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Why Your Account Based Sales Team Will Never Be Good at Referrals

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Account based sales Does your sales team struggle to get referrals? Here’s why.

When I read a checklist of account based sales development strategies that omitted referral selling, I asked the creator why. After a long pause, her response was, “I don’t know.” That sent me over the top.

It also made me curious: Why is it that posts about lead generation for account based sales never mention referrals, but tout emails, phone calls, videos, custom content, direct mail, social media, ads, webinars, events, testimonials, case studies, etc.?

I posted that exact question on LinkedIn and received 35 comments and more than 31,000 views. Such a hot topic seemed worthy of sharing on my blog. Below are the answers some people proffered to my question … and my response to their ideas:

Reason #1: New school techniques are being touted as a replacement for old school. Too many sales pros chase the bright, shiny social media stuff rather than doing the tough strategic thinking needed to optimize a referral selling system.

I agree. Everyone is searching for an easy way out. What’s the fastest way to learn, the fastest way to get someone to return a call, the fastest way to locate the most relevant article, the fastest way to coach reps, the fastest way to …? Well, you get the picture.

Sales leaders don’t take time to implement a referral system. They just want a quick fix that doesn’t cost a lot, and they convince themselves that will be good enough to generate qualified leads. No, it won’t. You know the saying: Good, fast, cheap—pick two.

There are no shortcuts to account based sales development, and no technology solution replaces building trusted relationships. That’s why referral selling is the only sales strategy that delivers a 70 percent conversion rate. But to get those results, sales leaders must be willing to invest time and money in a referral system that includes a referral strategy, referral skills, referral metrics, and accountability.

Reason #2: Salespeople aren’t asking for referrals—even though they know it gets them in the door more quickly—because they don’t follow a process and make it part of their selling habit. Even if they do ask for a referral, it is a generic ask (i.e., “If you know anybody …”). They need to be trained in how to ask for referrals successfully.

I couldn’t have put it better myself. Referral selling is a skill and a behavior change for account based sales reps. Skills don’t get built overnight. Changing behavior isn’t easy. It takes time, focus, and reinforcement—just like any skill. And unless asking for referrals is an organization’s #1 outbound prospecting strategy, sales teams will revert to their old habits: cold calling and occasionally asking for referrals to “anybody.”

Reason #3: Salespeople are not measured on getting referrals. Sales leaders spend more time measuring reps on calls made and emails sent. So, if a rep isn’t measured on referrals, but they are measured on number of calls made/emails sent, that’s where they are going to focus their time.

This is one of the main reasons referrals don’t work. Sales leaders tell their teams to get referrals, but their KPIs don’t include referral activities or results.

Many sales leaders believe that referrals can’t be measured. That’s misinformation. Referral metrics include activity metrics and results metrics. Activity metrics are what matter. Results metrics are a lagging indicator and can’t be managed. You can manage to these activities: number of people asked, number of referrals received, number of meetings scheduled, number of meetings conducted, close ratio of referred leads, and the total revenue from referred leads.

Reason #4: Most salespeople, trainers, and sales leaders assign referrals to the bottom of the funnel (the done-deal referral) and miss out on the true potential of referral based sales.

I love this one. Actually, I think the funnel is the wrong image. A referral introduction ensures only qualified leads enter the top of the funnel. We can ask for referrals anytime during the sales process when we deliver value, not just when we’ve closed deals. How do we know we’ve earned the right to ask for referrals? Clients thank us for an insight or for our guidance. Many times we’ve saved them from making moves that could cost them their jobs. Powerful? You bet.

Reason #5: Referrals are not always easy to obtain. Salespeople and companies need to work hard to please their customers to earn the right to ask for the referral. Your own happy customers can be a source of referrals and introduce you to others who can use your services, especially to their own vendors and clients. They won’t do it, though, if you haven’t earned it.

It would be great if happy customers referred us all the time. Sometimes they do. But they’re busy running their businesses, and we’re not top of mind for them. Therefore, if we don’t ask for referrals, we very rarely get them. Top account based sales reps don’t sit back and wait for leads to come to them. They’re constantly asking for referrals. As for earning the right to ask, see my response to the previous question.

Reason #6: When you ask for referrals, it makes you vulnerable because you don’t know what they are going to say. We are essentially asking the customer to overlay their brand onto ours with a referral or recommendation. Performance, trust, and integrity are a must to get this gold standard introduction.

So true! The main reason account based sales reps don’t ask is the fear of rejection. Referral selling is the most personal sales approach of all. We put our reputations on the line. It would be devastating if someone refused to introduce us. So, we don’t ask. That is, unless we’re trained to know who, when, and how to ask in a way that gets results.

Reason #7: Referrals are hard.

This reason isn’t from one of the comments on my post. It’s from me. And it’s what all these other reasons boil down to. Referral selling is simple, but not easy. It’s a strategy and a discipline with metrics, skills, and accountability for results.

Referrals don’t just happen, at least not at scale. But rest assured, referrals do scale when you have a system in place and it’s your team’s #1 account based sales development strategy. Your salespeople miss the opportunity to generate only qualified leads if they don’t ask every single person with whom they connect during the buying process. And they won’t ask if you’re measuring them on the number of dials they make, emails they send, and activity on social media. Clicking buttons is easy. Measuring the clicks is easy. But your chances of getting sales that way? Nowhere near 70 percent.

Sales leaders think they’re already “doing referrals” for their account based sales teams. They think they can just tell their account execs to go out and get referrals. They want “easy.” But easy doesn’t work. Referrals do.

Referrals are the #1 way to grow both revenue and profits. When reps get referral introductions, they get every meeting in one call. Referred prospects actually want to hear from your team. Your reps get in early with the right person, develop relationships, clarify the need, and set the standard by which others are evaluated. Did I mention that your competition is toast?

Ready to put a referral system in place for your team? Learn more about the #1 Referral Selling Program for Account Based Sellers.

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2 Responses to Why Your Account Based Sales Team Will Never Be Good at Referrals

  1. trish says:

    Perhaps one reason you received that reply is because the sales development rep rarely has a network at the level they are calling in to which makes referrals nearly impossible. In the Account Based Revenue strategies we execute for our clients the entire organization from the BOD through the entire organization is scoured for possible connections before any Plays are launched. Account Based strategies, when done well, are an orchestrated motion in which many players have a role. It is NOT driven by the sellers.. they are but one of the players. Sounds like you have been chatting with people who are executing an account centric strategy (driven by sales) and not account based. Just a guess…

    Keep fighting the good fight Joanne. I agree with you that referrals are more important than ever before!!

  2. Trish, your organization is one of the few that takes a wholistic approach to account based revenue and sales. Most have SDRs and BDRs pretty much as lone rangers. We know that doesn’t work. Thanks for taking the time to set the record straight!

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