Consumer Insights and Referral Marketing

John Jantsch just had an interesting article on “5 Truths That Lead to More Referrals” (

I’ve done a lot of work in this area and would like to expand on some of Mr. Jantsch’s truths and share some of my own thoughts on the subject.

Referral marketing is the most powerful, effective and cost efficient marketing you can have. This is particularly true for high-priced products and services and high net-worth individuals. To be clear, I’m talking about personal referrals as opposed to providing feedback online to a group of people you don’t know.

I don’t think most people like making referrals unless they are asked for a referral by a friend, then they’re pleased to share their positive experience on a particular product, manufacturer, service or service provider. If asked for a referral, then the person is proud to have been asked and sees it as an opportunity to help their friend by providing information of value.

There are a couple of reasons people are not comfortable making referrals unless asked: 1) they don’t want to seem like they’re a sales person, and 2) referrals are inherently risky. If the product or service being recommended does not live up to the expectations of the buyer, then the referrer’s credibility is questioned. Every time a referral is made, there is an implied endorsement also being made.

As such, if you are the recipient of a referral, I suggest you over-deliver so your new customer, and the referrer are both pleased with the outcome. This also enhances your chances of obtaining additional referrals from both customers.

What also enhances your chances of obtaining referrals is to create “raving fans.” I’m a raving fan of a national quick service restaurant (QSR) chain, a local auto tire and maintenance provider and an online book seller. I have personally brought all three businesses at least 100 new customers because these companies have never let me down. They consistently provide excellent service, good value and are ultimately reliable.

Regardless of your business, if you can provide consistently excellent service, product quality and value for your customers, you can build your business with referral marketing.


About Insights From Analytics

Integrated marketing professional who generates insights from analytics to increase revenue. Daily blog now resides at
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