How Do You Reward Your Contacts for Referrals They Give You?
This is the million-dollar question.
How comfortable are you about rewarding customers and contacts that give you referrals? If you do reward them, is it in monetary term or something more tangible?
In my travels, I’ve found that formal networking groups, such as BNI and BRE tend to pass referrals amongst themselves with the attitude of givers gain. In other words, you pass referrals to members with the hope that they would reciprocate and give you referrals. This system works for many thousands of business people every day across the globe. So if this works for you, keep at it.
On the other hand, some businesses are so reliant on good quality referrals for high-value products that they are happy to give an introducer’s fee. For example, property companies selling new-builds earn a high enough commission from each sale that they are willing to pay good commission. Financial advisors also offer monetary incentives to introducers.
If you are considering offering financial incentives for referrals, make sure the value of the sale is sufficient for you to warrant such a reward. Giving your profit margins away just to get the sale defeats the objective of being in business.
You may also want to establish if this kind of practice is ethically acceptable in your industry. For example, you would be crossing the legal boundaries if you offered financial incentives to doctors in the UK for giving you referrals. You’d have to find a more creative way to motivate such people.
I have tended to shy away from giving financial rewards for referrals. I compare it to giving money to a member of my family on their birthday instead of giving a gift. It shows a lack of creativity and thought on my part and, as humans tend to be so fickle, people tend to forget your monetary gift a lot quicker than if it were a tangible present.
My preference is to either give back awesome referrals or give a physical gift or I’ll invite them to a private dinner party. In the case of the latter, the gift is an experience for the recipient to mix and mingle with highly connected and respected individuals.
So, use the next seven days to think about how you can inspire and motivate your contacts by rewarding them with a simple gift that you are both comfortable with.
Want to find out more about how you can boost your business referrals, then why not book yourself for the Referral Sales Summit on Tuesday 27th June 2006 in Birmingham, UK?
How comfortable are you about rewarding customers and contacts that give you referrals? If you do reward them, is it in monetary term or something more tangible?
In my travels, I’ve found that formal networking groups, such as BNI and BRE tend to pass referrals amongst themselves with the attitude of givers gain. In other words, you pass referrals to members with the hope that they would reciprocate and give you referrals. This system works for many thousands of business people every day across the globe. So if this works for you, keep at it.
On the other hand, some businesses are so reliant on good quality referrals for high-value products that they are happy to give an introducer’s fee. For example, property companies selling new-builds earn a high enough commission from each sale that they are willing to pay good commission. Financial advisors also offer monetary incentives to introducers.
If you are considering offering financial incentives for referrals, make sure the value of the sale is sufficient for you to warrant such a reward. Giving your profit margins away just to get the sale defeats the objective of being in business.
You may also want to establish if this kind of practice is ethically acceptable in your industry. For example, you would be crossing the legal boundaries if you offered financial incentives to doctors in the UK for giving you referrals. You’d have to find a more creative way to motivate such people.
I have tended to shy away from giving financial rewards for referrals. I compare it to giving money to a member of my family on their birthday instead of giving a gift. It shows a lack of creativity and thought on my part and, as humans tend to be so fickle, people tend to forget your monetary gift a lot quicker than if it were a tangible present.
My preference is to either give back awesome referrals or give a physical gift or I’ll invite them to a private dinner party. In the case of the latter, the gift is an experience for the recipient to mix and mingle with highly connected and respected individuals.
So, use the next seven days to think about how you can inspire and motivate your contacts by rewarding them with a simple gift that you are both comfortable with.
Want to find out more about how you can boost your business referrals, then why not book yourself for the Referral Sales Summit on Tuesday 27th June 2006 in Birmingham, UK?
posted by Harun 'The Persuader' Rabbani at 7:38 pm
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