The Referral Engine – John Jantsch [Book Summary]

by Nick

We are all inclined to give recommendations, to advise someone. We like it.

This is our natural disposition, which can be successfully used in business. Recommendations can be the main source for attracting new customers.

They are quite capable of replacing advertising.

Moreover, the recommendations allow you to set higher prices for goods and services. John Jantsch talks about what needs to be done to be recommended by your company in his book.

The author explains in detail how to develop an effective system for obtaining recommendations and how to create an affiliate network of recommenders.

This book is available as:

AudiobookeBook | Print

Package to Fiji

In the Canadian company FreshBooks, a service for billing and control over the terms of payment, it is customary to share personal impressions with customers.

Therefore, once the founder of the company Mike McDerment posted a post on the corporate blog dedicated to his fiery love for Triscuit crackers and their new wonderful views.

One client named Jonathan wrote a humorous comment in which he threatened to disconnect from his FreshBooks account “because of such irresponsible posts.”

The fact is that Jonathan was very interested in Triscuit crackers, but at that moment he lived in Fiji, where they were not for sale. In response, FreshBooks employees sent Jonathan several boxes of Triscuit.

After receiving a package that covered almost 13 thousand kilometers, Jonathan immediately posted a laudatory post glorifying FreshBooks on his blog.

“The health and success of most companies can be measured by a simple indicator – the number of customers who recommend them to their friends, neighbors and colleagues.”

When sending crackers, company employees did not pursue the goal of receiving praise. They just wanted to make the customer enjoyable. But the story of this disinterested act quickly spread across the Internet, which served the company well.

For FreshBooks employees, it’s nothing out of the ordinary to provide a customer with a token that travels thousands of kilometers. The company sees its goal as a pleasure for every contact with it.

Such an approach is a win-win strategy for obtaining recommendations, which allows making recommendations one of the driving forces for business development.

The Summary you might like: Made to Stick

Who Does Not Like to Advise!

Getting recommendations for your company is not so difficult. They can appear by themselves because people tend to share their positive experiences with others.

Perhaps this habit arose in primitive times, when the exchange of information about where to find the best places for hunting, allowed our ancestors to survive.

“In a recommendation-based business, trust is the main reason for recommendation.”

If you please customers with an excellent quality of service, they will surely want to do something nice in return. Usually, such a response courtesy is the recommendation.

Moreover, this can happen without stimulating the process on the part of the company. In an informal survey conducted by the author among representatives of small businesses, it turned out that 80% of them do not have an established system for obtaining recommendations.

At the same time, 63% of respondents were convinced that the majority of customers found them precisely on the recommendation. Of course, this is the wrong approach. To advise your company to others, you need to take active steps.

“The motivation for recommendations lies in our deep need for communication.”

How do successful companies achieve an increase in the number of recommendations?

Firstly, they fulfill all their promises and thereby gain the trust of customers. Secondly, they treat employees as warmly as they treat customers.

Thirdly, these companies make great efforts to develop a culture of recommendations – employees are taught to put complete satisfaction of customer needs in the first place.

In other words, instead of “How to sell?” In such companies, they ask: “What can we give the client?” Or: “What is the best service?”.

“The power of the driving force behind the recommendations is so great that it will seem to your brand fans that they just can’t help but sing praises to it.”

Companies with positive reviews do not have to spend large amounts of money on advertising: customers come to them themselves.

Very often, the products or services of these companies are more expensive than competitors, but this does not deter buyers.

Ask and Receive

When you ask us to recommend your company, remind your customers that in doing so they will provide services to their friends, relatives and colleagues. Make it clear that you are not asking customers for help, but giving them the opportunity to be of service.

“Even if the source of recommendations is fully prepared, it should still be motivated and stimulated.”

At what point is it best to ask for a recommendation? When a client praises your products or services on his own initiative, when he sends a letter of thanks, when you managed to help him solve a serious problem.

Feel free to ask for recommendations after the successful completion of the project.

If your company has strategic partners, then remind them of themselves when they join a new professional association or trade association.

Such opportunities are best not to be neglected. Keep in mind: those who want to be recommended should be prepared to recommend others themselves.

“The Life Cycle of an Ideal Customer”

How does a potential customer first become a real customer and then turn into a referral? This process is represented by the “ideal customer life cycle”, which consists of the following steps:

  1. Acquaintance. A potential customer first learns about your company. This is mainly due to advertising, so find a way to stand out from the competition.
  2. Sympathy. A potential client likes the company, but he wants to get more information about it. Try to fully satisfy this need.
  3. The trust. The client begins to trust you. Give him the opportunity to make sure that you can rely on.
  4. Start of interaction. At this stage, the potential customer seeks to make sure that your company is exactly what he needs. Help him with this. Have him test your products or services before you buy.
  5. First purchase. Do not rush to rejoice if you have sold your wonderful product or service. You still need to demonstrate the exceptional quality of service, for example, by delivering the purchase on time.
  6. Repeated purchase. Of course, you can count on it only if the customer has benefited from the first purchase.
  7. Recommendation. Buyers become your free sales agents, that is, they begin to recommend your business to friends. At this point, you should make your business open to its followers. This will help you improve it. For example, you can organize a joint discussion with your regular customers about the problems associated with attracting potential customers.

“Consistent customer support is one of the underrated strategies for successful marketing, which, when applied correctly, will help build a long chain of interconnected recommendations.”

If you act correctly, then, having passed this cycle, customers will turn into sincere adherents of your company.

Key Difference and Perfect Customer

Develop a “comprehensive referral strategy” – a system for attracting new customers on the recommendation. Create a calendar showing when you last visited each customer.

Make sure that this period does not exceed 30 days for the most important potential clients and clients – sources of recommendations. Reward those who bring new customers to you. Give thanks and send gifts.

“Most likely, your employees treat customers the same way you treat your staff.”

Identify the “key discussion difference” of your company or product.

It sets you apart from the rest and gives you a reason to talk about you. If there is no such memorable difference, then you need to create it – then it will be easy and pleasant for people to talk about you.

They just can’t help it. An example of such a successfully found “simple and brilliant” feature is the Cheeseboard Pizza Collective located in Berkeley. It does not work at all like other restaurants. Instead of offering several types of pizza, in it every day they cook only one, but unique.

There are huge queues at the pizzeria daily – an obvious proof of success.

“The companies they are talking about work for the highest goal set by the owner in love with their work or an indifferent team of employees.”

Make a profile of your ideal customer. Not every potential customer really suits you. You still can’t create a service or product that would suit everyone equally.

Therefore, you need to choose a narrow niche. Such a selective approach will significantly increase the number of customers who will come to you according to recommendations. And for those customers who do not match your profile, you can advise contacting partner companies.

4c Concept

Previously, 4Ps were important in marketing: product (product), price (price), place (place), promotion (promotion).

Today, thanks to the Internet, 4C has come to the fore.

  • Content (content) – information that the company provides to existing and potential customers in their blogs, videos, reports, at seminars.
  • Context – the ability to put information “in the context of a customer’s life”, to present the product in such a way as to interest it.
  • Connection – providing potential customers the opportunity to contact the company in the most convenient way at the most convenient time for them.
  • Community – various associations of current and future customers via the Internet-based on common interests.

“It cannot be denied that endorsements in the press influence awareness and trust.”

The main element in 4C is content. All marketing efforts should be based on high-quality content. It can be various educational materials, thematic reviews, practical guides, author’s articles, podcasts, videos …

The main attention should be paid to the “white paper”. It will become a strategic document explaining why your company is worth recommending.

When creating a “white paper” you need to be creative. Start with an eye-catching headline, then convincingly tell how your company can be useful to potential customers. Support your story with recommendations and feedback from existing customers. Be sure to add a call to action and contact information at the end of the white paper.

“Each client’s lifelong value is unlimited, given his ability to make recommendations.”

A corporate blog allows you to combine all 4C. Typically, companies that are able to acquire customers on the recommendation of very popular blogs.

If you can write interesting articles, then you will attract many new visitors to your site. But before you create your own blog, subscribe to blogs dedicated to your industry.

Leave your comments there – perhaps those who read them will be interested in and go to your site. In addition, it will allow you to observe how other bloggers communicate with their readers.

For your blog to be noticed, post new posts at least every other day. Include keywords used by your ideal customers when searching for information on the Internet.

How to Become Worthy of Recommendations

Do you know how many customers recommend your company?

If it is small, you need to find out why. Perhaps there is a serious reason for this. Ask those customers who recommended the company, what prompted them to do this, and those who do not recommend you, why they do not want to do this. Having found out what’s the matter, make changes to your work.

“Companies that have firmly established themselves on social platforms and are actively using traditional methods to attract customers can easily collect a lot of recommendations.”

Do not allow yourself to doubt your company and that it benefits customers. Let new customers know: you are sure that they will be satisfied, and in the future you count on recommendations.

Create a “customer rights bill”, tell us what your customers can count on and who to contact if they have problems. Explain how to maximize the benefits of using your products, list all available guarantees, tell you what to do if customers are unsatisfied with the purchase. Attach a user manual or instructions on how to get started with the “rights bill”.

“A blog is the easiest way to create content that search engines also take into account.”

Tracking how well you manage to meet customer needs will help the “customer success rate” (PMC). It measures the ratio of the utility of a product to a customer and its price.

In other words, it is value divided by price. Try to keep the PMC more than one, constantly remind customers about the results that they get thanks to your product.

Mutually Beneficial Cooperation

Do your best to attract new customers on the recommendation. One way to do this is to create an affiliate network. It will bring together companies that offer complementary services to the same type of ideal customer.

The bottom line is that if you can’t provide any service (your company does not have the appropriate competence), then you recommend your partner who provides such a service.

At the same time, make sure that the goods or services of other companies are really high-quality so that you are not ashamed to advise them to your customers.

In some cases, it even makes sense to join forces with competitors, for example, if a potential customer puts forward too complex conditions that your company cannot fulfill on its own.

“Getting feedback from happy customers is a great way to complement your marketing materials with good content.”

If you indicate what the direct benefit of working with you and other members of the partner network is, then it will be easy to find strategic partners. To make cooperation even more fruitful, ask your affiliate network members how to identify their ideal customer and how best to describe their unique advantages, approach, product, service or value proposition.

A good option for cooperation with strategic partners is to conduct joint seminars. It may also make sense to launch a joint marketing campaign.

Ask your partners for samples of their products.

For example, a designer may agree with a printing house to print new business cards for free for his clients who order development of logos from him.

The cost of business cards is low, but then the designer’s clients may then want to print other branded materials with their new logo in the same printing house.

A common blog, which will become a central element of the marketing efforts of all members of the partner community, can also be useful.

Remember to ensure that all strategic partners recommend each other.

 

Conclusion

  • To recommend to others what we liked ourselves is our natural tendency.
  • Most of the recommendations are collected by those companies that sincerely try to please customers.
  • If a company is recommended all the time, then it does not have to spend large amounts of money on advertising and promotion – new customers come themselves on the advice of friends and acquaintances.
  • Most companies realize the importance of recommendations, but few try to build a system for regularly receiving recommendations.
  • Convince customers that a recommendation is not a favor to you, but a valuable service to their friends.
  • It is best to ask for recommendations at such moments when the client praises your product himself when you manage to solve the complex problem of the client when you successfully completed the project.
  • Do not try to create a product that suits everyone. Better find your ideal customer – the one who will certainly be interested in your offer.
  • Your product or service should have a feature that you will definitely talk about, thanks to which you will be recommended.
  • Attracting attention to your company will help high-quality content.
  • Team up with companies that offer related products and services. They will recommend you to their customers, you will recommend them to yours.

Why You Should Read “The Referral Engine”

  • To find out how to successfully develop your business
  • To effortlessly advertise your services
  • To get exposure among potential clients for free

This book is available as:

AudiobookeBook | Print