The Number One Mistake People Make When It Comes To Referral Marketing

Marketing podcast with Bill Cates

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Everyone loves referrals, but let’s face it – the real point of a referral is a customer. If you’re getting plenty of referrals, but few are turning into new clients, it’s time to change a few things about your approach to referrals.

referral introduction

photo credit: Jeremy Wilburn via photopin cc

The number one mistake people make in the business of referral generation is to ask for leads or referrals when they should be asking for introductions.

So many people seek referrals by simply asking clients, or anyone that will listen, if they know anybody who needs what they do. If the referral source can come up with a few names we’re often tickled to have some new “leads” to go chase.

But, what do we really have? Something less than cold call – maybe. Sure, we can name drop, “Bob said I should call you.” But, we’ve all been on the other end of that call and know how that usually ends up.

If you want to make referral generation a significant part of your marketing success you need to start asking for introductions and not simply a list of names. You need to build the trust and leverage that would allow you to ask a client to introduce you to three others that could benefit from the value you bring.

In this week’s episode of The Duct Tape Marketing Podcast I visit with Bill Cates, author of Get More Referrals Now and the upcoming Beyond Referrals. Bill has spent many years coaching financial professionals on the fine art of authentic referral generation and in this segment he shares some well tested tactics.

The key to generating introductions is to make it as easy as possible for your referral source to do so. Offer a list of specific prospects you would like to meet and see if they know anyone on the list. Offer to host an informal educational workshop and allow your best customers to bring a friend or two. Take a handful of customers to lunch and ask them each to bring a guest.

Cates mentions a former client that would ask his clients to introduce him to two colleagues who would take his call just because they asked them to.

Getting your customers or contacts to rise to the level of engagement required to make introductions or bring a friend to lunch requires a level of value that few can muster. This is the key to making this idea work. You must bring value to every interaction, conversation and setting.

When you can do this, people will gladly introduce you to others. When you change the context of a referral to that of an introduction you automatically raise the stakes for all parties and that’s the place where you can do your magic.

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  • Jeff Epstein

    Great post John – looking forward to checking out the podcast!

    Another great way to “make it easy” for customers to refer new business (and perhaps to even reward them for doing so) is using web based software.

    I’m the founder of Ambassador ( and our software helps companies automate the tracking & management of referrals.

    Thanks again for the great content as usual!

  • Bob Strassel Jr

    John, Great post! I can’t think of a more relevant and timely post. In a time where everyone talks about leads, I think that more often they don’t convert because of lack of a personal connection. If someone is good enough to introduce you, it serves as a powerful statement of trust. With all of the clutter in sales and marketing I think nothing is more powerful (and possibly pre-qualified) than a great introduction. Ask for the intro! – Bob

    • ducttape

      Thanks Bob – I think the thing that holds people back is fear – it takes a lot more guts or maybe confidence in what you bring to ask for the introduction – it’s too easy to give leads without any commitment – an introduction means they truly value what you do and is a good measure of your success.

  • Scott Ayres

    Yeah there is nothing worse than meeting someone and they immediately ask “So do you know anyone that would be interested in XYZ?”.. It’s better to tell them what you offer and make it clear what your ideal customer looks like. Then they can decide who best to refer to you later.

  • angelina Dom

    Great post, Thanks for sharing this with us according to me we should go ahead with complete preparation in mind that you are not in the marketing standing there and someone and hit you the question you at once and you don’t know what you reply so we must keep these point in our mind as we have to go keep these points in our mind and thanks for just revised all these in my mind

  • Your City Office

    Asking customers to bring friends to lunch. That is something I have done in the past, and I can speak to it being very effective. People are a lot more disarmed when they’re eating (especially on someone else’s dime). The cost of a prime rib for an interested new client is a lot less than you pay for many other marketing techniques.