In my continuous quest to improve my knowledge, I have started to read The Referal Engine: Teaching Your Business to Market Itself from John Jantsch. I must say it is a very good book; I have not finished yet (when writing this article, I have just finished chapter 5). I want to share you some new knowledge about the new marketing.
Jantsch defines what he calls a Referral System Process; he defines some basic steps I am going to put here. As a marketer, he does not show an explicit knowledge of what it is a Management System (aka ISO), but in an implicit way, he recommends the PDCA life cycle of Edwards Deming. I hope, after finishing this book, be able to upload a clear Referal Management System guidelines based on his book.
Simple steps are:
- Define your ideal customer and your core message. (I will write later on this as this worths a single article. For now, I'm going to put something little)
- Find a remarkable difference; find what are you doing different, something that your current customers can not help talking about it. Sometimes this is unexpectable.
Not every prospect is an ideal fit for your business. There are cases that it is better to say no rather than yes. By acknowledging whom you don't want to attract as a customer, you open greater opportunities for customer growth by way of referral.
Usually, your ideal customer definition is already in one of your current customers. Look for someone who fits in something like if we have more like him, we are going to be happy. Later I will describe in another article how to do this. For now, the task is to look for an ideal one within your current ones.
Create an Innovation
This is your remarkable difference. Sometimes, it is hard to find. Jantsch gives us the following guidelines to find ours depending your business nature:
- The owner is the customer. In other words, dog-food. A term that it is commonly used in IT to say that uses your own products.
- The market already understands the offer. Look for ideas from people that are experts in other areas. They will give you different points of views.
- The market already spends money here. You don't need to go into the non-ending battle trying to explain an unknown need. The need is already recognized and people are paying for it.
- It's an innovation that simplifies something. You must find a way, a new way, to differentiate from others and make life easier. Something that market easily understands and appreciates.
- Nothing is precious. Keep talking to your customers, and other parties. Any feedback of your product or service will help you to improve.
Networks in your System
The Customer Network
Jantsch defines two types of Customers:
- Customer base or "direct network"
- Companies that serve the same ideal customer. The book does not specify if those companies offer the same service or product, or they only target the same kind of customer.
The big objective here is to find customers that are willing to qualify as a volunteer force sale.
The Strategic Partner Network
Look for a partner who has the ability to introduce you to hundreds or thousands of prospect in a given time. The book does not state any kind of reward for partners, but this sounds more like everybody shares prospects at once.
Fulfilling the promise
Here it is where I can identify the Deming's Cycle. If you are familiar with ISO 20000, ISO 27000, ISO 9000 or any other, you will find somehow a similitude.
Get an expectation mindset
First, you need to be 100% positive you are worthy of referrals. You need to create your strategy and transmit the idea. Your planning must contain a step of referral generation in the lead-conversion.
Jantsch suggests you have something like this in your speech: We know you are going to be so satisfied with what we've agreed upon today that after the project is completed, we are going to schedule a meeting to make certain you received the results promised, and at that time we'll ask you if you would introduce us to three others that you know need these same results.
Segment customers from partners
Customers and partners are very different, because of this, you will need a totally different approach of each kind. For customers, the likely motivation is that they love what you do that they want to refer you. Partners are totally different, it is all about business; partners' motivation is more to add value to their current customers.
Create turnkey tools
By definition, a turnkey is something you can sell as a finished, whole product that anyone can get. Strictly speaking, a turnkey does not need customizations or customer does not need to finish it. But in this case, the author is talking more about giving coupons, white papers, blog, packages with partners and any kind of tool that help your prospect to understand the added value of your product or service.
More than one creative entry point
Look on many kinds of customers: the hyper-loyal, the casual one or the non-profit. You should have something ready for each one.
Measure and Adjust
Create a dashboard with key metrics. This way you can know if your goals are done, and if you are having success. The author does not explain yet how to do this, but in my personal experience with management systems, there is a phase I want to share: If you can not measure, you can not manage it.
Then, you need to specify some useful metrics for you. Having metrics just for fun it is just wasting time. Jantsch suggests some metrics such as:
- Pages views
- Referred leads
- Closed deals
He doesn't say anything else. But I really suggest to use quantitative metrics, numbers are clearer than qualitative for management tasks. And they are easier to convert to qualitative (red, yellow, green) if you need to show an executive report.
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