If I told you there was a sales strategy that could multiply every closed deal into three more, enable you to enter every sales conversation with built-in trust and interest, and significantly increase your close rate, would you be interested?
Yeah, I thought so.
The secret is out: This strategy is real, and it's called referral selling.
But in our time on the HubSpot Sales Blog, we've noticed a strange and frankly disheartening trend. Posts about referral selling -- how to ask for a referral, how to mine your existing network, how to build a referral program -- don't perform well. But posts about proactive outreach perform through the roof.
Why is that? Proactive outreach is harder and more time-consuming than referral sales. It requires more average upfront research to find one good fit prospect, and there's no guarantee that you'll ever connect with them.
Referral selling, on the other hand, is the very definition of warm outreach. By asking your happy customers which of their acquaintances are a good fit for your product and might be in the market for a new solution, you're achieving two things:
- You’re being referred by a trusted mutual source. As a result, the new prospect is more likely to want to speak with you -- you've clearly passed their acquaintance’s litmus test, so you're viewed as more reliable and trustworthy.
- You're asking your acquaintances to do some light qualification work for you. Instead of taking a shot in the dark, you're focusing on prospects who have been identified by your own customers as likely to want and see success with your product.
Think of referral selling this way. Most sales processes follow a linear path. Starting with proactive outreach starts you on square zero. Starting with inbound leads brings you up to square one or two. But referral selling? You're already at square five.
If you're ignoring referral sales or haven't made it a regular part of your selling routine, you are missing a huge untapped source of leads. We're in the Information Age and all empowered to find the answers to whatever questions we might have on our own, but the sheer volume of information out there means that often it's just easier to ask the people we trust.
In fact, HubSpot CEO Brian Halligan sat down with some of our department heads to find out how they make decisions, and they unanimously replied that they most trusted their professional network to make recommendations of products they’ve used with success.
And that’s where referral selling comes in. If you can tap into these networks of trusted acquaintances, you can enter your deals with one foot already in the door, jump to the top of prospects’ vendor lists, and speak with prospects who are already looking for a solution.