Referral groups can be a great way to grow your business, but how do you know if your group is working for you? The easy answer is that if you didn’t set goals for what you wanted membership in a referral group to accomplish in the beginning then you won’t ever know. But let’s assume you set a basic goal and your interest in joining a referral group was simply to get more leads.
Why It’s Important to Know if Your Referral Group Is Working
Referral groups require a time commitment and energy. These are some of your most valued commodities as a business professional. You don’t want to waste them so you want to ensure you are receiving a good return on your time investment. If not, there are other referral groups out there.
Here are a few things to look for when assessing your referral group:
1. Are you getting referrals?
This is the most obvious sign that your referral group is working. If you're not getting any referrals, then it's time to reevaluate your group. Make sure you're attending the meetings, participating in the discussions, and following up on referrals you receive. But this is not just a numbers game.
2. Are your referrals quality?
It's important to get referrals that are a good fit for your business. If you're getting referrals that are not interested in your products or services, then your referral group isn't working as effectively as it could be. There’s a disconnect somewhere, either how you’re communicating what it is you do and who your ideal customer is or your referral partner members don’t understand or aren’t communicating it effectively to the people they are referring to you.
If this happens with one referral and one referring member, it’s not a big deal. If it happens consistently with multiple referral partners, you may need to rework your elevator pitch.
3. Are you building relationships with other members of the group?
Networking is a key part of referral groups. If you're not building relationships with other members, then you're missing out on a valuable opportunity to grow your business. Members commit to attending meetings and a specific number of referrals. If they don’t know you well they may simply be referring numbers to meet obligations, not making good matches that they think will turn into business for you.
4. Are you enjoying the group?
If you're not enjoying the group, then you're less likely to be active and engaged. This will hurt your chances of getting referrals. Additionally, ask yourself why you aren’t enjoying it. Are the people vastly different from you? Are there too many conflicts of interest? Do they seem cliquish? If your discontent cannot be remedied by additional efforts to get to know your group, it may be time to move on.
5. Are you tracking results?
Sometimes we make assumptions based on our perception of reality, not reality itself. For this reason, it’s a good idea to use referral tracking software as a member of a referral networking group. With referral tracking, you know how much potential business has been referred to you and the percentage of it that has yielded business. You also can calculate your return on investment by looking at the time you’ve spent in your group versus the business you’ve received from it.
Good data can give you a much clearer indication of whether your group is working for you or not. If not, then it may be time to make some changes.
Tips for Making Your Referral Group Work for You
Here are a few tips for making your referral group work for you:
Be active and engaged.
The more active and engaged you are in the group, the more likely you are to get referrals. Attend the meetings, participate in the discussions, and follow up on referrals.
Make connections with other members.
Networking is a key part of referral groups. Make sure you're building relationships with other members. This will help you get referrals and grow your business.
Be a good referral giver.
If you want to get referrals, you need to be willing to give referrals. While it’s tempting to refer in a high volume so your numbers look good, most business professionals would rather have targeted referrals and hot leads. Don’t give just any referral and assume if your referral member was a good sales person they could convince the referral to buy. Give them what you perceive is a good fit. This will help you build trust with other members of the group.
It takes time to build a successful referral group. Don't expect to get a lot of referrals overnight. Be patient and keep working at it, and you'll eventually see results as part of a well-rounded referral network.