Myth #12: Great Salespeople are Great Cold-Callers

The movie won the Oscar for Best Picture, but we did not go see it nor will we rent the DVD. However, we did rent and thoroughly enjoy an obscure movie this week, one that is so unknown that Blockbuster carried only one copy.

What makes the difference?

Word of mouth. That's it. It's the most powerful - and often the cheapest - form of advertising. Several of our friends panned the first movie; one of our friends was passionate about the second one. That's how it works. We listen to friends more than critics.

So do our customers!

Word of mouth is occasionally automatic, but it's a more effective tool when it is 1) prompted and 2) prompted properly. Prompted word of mouth advertising creates referrals and referrals negate the need for cold calling.

Here are the basics:

Referrals shorten the sales cycle by eliminating the need for some of the early-stage activities. A great referral can actually move you close to closing on the first call!
If a vendor does a good job for you, will you give them a referral?
When was the last time you gave a referral? Probably it was the last time you were asked to give one! Referrals need to be prompted no matter how well we are performing.

There are two categories and four types of referrals.

Categories:

Internal (your contact refers you to someone in their own organization) and
External (your contact gives you a referral to someone they know in another organization).

Types:

Application: solution-based referrals. You solve a specific problem for your customer and they refer you to others (internally or externally) who are addressing that same issue.
Position: assisting specific professionals. If you can help the CFO in your client's organization resolve some issue, ask them for referrals to other CFO's. You will be positioned with the right person in the other account and you will already know some of their issues. And, of course, they will know that you are familiar with their position because of the referrer.
Supply Chain: earning referrals from your customer's customers and vendors. If you provide a valuable service for your client, wouldn't they want their customers to benefit from it? If you can streamline order entry, accounting functions, etc. wouldn't your customer want their customers and vendors to use your product or service?
Industry: appealing to all of the players in an industry. A common example for this category is compliance: when everyone in an industry is forced to comply with some new regulation, vendors who can assist them will find many opportunities to sell to companies in that category. After making the first sale, leveraging for referrals is a great strategy. Hint: make your first sale to a company that is respected, is an industry leader or who is seen as cutting-edge.

Some of the Rules of Referrals:

Make sure your customer knows what you want (face-to-face call, demo, etc.).
Make sure they're connecting you to the best person.
Provide the words - especially if you're asking them to make the referral via email. Copy-and-paste is easier that composing and you can control the message better.

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