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Bake a Referral Engine Into Your Business Model

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

Have you ever squirmed when a seasoned businessperson asked you “what sets you apart from your competition?” or “what are you truly great at, that no one else in your market can do better than you?”

You are not alone.

Many new entrepreneurs get uncomfortable with the notion that they have to be an expert in their field to have a successful business. This is because they think that they have to know every last thing about the market in order to be considered an expert.

Here is the good news: one of your unique differentiators can be your ability to refer your clients to fantastic people who compliment your work. You don’t have to know everything. You just have to know people who do.

I have designed my business this way. I feel exceptionally competent helping corporate employees figure out which business to start. I can wrestle their snarling fears with confidence. I can help them with branding and marketing plans, and teach them how to grow their network using social media.
But if they ask what kind of business structure will protect their assets, I draw a blank. That is why I have tax attorney and business process guru Kyle Durand on speed dial. If they are creating a new software product and want to know how to wade through IP laws and trademarks, I send them to Jill Hubbard Bowman.

If they have no idea which shopping cart to use on their website, I send them to research maven Crystal Williams, otherwise known as Big Bright Bulb.

If they want killer branding design with great copy, I send them to Reese and Kelly Parkinson.

If they know what to do but get paralyzed by procrastination, overwhelm and creative blocks, I send them to Charlie Gilkey.

If they decide they don’t want to start a business after all and want to get a job, I send them to the best career coach I know, Michele Woodward.

And if they are incredibly difficult to work with, I send them to John Jantsch. (Just kidding John! J)

Knowing I have world-class business partners who will not only deliver excellent service to my clients but will also be fun and easy to work with allows me sell my strengths and refer the rest. My clients are happy, I am happy, and my circle of partners is happy. Our combined networks generate lots of new business, and many opportunities to collaborate on programs, products and services.

How can you bake a great referral network into your business model?

  • Define the problem your clients are trying to solve. Are they trying to start a business? Make more money? Simplify their life? Build a product?
    Break down all the knowledge and support they will need to solve the problem. Think about which tools they may need, which decisions they have to make and what skills and competencies they require.
  • Identify your strengths. As you examine all that’s needed to solve their problem, think about what you love to do, what interests you, and where people say you excel.
  • Structure your services around your strengths. If you love doing big picture strategy and get bored with implementation, don’t offer that service. By focusing only on what you do best, you will set yourself apart from so many others who struggle to provide everything to everyone.
  • Identify ethical, competent people who are great at solving the rest of the problem. Use your personal networks, social networks and research to find excellent referral partners. Watch closely the first few times you send a client their way. Make sure they deliver great results and make your clients happy. After awhile, you will send them business with your eyes closed. And they will do the same for you.

Baking referrals into your business model will not only grow your business, it will make your brand shine. As Miguel de Cervantes said in Don Quixote:
“Tell me what company you keep and I’ll tell you what you are.”

Pamela Slim is a business coach and author of the award-winning book Escape from Cubicle Nation. Find her at www.escapefromcubiclenation.com and follow her on Twitter @pamslim

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  • http://twitter.com/kellylivesay kellylivesay

    I know for a FACT that Pam does this in business because, as an act of generosity, she once spent 15 free minutes on the phone with me (a complete stranger) when I was faced with talking to a big name client. She told me then, and I never forgot, “if you can't do the job yourself, refer them to someone who can and they will remember you”. I've offered my own smallbiz referrals on Twitter! Hugs, Kelly

  • http://www.hariombalhara.blog.com/ trips in city

    Perhaps they felt it was the only way to respond to GitHub (SourceForge has long ceased to be relevant, even if it still has a huge legacy installed base).

  • http://www.hariombalhara.blog.com/ trips in city

    I think Zumobi started as a WinMo / Berry shop but dropped them and went full-on iPhone. Recently they started developing apps for Palm, Android and (one again) BB.

  • http://www.adrianswinscoe.com/blog/ Adrian Swinscoe

    Hi Pamela,
    Great suggestions and all about building positive links around you. We do it in our business and it works a treat. We learnt sometime ago that delivering value for the client does not necessarily mean us it just means delivering value period. If that means referring that client to a contact who is better placed than us then that is a huge value add for them and, ultimately, for us.

    Adrian