Small Business Marketing: The Truth About Building a Referral Based Business

During the first five years of my business, I lived and died for referrals. I would do anything to get a referral because everybody was telling me that was the best way to get business. I read about this multiple marketing books and heard about it from several highly-successful speakers. It was sold to me as the golden gift of marketing. I thought "Gee, it doesn't cost anything. It's easy. It doesn't require arm-twisting. It's the way for a business to survive." Then about a year ago, I heard an interview with a former Microsoft executive that really changed my mind about referrals. In essence, he stated that referrals are one of the worst forms of marketing because you cannot predict your business. You never know when you're going to get a call, how much income you're going to have, how long of an engagement or how good of an engagement it will be. After reflecting on this marketing twist, I realized that referrals are really not the golden answer. They are one form of marketing and sales, but not the only one. If you rely solely on referrals in marketing and sales, you're waiting for the phone to ring. You're waiting for somebody to knock on the door. You're waiting for somebody to walk into your office. Unless you have written a top 10 bestseller business book, it's not going to happen - especially if you're brand-new and just starting out. Referrals are great, but don't rely on them. Have other forms of marketing available to generate business. Increase your visibility, build your brand, and demonstrate your expertise. These are critical. Marketing is not just a one-time event. It's an ongoing sales process that can help you bring in a constant stream of business. Here's a simple easy to understand 5-step process that will greatly help you decide how best to approach my target audience: 1. Prospects Know You: People get to know you through visibility. Build your visibility by speaking, blogs, articles, etc. 2. Prospects Like You: Put out quality information that appeals to the wants and needs of your target audience. 3. Prospects Trust You: Put out great information and provides value to your audience. When people begin to see the benefits of working with you or reading your materials, they trust you. 4. Prospects Buy You: Bring them to the point where they want anything that you offer because they know it's the gold standard; the information is good and that it's going to benefit them. 5. Clients Retain You: Your clients and customers continue with your services and come back because they know the quality and results are there. Build visibility so that your business is not 100% reliant on referrals by having multiple forms of marketing - speaking, writing, joining professional associations, blogging, organizing a Facebook group, etc. Instead of relying totally on referrals, think of them as a gift or bonus for your marketing efforts.