Good Customer Service Alone Does Not Mean Referrals
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Good Customer Service Alone Does Not Mean Referrals

Many businesses are under the impression that if they provide good customer service, people will refer business to them – just like that! However, they only have part of the picture… Yes, customer service is important. But it is a prerequisite – it’s a minimum expectation.

Think about it. Would you refer somebody to me if I provided lousy customer service? Of course not. You’d end up looking silly in the eyes of the prospect and your own credibility would suffer.

Good customer service is part of what the prospect expects when you refer him to me. If you’re recommending me to him, I must be something pretty special, right? And if I want to keep that customer coming back, I’ll need to give him more than the minimum expectation of simply good customer service. I’ll need to provide great, outstanding, memorable customer service to really stand out.

Good customer service alone is not enough to build your business through word-of-mouth referrals. People have gone out of business by just sitting back, and waiting for good word-of-mouth to rescue them.

People refer business to you because it enhances their relationship with the person they are referring. They want the prospect to come back to them and say, “Thanks for sending me to Joe Smith. He had just what I needed, and the service was great. You sure know some outstanding people!”

A good referral is a win-win for everyone

Your referral source has a strong interest in making sure everyone comes out a winner. They know that when the happy customer comes back to you again and again, you’re more likely to send business their way when the
need arises.

To consistently receive referrals, you must be able to network and market yourself and your product/service in such a way that it makes people want to do business with you – and refer you to others. You need to provide them with such a great buying experience that they know they made the right decision.

Plan your word-of-mouth

An effective word-of-mouth marketing plan will focus you on being very specific in what you do and in how your product/service is uniquely valuable. If you use general terms, you’re at the lowest level of competitive effectiveness. And if you say “customer service” and that’s it, that’s not what people are buying.

Talking about what you do does not motivate people as much as what happens to their client or friend as a result of what you do. I never met anybody who was buying good customer service. They were buying the ability to solve their issues quickly and reliably. Customer service is only part of what creates the end result.

Unhappy customers are eleven times more likely to talk about your business than happy customers. Good customer service only reduces negative word-of-mouth; it doesn’t necessarily increase your business through positive word-of-mouth.

Now, it is important to keep this in mind: If you provide outstanding customer service, AND your referral partner has experienced that as a customer, it can definitely increase the number of referrals you receive.

Great customer service to a referral partner can be a jump start to cultivating your referral network.

Use your testimonials

Referral networks and other referral settings often feature third-party testimonials, in which someone who has used your product or service (in this case, your referral partner) tells the group, “I’ve used Joe’s products, and I’m here to tell you, they’re the best I’ve ever found.” Hearing it directly from someone they know is often enough to get people to believe it and act on that belief.

Testimonials are a very important part of the referral process, especially within referral groups. Never underestimate the power of the third-party testimonial. When you stand up and say, “I’ve used this person, and you should use this person too, because…” and then go on to explain why, it makes a huge difference in how people view that service provider.

By Dr. Ivan Misner

Published with permission from the International Institute of Directors and Managers (IIDM) –


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