Sales responsibility starts at the top.
Ernest, CEO of a CRM company, had sales all figured out … or so he thought.
He’d implemented a “perfect” sales process, which he explained to me in detail. He even drew a chart with circles and arrows for each step. Ernest recognized he had a problem: He lacked a plan for consistent follow-up with current clients. However, he was too focused on building out the bells and whistles on his software to worry about follow-up.
After he finished outlining his sales process, he sat back and said: “That’s perfect. There’s nothing missing.”
What About a Referral Program?
Of course, there was something missing. Actually, more than one thing. The company has exceptional clients. But there was no referral program in place, so no one was asking for referrals.
Except for Ernest. He told me about how he called a former client and asked for an introduction to exactly the person he wanted to meet at a specific financial institution. His colleague made the introduction, and the prospect became a client in practically no time. Ernest bragged about how quickly the sale was made, the instant credibility he had, and the absence of competition.
Ernest understood that asking for referrals is the way to build a cadre of great clients, but he didn’t have a clue why his reps weren’t asking. He had what I call “point and tell” syndrome.
You can’t just tell your sales reps to go get referrals. Asking for referrals is a behavior shift. It’s a skill that must be built, practiced, measured, reinforced, and coached. It’s simple, but it’s not easy.
Which leads to the next question …
Should CEOs Lead Referral Programs?
Many CEOs turn over the responsibility for sales to their sales leaders, and then shift their focus to company strategy, growth, and profit forecasts.
The problem: CEOs are ultimately responsible for top-line and bottom-line growth, which means they are also responsible for sales. They must adopt a referral program as a company strategy, turn over the day-to-day tasks to sales leaders, and then tap into their networks for referral introductions.
If CEOs want predictable revenue, they can’t abdicate their responsibility for sales. They must model the referral process and drive referral selling as a strategic initiative that includes goals, metrics, and accountability for results. They must ensure sales leaders have a disciplined referral sales process in place, and that sales reps have the skills and coaching they need to blow past their numbers.
Otherwise, CEOs are just pointing and telling, and that simply doesn’t work.
Referral Selling: How to Get It Right
A disciplined referral program guarantees that only qualified leads make it into the pipeline. Referred prospects consider us experts, value our time and ideas, and actually want to hear from us—which is why they convert into customers more than 50 percent of the time. Referral selling is a scalable and predictable prospecting strategy. But 95 percent of companies don’t have a well-developed referral sales process.
Here’s what it takes:
- A written referral sales plan
- Written weekly referral sales goals—for individuals and for the team
- Metrics to track and measure referrals
- Referral skills and coaching
- Accountability for results
- A system in place to reward employees for generating referrals
When companies implement referral programs, their competitors are toast. Salespeople get in early with the right prospects, develop relationships, clarify needs, and set the standard by which others are evaluated. In most cases, the competition never even gets a meeting.
Ernest knew that. He even admitted it to me. But he failed to make sure his sales team knew it, too, or that they were taking steps to nurture those important relationships.
Don’t let your sales team make the same mistake. The worst thing salespeople can do is waste a perfectly good relationship—i.e., a referral opportunity.
Join the conversation: Does your company have a similar challenge? Share your stories and suggestions below.
Is your team ready for referral selling success? Take the Referral Selling I.Q. Quiz to find out. It’s 14 “Yes/No” questions and completely anonymous. It should take you just a few minutes to complete, and you can see the cumulative responses immediately. Email email@example.com if you would like a dedicated quiz for your sales team.