The JF Guest Author Spot

Paul McCord

How often have you heard of someone giving a client or prospect a few business cards, request the client give them to anyone they meet that might be able to use the salesperson’s products and services and then have the salesperson claim they are seeking referrals?  Often in my seminars I’ll have salespeople tell me that they are referral-based because they have clients hand out a card on occasion or the store up the street handed a customer one of the salesperson’s fliers and suggest they call the salesperson.

This is not referral selling.  Rather it is Word of Mouth Marketing.  The two are very different.  Moreover, if a salesperson seeks to market using both methods, they can harm their efforts if they don’t know the difference and use each properly.

The corporate goal of Word of Mouth Marketing (WOMM) is to create “buzz” among potential customers and help brand the product or service.  Companies spend millions of dollars to create the “spontaneous” buzz about their goods or services. 

For the individual salesperson, professional or small business owner, the goal of WOMM is far more modest.  The corporate goal of creating discernable buzz and helping to establish a brand generally isn’t realistic—the costs involved are simply too great.  Consequently, the WOMM goal of small business is to help drive more customers and clients into the pipeline.

There are a number of strategies that one can use to help promote their word of mouth marketing efforts.  The most obvious we’ve already mentioned—giving a stack of business cards to a client and asking them to pass them out.  Others include leaving business cards or filers at various businesses, hoping the employees in the store will suggest you and pass on the cards or filer.  Or, you can give your cards to family, friends, acquaintances and others, again hoping they’ll pass them on to people who might be able to use your products or services.  You can give your product or service to a few “influential” users who might be willing to spread the word.  Some have even resorted to going to on-line forums and posing as satisfied customers to give recommendations to those on the forum.

The object of the word of mouth marketing campaign is to get people to become your mini prospecting force.  The theory is if you get enough people carrying your word for you, you’ll realize an increase in sales from their activities.  Although you would hope to create real “buzz” like the major corporations, realistically, your goal is simply to increase your exposure and add some prospects to your pipeline.

Word of Mouth Marketing is a passive prospecting activity.  You simply seek to set the stage and then have others work as your prospecting force.  You control to a large extent whom you seek to enlist as part of your prospecting force, but you have little or no control over the results.

Referral selling, on the other hand, is a very proactive process.  You’re not relying on anyone else doing the work for you.  Rather your goal is to have your clients and prospects identify individuals or companies that they know and have some kind of relationship with that they believe might be able to use your products and services and are willing to introduce you to those individuals or companies.

While you have little or no control over WOMM, referral selling requires you to maintain complete control of the process.  You must fully prepare your client to give referrals, you must give your client a good reason to give referrals, you must earn the referrals by giving the client the exact purchasing experience they desire, you must know who your client knows and determine whom you want to be referred to, you must fully understand the relationship between your client and their referred prospect, you must contact the referred prospect in a manner that gives you the best opportunity to set an appointment, and you must keep your client informed of the process with the people they have referred you to.

And although it is possible to enlist both marketing methods within your business, if you’re not careful, you can do serious harm to your referral selling marketing if you enlist certain WOMM strategies.

For instance, you should never give extra business cards to a client and ask them to pass them out.  Rather than having your client pass out a couple of business cards to people who may or may not call you, you want your client to introduce to that person.  You want to retain control.  You don’t want the other person to have the choice to call or not—because many will not call. 

Giving your product or service to influential people in hopes of getting their endorsement and having them spread the word can be effective, but not in the traditional corporate format.  Corporations give product and service to influential people hoping they will help generate the buzz they are seeking.  Your chances of creating real buzz are minimal to non-existent.  Your goal isn’t buzz but clients.  Therefore, instead of giving the product or service away and then sitting back hoping for the word to spread and investing millions in a marketing campaign featuring these people, you must treat them like any other client and work with them to acquire direct referrals to other individuals or companies they know. 

A corporation may gain an endorsement by Terry Bradshaw, Martha Stewart or Jack Welch and then spend millions of dollars getting the word out that these people use their product or service.  Unless you have the same dollars to spend, you can’t afford to have them simply endorse the product.  You must have them directly introduce you to those they personally know—you have to have a direct referral in order to get significant results.  You may not be able to get Bradshaw, Stewart or Welch on your team, but there are others in your local area that have significant local influence that you can approach and turn into referral machines.

As small business people with limited funds, we must find the most effective methods of marketing.  Learning from and emulating the methods used by major corporations can be very effective—but each method must be modified to the realities of small business.  WOMM in the traditional format is not inexpensive, but is highly effective on a massive scale.  We must learn to take those methods and adjust them to our budgets and make them effective for us.  That means not only implementing them on a small scale, but making them personal and formulating them into a proactive method where we can retain as much control of the process as possible.  Converting WOMM methods into referral selling methods is both cost effective and highly profitable. 

Paul McCord is the president of McCord and Associates, a Houston, Texas based international sales training, coaching, and consulting company. He is the author of the Amazon and Barnes and Noble best-selling book on referral generation, Creating a Million Dollar a Year Sales Income: Sales Success through Client Referrals (John Wiley and Sons, 2008), and SuperStar Selling: 12 Keys to Becoming a Sales SuperStar www.powerreferralselling.com

Today’s News: You can spend a full hour listening to Paul’s words of wisdom today

Mining the Gold In Your Database 
Hosted by Paul McCord 

Although generating referrals from clients and customers is by far the best prospecting tool any salesperson has, less than 15% of ALL salespeople generate enough quality referrals to impact their income and sales.  Why?  Because everything they’ve been taught about asking for referrals is WRONG!  Yet, the mega-producers have built their huge sales incomes almost exclusively from referrals.  Learn how to use and implement the techniques the mega-producers use that REALLY work.  You too can get 5, 6 or more high quality referrals from each of your clients by learning the methods the top referral pros use.

Tuesday, 27 May 2008, 01:00 PM — 02:00 PM (6.00PM – 7.00PM GMT) BOOK HERE

Tomorrow: If you negotiate, and most of us have to, then you will be interested to learn of the different negotiating styles and how they affect the final outcome.

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