It is clear that the business community is in unchartered waters, many of us worked through the last recession and know how tough it was to stay afloat, business opportunities in certain industries were extremely hard to come by. We now need to start thinking that the methods that have served us well over the past few years may have to change.
Taking some of what we learnt before will serve us well to a point, but we’ve been introduced to a world where human interaction is different, we are not allowed to embrace people we know well to show any type of appreciation or welcome people we’ve just met with a formal handshake. That said business relationships will play a vital part in driving economic recovery and we may need to re-evaluate our approach to ride the recovery. We may be seeing the next paradigm shift?
What is a paradigm shift?
“A paradigm shift is a major change in the concepts and practices of how something works or is accomplished. A paradigm shift very often happens when new technology is introduced that radically alters the production process of a good or service.
In the business world, a paradigm shift is often a change in the perception of how things should be done, made, or thought about. Reacting well to key paradigm shifts have a lot to do with the long-term success of a business.”
Will Kenton on Investopedia
One example of this is Zoom, Teams, Google Meet, technology that has undoubtedly changed the way we do things and is something that nearly all of us have experienced. I genuinely believe this to be only one part of a bigger picture. The key ingredient will be the way in which we build, manage and seek to profit from solid, lasting relationships, yes with our customers but just as important are the relationships we develop with our entire network both online and offline.
Understanding the root of how quality referrals can appear from your network is vitally important when understanding how we should change our behaviours.
Based on the commonly recognised business principles of Know, Like, Trust (KLT) I believe that Referral Marketing best practice can be considered as the “5 R’s” of Referral marketing. It basically serves as a reminder of the behaviours we should display when interacting with our network:
- Responsibility (Know)
Think about your current situation, are you doing everything you can to improve who you are and how you communicate with everyone you come into contact with? It is important to be both open minded and enthusiastic, combining these behaviours with an attitude to continuous learning will add value to your network and form the basis of a solid relationship with those around you, as they will know who you are and what you’re about very quickly.
- Relationship (Like)
It goes without saying that being likeable puts those around us at ease and will help us to find common ground with a much wider audience. When we’re on a mission to build a business or sustain continuous growth, the issue is that we can easily forget about relationships with the other people in our network that are not our customers. In doing so we are potentially cutting off a profitable route to market. My advice therefore is to be professional, friendly and compassionate with everyone that we meet, you never know where things could lead.
- Reputation (Trust)
How many times do we hear people in business say that you should stay true to your word? But time and time again I see this advice ignored or forgotten. Broken promises are often the root cause of resentment. Your reputation and that of you brand is key to the development of long-term relationships and to develop your referral network.
It is also vital that any recommendations or referrals are rewarded, whether it be a simple thank you or paying out on a promised incentive, just make sure you complete the loop.
In the context of referral generation, it is fairly obvious that reciprocal leads are at the top of the referral marketing tree. I believe however that reciprocation in business can mean so much more, you can help people in so many other ways.
Providing professional advice to help others succeed, going out of your way to connect people to each other, giving someone a lift somewhere, listening to your contact’s personal issues and responding in a compassionate manner it all counts towards building profile as someone who everyone should do business with.
You may also want to consider the fact that if you don’t trust people how do you expect them to trust you!
In business we generally apply the term “retention” to our customers and often bigger businesses have specific metrics such as NPS (Net Promoter Score), customer churn and repeat purchase ratios to measure success. I believe that this type of thinking needs to be extended to cover our referral partner network, appreciating who our best referrers are and how much value they bring is the first step in the process of understanding how to incentivise them (to bring you more referrals).
Avoiding resentment is also key, I frequently see business relationships breakdown due to perceived or proven inequality in referral relationships.
“I gave John £10k worth of business over the course of last year, John gave me nothing. That’s the last time I give anything to John!”
This scenario can easily be avoided, basic reporting and instant rewards for referrals will introduce consistency and transparency to the referral relationship and as long as you stay true to your word, develop a much longer-lasting relationship.
Tim is the MD and Founder of Incentive Manager, the free to access referral marketing platform, designed to support business growth by forming transparent and profitable relationships.
Using 20 years of experience, including senior marketing and business development roles in large corporates to setting up and running his own businesses, he has through Incentive Manager opened up one of the most under-utilized channels to market.
You can reach Tim directly firstname.lastname@example.org