Referral Plan
May 11, 2017
Referral Plan (P3)
May 18, 2017

Referral Plan (P2)

<<Part Two>>

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​In Part One of this three-part series we looked at (1) why you would want a Referral Plan that connects you with like-minded professionals who sell to customers similar to yours, (2) the advantages of having a network of Referral Partners, and (3) how a prospect that comes to you via a referral is more qualified than someone who comes to you through any other form of advertising. You and Kitchen Design Partner (KDP) created plans and strategies for a successful referral program, and you profiled your ideal customer.

Now let’s look at the actual workings of the Program, what’s involved, what you need to know and how you can make it work for you.

You And Your Referral Partner Need to Know
​and Understand Each Other’s Business

​We’ve said it before: you and your Referral Partner should have similar types of customers in common. You should also know how your Referral Partners conduct business, and they should know the same about you.
Sales Cycle. How long does it typically take for a prospect to move through the sales funnel and reach a buying decision? Remember?
KNOW
LIKE
TRUST
TRY
BUY
REPEAT
REFER 
Deliverables. Discuss what your customers get when they hire you.
Details. Make sure anyone you do business with understands how your time is allocated during a renovation/remodel project.
New Client Intake Process. Do you make initial contact by phone? Do you prefer to have your Referral Partner set up the introduction?
Marketing Activities. How will you promote your Referral Partner? Think “Before and After” Case Studies, Houzz, social media posts–all places where you can give credit to your Referral Partner. Make sure it’s reciprocal.
Contingencies and Problems. It’s best to discuss in advance how you will deal with a difficult referral customer you might want to cut ties with or any other difficulties that will inevitably arise.
Fine Print.  Hammer out terms and conditions connected to referral fees.

Building Trust

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​If your Referral Partner doesn’t know you very well, building trust can be a challenge. Help him or her come to know, like and trust you by sharing “Before and After” Case Studies, testimonials and online reviews. Tell them about other referral relationships you have. Look to see if you have any customers in common from before you started the referral relationship. Happy customers are the most powerful proof of your business expertise you can offer.

The more your Referral Partners feel they can trust you, the more business they will send your way.

Work The Program To Get More Referrals

Successful referral programs flow both ways. Give first, and you’re more likely to get. The best way to start getting referrals is to start sending some.
After you share the profile of your ideal customer with your new Referral Partner, get to know your Referral Partner’s ideal customer, too. You expect him to know yours; turnabout is fair play.
If the situation occurs where you’re doing all the referring and/or not getting referral fees, you’re not benefitting from the relationship. Time to make a change! Don’t invest any more time, effort and energy. Find someone new who is tuned into the program.

Communication Says It All

​Communication snafus will de-rail your Referral Program faster than any other challenge. ​ Always be as clear as possible
What you meant to say.
What you actually said.
What they heard.
What they thought you meant.

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Best practices say you should agree to touch base regularly; once a month is ideal. Don’t hesitate to pick up the phone. Every minute you spend talking with a Referral Partner will be beneficial. Every communication, whether face to face, on the phone, or via e-mail builds trust.

Brief e-mails like these are perfect.
“I wanted to let you know that your customer and I were able to touch base and set up a
discovery call.”
“The discovery call is done and your customer plans to make a decision by the end of the
month.”
“Great news! The customer is signing with me – I will keep you posted.”
​Stay in touch and build the relationship; don’t be “out of sight, out of mind.”

Referral Fees

How you want to handle referral fees should be discussed at the beginning of the relationship. By having this conversation when you start to explore the possibility of forming an alliance, you help to avoid any unpleasantness down the road. And what causes more unpleasantness than money?

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Referral rewards should be generous enough to encourage referrals. The more money involved in the transaction, the bigger the reward should be. Your reward program can be as simple as a certain dollar amount paid for a certain dollar amount sold.
Some referral programs acknowledge the referral at two points: (1) when the referral is received and (2) when the referral closes.
Send a reward when you receive the referral so that even if the referral doesn’t result in a sale, the referral is acknowledged and rewarded. One suggestion is to send some expensive chocolates, together with a hand-written note saying thanks.
​The cash fee is paid when the sale closes.
If your Referral Partner doesn’t want cash for some reason, don’t be cheap! If you send a gift rather than cash, it should be appropriate for the cost of the closed sale. Possible suggestions: concert tickets, movie tickets, gift certificates to restaurants, a bottle of liquor or wine for those who drink, steaks from Omaha or other online purveyor. Think of something you would like to receive — that’s what you should send.

Words of Wisdom

There’s no better way to encourage your partners to send more referrals to you than to reward them for the ones they sent.

Conclusions

Your Referral Program will only flourish and thrive if you work it, and this means taking care of your Referral Partners: from nurturing them through the discovery and launch of the partnership on through reinforcing their confidence in you by taking excellent care of your new customers who are referred to you.
Remember the WIN for Retail Partner-WIN for the customer-WIN for you? There it is: your Referral Partner is satisfied, your new customers are happy, and your business continues on a path to growth.
The successful Program will create a cycle that runs on trust: Your Referral Partners are happy because you did what you do, which in turn leads to more opportunities for you to do what you do that then makes them happy.

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Kitchen Design Partner offers a Package that includes REFERRAL PROGRAM MANAGEMENT. Contact us online at www.kitchendesignerpartner.com or call 888-766-8470 to learn how to get your Referral Program up and running.