The Value of Word-of Mouth Referrals When You Start a Business

The Value of Word-of Mouth Referrals When You Start a Business

Getting traction for your new business is not easy. Whether you are a virtual business, or a brick and mortar shop, people don’t always know you exist unless you spend a lot of time and marketing dollars telling them.

This is where word-of-mouth referrals come in handy, bringing you value.

Word-of-mouth referrals are when people you know tell other people about you and your business. They speak highly of it, and encourage those around them to buy from you.

Why Word-of-Mouth Referrals are Important

When your business is brand new, you most likely don’t have the budget for marketing. WIthout marketing, it’s hard for others to know that you even have a business at all. This is less true for brick and mortar businesses, since foot traffic and car traffic can help spread the word for you, but either way referrals are an essential part of growing your business.

When people give a word-of-mouth referral, they are saying that they trust you and your business, and believe that you provide an excellent service that is worth sharing. These are the most valuable kinds of referrals, because if someone would send their mom to you that is a huge compliment. These referrals tend to trust you, and they are ready to work with you because they know you treat someone they care about well enough that they would refer you.

This can be hard to achieve when you first open your business. You may not have the track record to show you’re credible, but if someone knows your work and vouches for you? Then they become a part of your track record. This is also why it is important to grow your network, and to build relationships with a give to give mindset.

How to Get Word-of-Mouth Referrals

You may be wondering how to go about getting these referrals, especially if you haven’t launched your business yet.

It depends on whether your business is a service based or product based business. If it’s product based, and you make the products, you can give some of your product to your family and friends to try out and recommend them to their friends. If you are selling products that you don’t make, you can let people look at the quality of the products you are selling. If you’re selling high-quality and unique items, they’ll be just excited as you about your launch.

If it’s a service based business, find someone who could use your expertise. Who can you help to build your portfolio, and get a testimonial from? From there, you can also offer low rates to those you know in exchange for referrals, and offer them additional discounts in exchange for each converted referral.

Don’t be Afraid to Ask for Referrals

You might feel uncomfortable asking for referrals from those you know. Maybe they aren’t supportive of your decision to start a business. Or, there’s no one you know who can use the service you’re in business for.

Maybe you feel afraid of the whole thing. That’s ok! Starting a business can be scary. It’s an unpredictable ride, but there are steps you can take to make that ride less bumpy.

Asking for referrals is asking for support from those you love. It’s being business smart, while also inviting those you care about to play a role in your business journey. It’s something to be celebrated, not feared.

You can also ask your friends and family who they know that might need your services, or products and you could ask them to connect you to them.

Deals for Referrals

Let’s say you start a photography business, and want to take family photos. You have an aunt who lives by, so you offer to take pictures of her and your nieces. You tell her after the experience that you will offer discounts for future sessions if she refers other families she knows to get photo sessions with you.

All they’d have to do is mention your aunt’s name, and you would discount her next session. If your aunt loves to get photos taken of her family often, this would be a great deal. She would feel incentivized to get other families to go to you, and in return, you’d be making more money. It’s a win win.

Many companies today have referral links and discounts for referring friends, because they too understand the value of referrals. They know you want to get a discount on their product, and they want more customers. In the end, a successful referral benefits everyone involved.

If you know someone who is excellent at sales, or has a huge network of friends and family, it would be worth considering asking them for word of mouth referrals. You can test out any referral programs or rewards with them, and see how it would be best put into practice. Slowly, you can incorporate more reward programs or incentives if you want to. You don’t have to offer a discount for a referral, or offer rewards in any way. It’s up to you and what you feel is best for your business.

Building a Network to Increase Word of Mouth Referrals

Word-of-mouth referrals can be the key to a successful business launch. It’s a form of marketing that doesn’t require a monetary investment to achieve. It just requires honesty and vulnerability to those you know, so they can see what you’re doing in your business, and be asked to refer others to your business.

You can also join a networking group that is focused on building relationships, and passing referrals. Finding the right group, with the right goals and mindset will empower you to increase your referrals, and share the value of other business professionals in your area

We know that the success of a business lies in many things, but referrals are at the top of the list. You don’t have to do this business journey alone. In fact, it’s best not to.

If you are looking to increase your circle of influence or to increase your word of mouth referrals for your business, learn more about Biz to Biz chapters, and how we help small businesses like you to find community and support to connect, grow, and succeed.

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