Get More Referral Sales: Tips and Templates to Increase High-Quality Leads

Your existing customer base is one of the most valuable sources of quality sales leads.

Research shows it’s five times cheaper to keep current customers than it is to get new ones.

But since business growth is also dependent on converting new customers, you need low-cost and effective ways to acquire them. The best method is referral sales.

While most people nod in agreement when I say this, very few new businesses effectively make referral sales—and only 30 percent of B2B companies have an official referral sales program in place.

Referral sales can be your number one source of hot new leads and turn into a massive growth engine if you do it right.

What are Referral Sales?

Referral sales involve getting your existing customers to give your sales team the contact information of their peers, usually with the understanding that you will use the existing customer as a referral when you contact the new lead.

In referral sales, you leverage the trust you've built with your customer and the trust your customer has with the new lead to open up a sales conversation. These sales leads typically have a much higher closing rate than those you get through other lead generation methods.

Why are Referral Leads so Valuable?

Referral leads are valuable because they are of higher quality and are easier to close than the leads gathered using other methods.

Simply put, referrals are the most effective form of customer acquisition. Here are just a few reasons for that:

Referral Leads are Highly Qualified

The new leads that your customers pass along are typically in your target customer base—and are seeking software and tools similar to their peers, making them highly qualified leads.

Case in point: 84 percent of B2B sales decision-makers say they make purchasing decisions based on recommendations.

Closing Referral Sales Saves Time

Since referral leads are highly qualified, you save time and resources on the front end of the sales funnel. That’s because you don’t have to spend time collecting, researching, contacting, and qualifying leads—that’s all made easy with a streamlined referral sales strategy.

Referral Sales Generate More Revenue

Sales margins on sales by referred customers are 25 percent higher than sales from non-referred customers, according to a study.

What’s more, the lifetime value of referred customers is 16 percent higher than the lifetime value of customers obtained through other methods.

And remember: Not only do referred customers spend more, but they’re also cheaper to acquire, so your overall ROI is better with referred customers.

Referral Leads are More Trusting

According to a LinkedIn study, trust is the most important factor when potential customers are deciding whether or not to make a purchase. Since you’re being introduced to these new leads through their friends and peers, you benefit from trust from the very start of the relationship.

Transform your lead generation approach with strategic use of LinkedIn.

Bonus Benefit: Referral Sales Programs Help You Track and Reward Loyal Customers

When you reward loyal customers for passing along referrals, you demonstrate how much you value them. This will make them more likely to continue doing business with you and more eager to provide referrals. Learn how to set up your own partner program:

What Most Salespeople Get Wrong with Referral Sales

It can be scary to ask more from a customer after you’ve closed a deal with them. You may worry that asking for more will jeopardize current or future deals. Perhaps you fear a referral request can lead to an awkward interaction. Or, maybe you’re concerned that adding another ask will come across as pushy.

Don’t let these fears get in your way. The worst mistake you can make with sales referrals is to not ask for them at all.

Here are some other common mistakes:

  • Not communicating the referral program effectively. If your customers don’t understand how to provide referrals easily, they aren’t going to provide them. To avoid this mistake, ensure your customers understand what your referral process is and what they get out of providing the referral. For example, if you offer an incentive, advertise and communicate it. Incorporate it into the phone and email scripts we provide later on, or add it to email templates.
  • Not engaging in the ongoing promotion of the referral program. It’s not enough to ask for a referral only once. Instead, make sure your customers have every opportunity to give referrals. If you offer incentives, create evergreen campaigns for ongoing promotion of the referral program.
  • Not communicating and following up with referrals. This seems like an obvious one, but it can be hard to track referrals if you don’t have tools and an official system in place. To avoid this mistake, make sure you have a quality CRM to keep things organized.

7 Tips to Do Referral Sales the Right Way

Ready to get high-quality leads delivered directly into your sales pipeline? Learn the best tips for referral sales:

1. Ask At The Right Time

Asking about a referral works well at several different customer touchpoints. You should approach customers for a referral after positive interactions and when they’ve already seen value from using your product/service.

Sometimes, that’s right after you close a sale or onboard the customer. Here, the customer enjoyed their experience with you enough to buy from you, and you’re fresh on their mind.

To do this effectively, make it easy for your customer to give you the referral. For example, include a link or form where customers enter a referral’s contact information. Set this up so the information automatically feeds into your CRM with a referral lead source tag. (Explore the world of B2B CRMs and their role in optimizing sales funnels in our dedicated article, complete with expert advice.)

It may make more sense to ask for referrals in situations where your customers have received value from you or when they take an action that shows they got value from your business.

If you have any kind of tracking that measures your customer’s success in relation to your product/service, reach out when you notice a customer performing well—and ask them for referrals.

You can also monitor social media and other review sites for positive feedback, which is usually given directly after a positive experience with your company.

Another way to gauge customer satisfaction is to periodically send out customer check-ins and surveys and ask for referrals from those who respond positively.

2. Find the Right Advocate

You only want to ask happy customers to provide referrals.

The good news is that you can easily identify them using some of the methods we already suggested.

  • Monitor your social media and other popular review sites in your niche. When you see a positive review, you’ve found a happy customer!
  • Use customer satisfaction surveys to identify referral sources based on who ranks their experience positively.

Tips to Do Referral Sales the Right Way

Ask your social media manager to monitor your social accounts and send out information about your referral process when they see positive feedback and engagement.

Also, have someone on your team keep an eye on popular review sites and have a process in place for responding to comments and informing happy customers about your referral program.

To create a customer satisfaction survey, I suggest working with the marketing or customer service teams to create a customer survey that you send out at specific touchpoints or at a particular time cadence (quarterly, for example).

Reach out to the customers who provide positive responses and ask for referrals.

3. Use a Referral Request Script and Email Template

If you ask for a referral by phone, you must have a script ready.

We suggest something like this (modify as needed, based on your business and referral program):

You: Are you happy with your decision to purchase?

Customer: Yes.

You: Great! Do you know anyone else who could benefit from [our business/solution]?

Customer: Hmm...I’m going to have to think about this and get back to you later.

You: Totally understand. But is there even one person you can think of right now who might find [our business/product] useful?

(Optional, depending on your process:) We do offer [add chosen incentive] to our customers who make referrals.

If your customer gives you a referral, say something like this:

“Great, thank you! I want to make it as easy as possible for you to make that introduction, so I’ll send you a template you can use to contact [referral]. Just copy and paste it and send it to [referral]. Feel free to make edits or write something yourself if you prefer. Let's make this happen today!”

Then, send them this template to use:

Hey [first name],

I wanted to connect you with [add your name]. Their company does [insert what business does]. I thought you’d find them interesting and wanted to make the intro.

I’ll let you guys take it from here,

[Your name]

If your customer doesn’t provide a referral on the phone call and asks for more time to think, say something like:

“Okay, I get that! I will follow up in an email, I really appreciate that you’re offering your help. We’ll make it worth your time!”

Now, prepare a template for the follow-up. Here’s an example that sales reps can send:

Hey [first name],

I wanted to follow up on our conversation about referrals. If you’ve thought of anyone who might benefit from a conversation with our sales team, please let me know.

To make it easy, you can [explain your process for getting lead information from your customers, like via email or a form].

Or, you can send the following email. Just copy and paste, and send it to any referrals that come to mind.

Here, you’ll want to include an email template like this:

“Hey [first name],

I wanted to connect you with [add your name]. Their company does [insert what business does]. I thought you’d find them interesting and wanted to make the intro.

I’ll let you guys take it from here,

[Your name]”

It’s important to make scripts and templates a regular part of your customer referral program. This doesn’t just save time—it also gives you the chance to test different language and program features to optimize your process continually.

4. Make Referrals Part of Every Deal

Once you've seen success with referral sales, you should make it a natural part of the purchase experience.

After the initial meetings have gone well, and everything looks like the prospect is going to buy, say something like this:

You: It seems like we're a great fit. I'm excited. Before we go any further exploring this potential deal, I want to emphasize that our team is fully focused on building world-class technology and supporting our customers to continued success. That’s where our resources are going. Because of this, we're not investing in marketing and sales as heavily as our competitors, and are relying on our happy customers to refer us to others who might benefit from our product. Does that make sense?

Prospect: Absolutely.

(I've never heard someone say, "No, I want you to spend less time on product and service and do more marketing and sales so I don't have to refer you to anyone.")

You: Great! With that in mind, is there anyone you know who might benefit from doing business with us?

You can also add referral prompts to your email marketing campaigns and drip campaigns.

5. Ask for an Intro, Not a Sale

Sometimes, it makes sense to ask only for an introduction to a new prospect rather than pushing for a sale. This is especially true if you are trying to build brand awareness and engagement rather than just promoting your product/services.

You may also want to just ask for soft intros if you notice that your customers are hesitant to provide referrals at a particular stage in your sales cycle or outreach campaigns. If that’s the case, you can update the referral request at that particular stage to include softer language.

For example, explain to your existing customers that you are always looking to connect with and learn more about folks who could benefit from your business.

Ask for an Intro, Not a Sale

Make the soft referral attractive to the existing customer, too. Come up with a few ways to provide value for them, like giving them insights into industry trends or their competitors based on your company’s research.

Don’t forget to create an intro email template for soft intros! Include links to your newsletter or blog, landing pages for your popular offerings, or positive customer reviews and testimonials. Even with soft intros, giving your customers an easy way to provide referrals is important.

6. Close the Feedback Loop = Get More Referrals

When you close a deal with a referral, ask them this: “Who is actually responsible for all the benefits you’re getting from using our product/service?”

You’ll probably get a response like: “Umm…who? You”

And then you say: “No, the person who introduced us…”

“Oh, yeah, Bob!”

Here's what you tell them: “Do you mind doing me a favor and sending Bob a quick thank you email, so he knows that you appreciate it?”

When they send Bob the thank you email, you're closing the feedback loop. This in turn inspires Bob to make more referrals. The first thing Bob thinks when he gets that email is: “Amazing, they found my recommendation valuable. Who else do I know?”

Everybody wants to make successful connections and help others discover something valuable. You'll see more new, high-quality leads if you give referral sales and word-of-mouth marketing more attention.

7. Offer Referral Incentives

In some situations, an incentive that encourages customers to make hard-sell referral requests might be useful.

This could be anything from discounts or free subscription upgrades to smaller offerings like gift cards and swag (water bottles, apparel, etc.).

You should also consider whether an affiliate program makes sense for your business.

If you use a referral incentive, include it in all your messaging with existing customers.

For an awesome example, look at this case study on PayPal’s referral marketing program. At one point, they were experiencing 7-10 percent daily growth! Talk about a successful referral marketing strategy!

Save Time and Increase Revenue with Referral Sales

I've taught this system to hundreds of founders and thousands of sales professionals, and many have successfully implemented it. But I have to warn you—it takes conviction and serious grit to keep asking for referrals even when people say no.

If you have a great product and offer attentive customer support, you have what it takes to build a successful referral sales program.

Just follow my advice: Set up an official sales referral program complete with scripts, templates, and evergreen campaigns. An effective referral pipeline is worth the effort—studies and surveys repeatedly show that referral leads are the most lucrative.

Follow these steps, and you'll start a growth engine for your company that will support scaling sales for many, many years to come.

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