"There is a wrong way and a right way to ask for referrals" - Discussion with John Smibert.
Tony Bonanno claims that many sales people waste time asking for referrals. I asked him why.
Tony said that most people get a very low response rate when they ask for referrals. That's because the question is not being asked in the way that makes it easy for the respondent to identify who might have a need for your product.
He told me that most people ask their customers "Who do you know who needs my service?".
He said that when you ask somebody this question, you're asking them to make a value judgement about other people or businesses, and they don't necessarily know the answer.
There is a better way to ask that will make it easy for people to identify a prospect for you.
So what is the correct way to ask for a referral? View or read the interview below for the answer.
Tony Bonnano is a thought leader in sales management, sales growth and behavioural change
See more of the 'TALKING SALES' series here
John: Hello, I've got Tony Bonanno with me again - welcome back, Tony!
Tony: Glad to be here, John!
John: Tony, getting referrals is a very important part of building pipeline, getting more and more prospective customers into the funnel.
John: I've heard you say that some people just waste time asking for referrals. What do you mean by that?
Tony: I have seen people waste a lot of time in the referral generating process. For me it started in my childhood, when my father had an insurance rep around selling life insurance, and they had a discussion and they signed some papers, and at the end of the process the rep pulled out a little 3 x 5 card and it had three lines on it, and he put it in front of my dad and he said, "Who do you know who needs life insurance?" Dad picked up the card, he thought about it for a moment and he said, "I can't think of anyone," and he was telling the truth. Over the years I've seen... when I've been out on calls with reps I've seen many reps do something similar, saying, "Who do you know who needs what it is I'm selling or serving?" and all the rest.
John: So, what should that insurance broker have actually asked? How should he have done it differently?
Tony: To understand the answer, let's understand the psyche behind the question. When you ask somebody, "Who do you know who needs my service?" you're asking them a value judgement about other people, and they don't necessarily know the answer to that.
John: Or they don't want to.
Tony: Perhaps they don't want to, but certainly my experience shows that most of the time they don't know, and so that stalls the process. If you think about it as a salesperson, I would have a reasonably well-defined profile of who my target customer would be.
Tony: That's not hard to do, you can go back and look in your records and work out who's my A-class client, profile them and all the rest.
John: We teach that all the time. If you don't know who your best customers are and best target customers are, then you're wasting your time even prospecting at all.
Tony: Exactly, so look what happens when we do that. And the reality is, we take that, we then go and market and advertise to that demographic, but we don't do that when we ask for referrals. I would be far better off taking that profile, putting it in front of you and say, "John, who do you know who fits that profile?" It's a much easier question for you to answer, in particular because you don't have to make a value judgement about the people in that profile.
John: Okay. Give me an example. If I'm selling business solutions to businesses out there, how might I go around asking?
Tony: So, your A-class profile might be that it's a company that's got 500 staff, it's in the services market, it's in a particular vertical or whatever, so you've done the profile. Then you'd come along to me as a perfectly satisfied client...
John: And define that type of customer from that point of view.
Tony: Absolutely, yes. So, you'd first make sure that I'm happy with your service, because if I'm not happy with your service I'm not going to give you anything, but once you're happy that everything's right you would say, "I need your help. Who do you know who'll ~sell it~ a bit like this?" and you would then help and prompt them through that process of identifying companies and organisations that fit in that profile.
John: I understand what you mean. The alternative is I'm asking you, "Who do you know that could use my product?" and they're probably not going to answer the question or won't know.
Tony: That's right.
John: Okay. So, the profile of your target customer, your ideal customer, let them know who that is, and they're likely to know some organisations and some people in those organisations.
Tony: And they do, they absolutely do. I mean, I use that all the time. My best ever result was 27 handwritten notes of introduction to a list of 27 people that fit the profile.
John: Okay, that's the way to go.
Tony: It works.
John: Alright. Thank you very much, Tony, I really think that's great advice. Profile your ideal target customer, and give that profile when you're asking for referrals.
Tony: That's the way to do it.
John: Thanks, Tony - appreciate it!
Tony: Thanks, John!
More interviews with Tony Bonanno:
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