Managers: Do You Have A Referral-​Selling Environment?

BY Kathy Crosett
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As a sales manager, you are probably laser-​focused on helping your reps make their numbers. It’s easy to get wrapped up in short-​term goals and on CRM data to ensure that reps are constantly engaged in selling conversations. Long-​term goals often include building referral relationships. If you fail to help your reps reach those goals, you may be harming sales in the long run.

Geoffrey James recently channeled some advice from Joanne Black, an expert on referral selling, in his post for Sellingpower​.com. We all know that referrals can open the door to more sales. The statistics about sales which result from referrals are astonishing. Your reps can count on referred prospects to ultimately spend 20% more with you than the average prospect. And, because referrals are coming to your reps through an established relationship, there’s often a shorter sales cycle.

With all this good news, why aren't more managers insisting that their reps work their referral network? The trouble for many sales managers is that referral selling is not a ‘numbers-​based’ activity. Reps must engage their soft skills to strengthen customer loyalty, or they may spend time networking with the goal of eventually scoring a referral-​based sale.

You may have unwittingly established a sales environment that encourages reps to spend time on ‘sales encounters’ only. If that's what is happening in your organization, consider changing your focus. Start by holding a referral-​selling kick-​off meeting. Share the positive aspects of referral-​selling with your reps and ask them to engage in activities designed to attract more referrals:

  • They should regularly make lists of clients, friends, service providers and neighbors who may know of good prospects, and then they should ask for referrals.
  • They should position themselves as experts on a specific topic and engage in outreach – writing blog posts or speaking at meetings – which reinforces that image.
  • They should attend at least one networking event each week.

Once your reps start spending time and reporting on their referral-​selling activity, you’ll all see the positive outcome of this change.