Three Ways to Cultivate Word-of-Mouth Referrals
Word-of-mouth referrals is one of the most, if not the most, powerful marketing tool to develop. According to a 2016 Nielsen’s Harris Poll online, 82% of Americans say they seek recommendations from friends and family when considering a purchase.
I can attest to this fact because word-of-mouth referrals is also one of my top sources of new private investors for my multifamily syndication business.
Mac Prichard, who is the founder and publisher of Mac’s List, an online community for people looking for rewarding, meaningful work, was able to create and grow a $600,0000 a year business through word-of-mouth referrals. “I started my business as just telling people about job openings,” Mac said. “I didn’t realize how valuable the information was that I was sharing, but the people that I shared it with did, and they shared it with others. That power of word-of-mouth and the relationship that I built as I grew my community has just been a huge part of the success of Mac’s List.”
In our recent conversation, Mac outlined the 3 ways he cultivates word-of-mouth referrals to generate $600,000 a year in revenue.
#1 – Collecting Testimonials
One way Mac generates word-of-mouth referrals is through creating testimonials from his satisfied customers. “We find that collecting testimonials from both employers and job seekers helps promote that word-of-mouth [referral business],” Mac said. “It also adds authenticity to our work because when we do publish testimonials on our website, we ask job seekers to share success stories on our blog, we ask people if we can publish their full name and their photos, and people who read these stories or see these testimonials, they see people who look like them, or are chasing jobs they want, and they can identify.”
Social proof is another powerful method of attracting and retaining customers, so testimonials not only result in word-of-mouth referrals, but has the added benefit of social proof as well. When you are seeking out a new restaurant, for example, not only do you ask friends and family for their thoughts, but you likely use services like Yelp! to see others reviews of the restaurant. Same thing when you are buying a book or product on Amazon. Your real estate services are no different. People will be much more likely to work with you if they can see others who have been successful with you in the past. And creating testimonials is the best way to show the success your service had with past clients.
Mac’s testimonials are simple. He just uses text and photos (click here for an example). However, if you want an extra level of engagement, consider creating video testimonials. Videos create an extra emotional connection that can be much more powerful than what you get with the written word alone.
#2 – Personalized LinkedIn Messages
Whenever Mac meets someone at a networking event, dinner, etc. and has a meaningful conversation (not just shaking hands and saying hello), he will connect with them on LinkedIn. When he sends the invitation, however, he will include a personal note, just a sentence or two, reminding the person how they met and what they discussed.
Sending these personalized LinkedIn requests results in word-of-mouth referrals, Mac said, “because so much of business … is about building relationships and getting to know people, and eventually liking and trusting them, and that’s how deals are made.”
In Mac’s specific business, most jobs get filled by word-of-mouth referrals. “There are estimates out there that up to eight out of ten jobs are never advertised and are filled by conversations between peers,” he said, which is in alignment with the 82% statistic I provided in the beginning of this post.
Mac said, “There’s no conspiracy here. You don’t have to have gone to a fancy school, it’s just human nature. People tend to want to work with people they know, like and trust, or who are recommended to them by people they trust.”
Another advantage of the LinkedIn personalized message is that LinkedIn will save all the message. That way, if you need to reach out to that person in the future, you can go back to the original message and remind yourself where you met them and what you talked about. That added personal touch will go a long way!
#3 – Never Turn Down Meetings
Mac gets approached all the time with people asking him for advice. He has always made it a point to never turn down an opportunity to have a conversation with someone. “If somebody wants to meet with me, even if I don’t know them, I will make the time,” Mac said. “Sometimes it takes a while to get on my calendar, but I will see people, and I do it without any expectation of getting anything in return.”
In doing so, Mac finds that he gets so much back in return. He said, “The relationships and connections that I make through those conversations – and I’ve been doing them for years now – keeps paying dividends for years to follow.”
Mac has the same approach for aspiring competition as well. He said, “I’m often approached by people who say ‘you’ve got a great business here. I think I’d like to do a job board like you’ or ‘I’d like to be a career coach.’ Some people might say ‘gosh, I’m sorry. I don’t have the time to talk to you,’ but for me, my response is always ‘the waters fine, jump right in. Let me share with you what I’ve learned about building this business online.’”
With this approach to speaking with the competition, Mac said two things will happen. “One is if they’re going to be successful – the person I’m meeting with who wants to get into this space – they’re going to specialize. They’re going to find a niche that I’m not serving. The other thing that’s going to happen is they’re going to be a partner and an ally down the road.”
I whole-heartedly embrace this approach. I raise money for apartments, so everyone I meet is a potential investor, either immediately or sometime down the road. Also, I have conversations with other investors all the time on my podcast to add value to my business, but my listener’s businesses as well.
The majority of a business’s new clients come from word-of-mouth referrals. The three main ways to cultivate word of mouth referrals are:
- Collecting and posting testimonials from satisfied customers
- Sending personalized LinkedIn messages to new people you meet
- Never turning down a meeting, if with competitors
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