technologies—released an ebook called 8 Reasons You Need a Strategy for Managing Information — Before It’s Too Late. AIIM also made their ebook totally free, with no registration required.

    In just the first month of release, the ebook was downloaded 5,138 times. In addition, AIIM also created a presentation version of the book and posted that, also with no registration, on SlideShare. This version has had 3,353 downloads for a total of 8,491 downloads in the month. Pretty darned good result, for the first month of an ebook, I’d say, and each one a potential for a simple and easy referral.

    “Making the e-book available for free and totally without registration was a new approach for us,” Mancini says. “These results for unfettered access are particularly impressive when considered against a couple of more traditional examples (i.e., content requiring a registration on our web site).”

    So create some great content, make it totally free with no registration required, and encourage people to share. Your referrals will multiply immediately.

    David loves it when people refer to his keynote speech video

    David Meerman Scott is a marketing strategist, keynote speaker, and seminar leader and author of the best selling book The New Rules of Marketing and PR. The book is a BusinessWeek bestseller published in 24 languages.

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    Posted by: Referral Week on Mar 08, 10 | 6:06 am
    Category: make a referral week | Tags: , ,

    View Comments
    • techy
      I agree with your thoughts on viral marketing by encouraging consumers to share the content. With the likes of Twitter, Digg etc., its easier than ever to spread content and make it go viral. Of course, it could turn the other way round too.
      So its very important to figure out innovative ideas to engage with consumers.

      I use http://www.getmemedia.com/ to check out various innovative strategies on social media, WOM etc . Great resource for any marketing team.
    • JASON
      Not sure I completely agree with this. While removing registration will increase readership, it might increase readership with the wrong audience, and you'll lose out on getting the email addresses of the audience you were looking for. I can see some circumstances where this would be helpful, and others which would not be helpful.
    • I fully agree with your statement that "free information made available on the Web creates a referral multiplier effect."

      I wished that all the manufacturers, etc out there especially those in the Technology arena will listen to this piece of advice in today's new world where more and more are giving without any string attached.

      Givers Gain, that what we at BNI believed in.

      @angahsin @BNIraffles
    • Jim Johns
      So, I have a small business and when I get a new prospect that claims to be a referral, I always ask who referred them. One, I like to know that they are truly a referral, and two, I like to thank the referer. Occasionally, I can't make the connection when they drop a name (we are small so I remember most every order) so I ask them again. When I still can't make the connection, I get suspicious that they will ask for a deal. Nine times out of ten, when they are twice verified like this, they will ask for a deal. I consider them viral posers. I do give these folks a deal, but I usually require more written communication and payment up front.
    • Not sure I completely agree with this. While removing registration will increase readership, it might increase readership with the wrong audience, and you'll lose out on getting the email addresses of the audience you were looking for. I can see some circumstances where this would be helpful, and others which would not be helpful.
    • davidmeermanscott
      John - thanks for the opportunity to do the guest post.

      Mike - There are two different goals at work here. Do you want tons of people to talk about you and send your referrals to their friends, colleagues and family members? Or do you want some email addresses?

      If you really want to collect email addresses, I recommend having a secondary offer (at the end of a free white paper or ebook) that does have registration. Maybe for a webinar. The people who sign up are more of a warm lead because they have already read your paper. But you don't put the brakes on your referral engine.

      David
    • Thank you so much for discussing the "no registration gates required" idea. I JUST put up a free download on my main blog, The Franchise King Blog, that has some great, free, use them now, types of tips for prospective franchise owners. I did this with NO email registration required.

      I thought twice about it, and then then said to myself, "what the heck!"

      Thank you for helping me feel that I'm not totally (just partially) nuts for doing it this way.

      You do great work, David.

      Keep on keepin on.
    • Great post and a real conundrum. We want email addresses to create direct marketing lists to sell product later, but we also want our readership to increase to get hits on our site.
      I don't disagree with you, but this is slight paradigm shift (I finally got to use that phrase in a sentence).
      Mike - michael_e_anderson@yahoo.com
      http://www.directyourcareer.com
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