Did you know that the average company drives up to 50% of their revenue with referrals from previous clients?
For some builders and remodelers, it can often be much higher than that — even up to 100%.
Have you ever stopped to consider how truly incredible that is? Or, just how much time and money that saves your business?
To bring this into perspective, those new clients being sent your way from referrals means that you don’t need to spend half of your day ... week … or, year, selling and hunting for new revenue. That’s extra time you can spend completing more projects and money saved that can be added to your bottom line.
Now, it’s important to acknowledge the role you play in all of this. If you’ve earned even just ONE new client from a referral, it’s because you did something to deserve it. I mean, it’s not like people just randomly endorse a company without a good reason.
In fact, in order for someone to provide you with a 5-star review or recommend you and your company to another person, their experience has to be exceptional. In other words, in one way or another, you exceeded their expectations.
And, this isn’t always easy to do. Amirite?
So, before we go any further, take a moment to give yourself a pat on the back if a client has ever been referred your way. You’ve earned it.
Let’s say that you had 100 projects last year, 50% came from referrals and 50% came from advertising and sales. Your goal for next year is to double it.
So, how are we going to do that?
The most logical thing that comes to mind for most is usually, I need to run more Facebook ads, or I need to make more sales calls, or I need to double whatever tactic that worked before.
Those approaches aren’t wrong per se, but there is a better (and much less expensive) way to double the size of your business.
And, not only is it the biggest … but it’s also the most effective and profitable way to get new clients.
But, don’t just take my word for it:
Regardless of whether you’re an independent contractor or national home builder, word-of-mouth recommendations and referrals are the key to building a highly-profitable and sustainable business. Plain and simple.
As I mentioned previously, referrals are not just given, they are earned. It’s important to understand that when someone recommends you to another person, it’s more than just a referral they’re offering — it’s also their reputation.
So, before you begin working on increasing client referrals, you first need to see if you’re doing what it takes to earn them. The easiest way to figure that out is by looking at how much of your revenue today is driven by client referral. If it’s minimal, you may need to take a hard look at what’s missing and make the changes required to improve client happiness.
If client referrals are already a part of your business today, increasing them to grow your business is just a matter of knowing what to do. There are three core areas to focus on:
There you have it — the same principles used by some of the most successful businesses in the world today. The great part is, focusing your attention inwardly in this manner not only helps grow your revenue, but you end up building a brand strong enough to span generations.
It’s said that up to 50% of all buying decisions that people make are made based off of word-of-mouth recommendations. What are you going to do to capture them for your business?