Last week we talked about the five of the reasons to have referral partners in your business – this week, we’re focussing on how you make referral partnerships work so they are of benefit to everyone involved.
It is important to identify partners that make sense.
What do we mean by that?
If you are going to work with a referral partner then you need to consider who they can refer to you and the best way to do that is to look at their customer base.
Are they targeting the same people as you? Do you share a target market?
To make referrals easy you need to have a common customer in mind and be offering complimentary and not competing services/products.
Another key thing to consider is how aligned your values are. Think about this in terms of the customer experience. If you refer a client to your referral partner will they receive the same level of service that they have come to expect from you? These are a really important starting point to identifying partners.
When you decide to work together make sure that you are both clear on the outcomes you want from entering into a referral partnership. For example, are you looking for a set number of referrals each month, are you looking for financial rewards, do you want to host events together or market to each other’s customers?
Understanding what makes this a win win for you both will make the process easier moving forwards.
Meet regularly to build trust. If someone asked you to recommend a place to eat would you recommend somewhere you had never been to before? Chances are you wouldn’t, so why would you refer a client to someone who you had never met before?
Establishing a relationship helps to build trust on both sides and build an understanding of each other’s businesses, which makes talking about them to others a more effective process.
It’s easy to sit and talk about who you want to work with but it is a really crucial part of a referral partnership to understand who the other person’s ideal client is and therefore what makes a good referral but also what makes a bad referral – who might on the surface of it seem like a good fit but in reality they aren’t the type of customer you want to work with.
Finally, you should make sure that you establish what your referral partnership agreement is.
Similar to understanding the outcomes you are both looking for you should also agree whether there are referral fees involved or is this a more informal agreement. Make sure you are both on the same page with this before you start passing referrals.
Getting the foundations of a referral partnership in place early on will develop a stronger and longer lasting relationship.