Why? Because either the seller is calling someone who knows them and is expecting their call, or not.
Cold calling is a sales tactic that has a low conversion rate. A seller might start off with a list of 100 prospective clients, but may only receive any sort of response from 20 people. Of that smaller number, only a handful will become buyers.
Instead of cold calling, Joanne advocates that sellers focus on getting referrals.
Referred clients are a seller’s dream. The seller knows going in that there is a need for their products and services, so part of the selling is done already. Since the seller was referred by someone the client knows, the sales process is much more personal and a lot of trust is already there.
In fact, when sellers are referred, they get a new client more than 50% of the time.
A big part of this is that people don’t have time anymore, so they’re more willing to talk to sellers who have been referred than some random person.
Unfortunately, Joanne pointed out that most sellers have a hard time asking for referrals for five reasons.
- There’s no strategic initiative to ask for referrals. As a result, most sellers are busy with a lot of activities that don’t lead to referrals.
- Referrals have not been part of the sales process. No one is used to asking for them.
- There haven’t been metrics around referrals. No one knows why sellers should focus on referrals. They don’t track how many referral meetings happen each week, how many clients give referrals, or the time it takes to make a sale to referred prospects versus how long it takes to sell to a non-referred prospect.
- Referrals are a skill. Sellers don’t know how to ask, so they don’t do it.
- There’s a risk of personal discomfort. Sellers don’t want to be rejected, so they don’t ask.
Joanne reassured attendees that asking for referrals is not as uncomfortable as most people fear it to be.
After all, she pointed out; most of the attendees at the conference have happily recommended people or products themselves. When someone they knew, liked and trusted asked for a referral, most attendees at the conference were probably happy to help.
She also talked about how most people are happy to give referrals because they’re helping the person they’re referring the seller to. They’re saving that person time in looking for a solution to their problem, they’re giving that person a valuable resource, and elevating their own perception with that person because they’re becoming a resource as well.
Joanne concluded her session with a challenge. She told attendees to make a list of 100 people, with the ones they knew best on the top. Then, attendees were to start from the beginning and ask those people for referrals. She promised attendees that they would be pleasantly surprised at the great results.
For more info on Joanne and her referral strategies, visit her No More Cold Calling website.