When ever we conduct a prospecting workshop, we ask how many of the participants typically sell to referrals they garnered; usually about 20% of the group raises their hand.  We follow up by asking how many proactively seek referrals, and no surprise, the same 20% raises their hand.  The obvious conclusion is that if you make it part of your day to day routine it will pay dividends over and over.

Despite this referrals remain an interesting phenomenon in sales, everyone is aware of their value, everyone insists it needs to be part of every sales professional’s tool kit, yet like getting the flu shot very few do more than talk about it; and even those that do utilize referrals for lead generation, don’t always do it in a way that allows them to fully monetize their efforts and opportunities.

I want to look at one specific aspect of referrals, one that generates discussion with even those who are in the 20% mentioned above, that is, when do you ask for referrals.

Most people we speak to respond that they only ask for referrals once they have closed the business and the prospect has been converted to a client.

This type of approach has a number of flaws, first why wait for a chance to find about potential prospects till after the entire sales cycle.  If you can be referred to a real prospect would you not want to engage with them as early as possible?  Second, if you only close one out of three prospects (which would be considered great by most B2B standards), the implication is that the referrals that the two non-converted prospects could have provided will never be tapped.

We encourage sales professionals to take a wider view.  When asked why they wait to ask after the prospect has become a client, sales professionals say that they feel that they have then demonstrated and delivered value, and have gained the client’s trust.  While I would not disagree, the criteria they use are present before a deal is complete and therefore can be capitalized during the sales not just after it.

At a most fundamental level we feel that trust is established and gain long before the sale is complete, I would argue the sales would not happen without trust.  That being the case and the fact reps say they want trust to be present to ask for referrals, it goes to follow that they can and should asking for referrals when trust is established, not when the sale has been completed.

Similar arguments can be made about value, both in terms demonstrating value and delivering value.  As we have stated before, as a sales professional you are a subject matter expert, often as qualified and informed as your buyers, with the added advantage of seeing best (and worst) practices from a cross section of companies.  As such you are in possession of a wealth of knowledge that could be of value to a prospect, long before they buy, or even when they don’t buy.

Have you ever sat with a prospect, and as a result of your professional interview skills, you discuss a key topic, and at one point you find that you have been able to positively challenge assumptions the prospect had?  And as a result they thank you pointing that out.  I would argue you have delivered value, and value has been acknowledged.  As a result you have earned the right to ask: “Well, I glad you see it that way, who else do you know that may find this type of discussion (approach, methodology) of value?”

How many times have you had a prospect say?

·         “Wow, that’s great”

·         “Thanks for fixing, addressing, changing…. this”

·         “I wish I knew that 2 years ago before we started…”

·         “I didn’t know you could that”

Each of those is acknowledgment of value, each of those is an opportunity to ask the prospect for a referral before the become a client.

Let’s remember that there is no guarantee that the prospect will in fact give you a referral right away, but you have to ask.  If they do in fact give you a referral, bingo.  If not, and the do become a client, you have set the expectation that you will ask and accept referrals.  This clearly works better in some verticals than others, but in all sectors and segments, you need to start asking for those referrals right out of the gate, rather than after the close.