How do I approach other businesses to offer referral incentives?

[milesquaredesign]

Hi everyone,

I am a designer and I started my business back in 2007 - it has been stagnant for the last few years since I had a couple of kids. I would really like to revive it and get things going again.

One of the things that I have been doing is high end, custom designed wedding invitations and announcements - that sort of thing. I would like to approach other wedding vendors such as bridal shops & event planners, give them postcards that they can hand out to their customers and offer them some kind of commission or something for people they refer to me. So my question is - what is the best way to do this? How do I request a meeting with a store manager & make this kind of offer/request while sounding professional? If I offer a monetary incentive, what kind of percentage would be appropriate? I have never done something like this before so I'm not really sure how to go about doing it, and I don't want to make a fool of myself.

Thanks for your help!

[Freelancier]

I tend to hesitate when it comes to a referral fee arrangement, just because it's often not enough to get that referral to happen and doesn't "stick" as much as having a personal relationship with the other vendors.

[milesquaredesign]

Thanks for your response. Can you recommend a good way of developing a personal relationship with vendors? What kind of approach would I take for example? Thanks.

[vangogh]

I agree with Freelancier about building relationships instead of offering the commission.

You're already doing the work for some people so that should lead to recommendations through word of mouth. That takes time to build, but it does happen. I would think some other vendors, those who work the wedding, will see your work or have a chance to. Just by doing some work you're getting yourself in front of some people.

With getting to know other vendors can you find reasons to be in their shops that aren't about you trying to get to know them. I assume you aren't planning on getting married, but do you know anyone who is. Are you close enough to go shopping with them. If you're in someone's shop you can start a conversation with them about something other than business and steer the conversation toward what you do. Is there another kind of event you're planning? If so talk to a few and in the conversations where you're thinking of hiring them, bring up what you do.

I think it's also ok to just walk in to someone's shop and politely ask if they have someone they point people to for wedding invitations. If they don't hand out a business card. Don't be push, but let them know what you do. If they do have someone you can still hand out a card and say something like "I know you're happy with your current person, but if for some reason they can't do a job think of me as backup." Maybe you can make them an offer for their customers. Some % off if they mention the vendor. True it doesn't save the vendor money, but it could be a way for them to look good in the eyes of their customers. Plus you can tell which vendors are recommending you so you can get to know them better.

Ideally you know someone who can introduce you to the people you want to meet, but there are other ways to meet them and find a way to bring up your business. One thing to always keep in mind is these conversations can't be about you. You have to think about it from the other person's perspective. Why should they choose to recommend you. Your offer of a commission is one possible reason, but there are other reasons.

Just some ideas. Hopefully something in there helps.

[tallen]

milesquaredesign, to get connected with a broad community of other wedding professionals, sign up for a free vendor listing account on WeddingWire.com and join the vendor boards (a forum for discussion like here, but specific to wedding pros). WeddingWire provides a bunch of tools for networking with other vendors.

[RR151]

Most likely all vendors have a relationship with a wedding card designer so getting in the door is going to be difficult. This sounds to me like a cold call process, which is going to have a ton rejection. This is not much fun...

You need an edge or something the vendors have never seen before. Maybe the edge is that your business is all about customer loyalty or you design a series of "Thank You For Your Business" postcards. You design 10 ways to say "Thank You." Do a direct mail: 1) Ask the vendor in a letter when was the last time they said "Thank You" to your wedding clients. Add design 1 way to say thank you, 2) Another message might be: Ask your clients this: What’s one thing we could have done better to improve your experience with us? Continue to add another creative letter and add design 2, 3, 4, 5) rinse and repeat.

This technique begins to warm up the vendor and you don't have to do the nasty cold calling. Next remember you're not in the price game:

You know you really don’t have to play the price game - So to really understand pricing for the same product or service you need to first understand the three stages of value: 1) basic value, 2) expected value and 3) the unanticipated value.

Basic Value is based upon the must have values like if you are in the restaurant business and sell hamburgers you must have the cheese burger with onions on the menu. It is the must have values needed to be in that specific business niche. If you are in the fast food burger business you most likely don’t offer Chinese dishes but you have all the basic value burger food items on the menu.

Expected Value is based upon the values that make your business even with the competition, which means you need the values that all clients grow to expect with all businesses in a specific niche. These are called expected values and are as simple as the fact that your business uses Mastercard and Visa for payment. Your client expects your business to use this value when they pay for your product or service. The cash only business has long passed the expected value practices in today’s business world.

Unanticipated Value is based upon some product value that is a surprise and ahead of the curve. This value answers some kind of specific client problem, headache or answers a question of importance to your client. This is the one that allows you to charge a premium over and above the competition.

You need to offer value that is important to the client and the one the competition does not offer. You need as many of these as you can develop. They are used to make your business better than and above the competition. The unanticipated value avoids you having to devalue your prices for your product or service. With the unanticipated value you don’t need to play the price game to gain customer loyalty.

I forgot to add:

This technique does 2 things,

1) You are helping the Vendor say thank you to their past clients,

2) You are getting your work exposed to the vendor's recent and past clients,

If you can you need to convince the vendor to use these Thanks You cards right after they do a wedding. Saying thank you as soon as possible and often is most important. Your design service can also be used to design their client's first, second etc... Christmas Card.

[huggytree]

i hand out free referrals almost daily.......the drain cleaner i send 2-4 people to a week i DO EXPECT something in return for.....he sends me a couple of jobs a year...which im fine with......my other referrals are more about keeping a customer satisfied and i rarely get referrals in return.....never $$ in return

i DO give out $$ to people who refer me sometimes....it all depends......i consider it their customer, not mine...and they should make something off of it....its my philosophy.... but its not a common one.....i make good $$ and can afford to share $50-$100.......sometimes i give out gift cards to restaurants....sometimes i take them out to a restaurant with my family and their family to reward them.....taken customers on my boat....taken customers to amusement parks

i think its unprofessional to offer rewards.....give them if you want like i do.....but dont offer ahead of time.....if they like YOU and your work they will give them for free(like most of mine are given)

[HooktoWin]

Hi milesquaredesign,

As Freelancier and Vangogh mentioned a cold referral request is tough. Really tough.

Sucks.

So here's how I was able to get an incredible amount of leads/referrals from people I've never met and didn't have a pre-existing relationship with (for free).

Step #1: I find my Complementary Sources (http://www.business.com/sales-and-marketing/how-to-generate-an-unlimited-supply-of-leads/).

Complementary sources give you all the leads you can handle. These are businesses, organizations or people that serve the same customers you do, but in a different way. Every business is surrounded by complementary sources. Identify 5 industries that are complementary to yours.

Let's say a customer wants to buy a house. That transaction is usually filled with people working towards the same goal in different, yet complementary ways. Realtors, mortgage brokers, appraisers, title company, etc. If you're a Realtor, the appraiser, broker and title company are all complementary sources. They have their own supply leads. The vast majority of those leads are being neglected.

That's your in.

Show these complementary sources how they're losing money and you have their attention. Give them a plan to get their money back via these neglected leads - at no cost to them - and you have their attention. Use this "in" to get a meeting.

Step #2: Prepare your angle

Are you going to resurrect all of their old leads and get them to buy? Can you increase average order values or boost customer upsells on current leads? Will you get customers to sign-up for a subscription service each month? Know your approach whatever it is. Whatever your offer, it needs to resonate with your complementary source. If you're unsure about what they want, just ask.

Step #3: Lay out the finer details of your plan.

You're asking for sensitive and proprietary info. They're less likely to give you access if they're unsure about how you'll use it. Show them how you'll approach their list, what your offer will be and the goals you have in mind. The offer you make to their list needs to depend on you in some way. If you're offering a product or service to their list they need to go through you to get it.

Step #4: Contact the people on their list

This is where upfront research really makes a difference. If you know your complementary source well you know about their customer's biggest problems. Build that into your offer when you contact them and you've got their attention.

Step #5: Add the interested prospects to your list

The people that belong on their list belong in yours. Put them into a follow up system. Start with a pitch and alternate between helpful content, tools or resources and a sales pitch. The list you've built with your source should focus on one thing. Nurturing these new relationships. Provide valuable support to the people on this list. Sell these people on you and your source only when it's appropriate.

If you've identified 5 industries that are complimentary to yours, you should have a large supply of prospects to choose from. I've used this myself in multiple industries and I've don't this with many of our clients.

[checkmate]

Relationship building is definitely the way to go. I have found that free food is a great way to build relationships.

I would go to some local industry events and meet a few people face to face. Don't go to just collect business cards, but actually have some longer conversations with people. Once you have established some rapport, get their card and send them a quick note in the next day or 2.

Tell them it was great to meet them and that you would love to take them to lunch. This will give you some good face time where you will have their full attention. Focus the conversation on them, learn about their business and 90% of people will then naturally reciprocate and ask you about yours. Make sure you don't just talk business though, build a personal relationships as well.

[0maha]

Hi everyone,

I am a designer and I started my business back in 2007 - it has been stagnant for the last few years since I had a couple of kids. I would really like to revive it and get things going again.

One of the things that I have been doing is high end, custom designed wedding invitations and announcements - that sort of thing. I would like to approach other wedding vendors such as bridal shops & event planners, give them postcards that they can hand out to their customers and offer them some kind of commission or something for people they refer to me. So my question is - what is the best way to do this? How do I request a meeting with a store manager & make this kind of offer/request while sounding professional? If I offer a monetary incentive, what kind of percentage would be appropriate? I have never done something like this before so I'm not really sure how to go about doing it, and I don't want to make a fool of myself.

Thanks for your help!

Legendary poker player Doyle Brunson has a great saying: "If you want to get action, you have to give action."

I think that applies here.

Most people think in terms of "how can I get referrals". I suggest you think in terms of "how can I give referrals". Your objective is to build a reputation as a great person to know.

In your current example, if you are looking to connect with people who have storefront locations, just walk in the door. Ask for the manager and make your pitch. The main thing I would recommend is to be just as honest with them regarding your situation as you were here. "I'm just starting out and looking to build relationships with people such as yourself. How can I help you be successful?" In general, people hate being sold to, but they love being asked for help. So ask them. Don't worry about "making a fool of yourself". Embrace it.

All this will take time. You'll probably have to meet with someone three or four times before they really start opening up. But don't be discouraged and don't be afraid to be persistent.

One other thought: In today's electronic-communication world, sending a proper, hand-written thank-you note is an incredibly powerful tool. Since high-end stationary is your business, this is a natural. Make you put a thank you note in the mail that day to every person you meet.

Good luck with your business!

[jaijai]

I've never known anyone with a business who offered monetary compensation for referrals. Most people I know just go into the shop and ask if they can leave their card(s) there for customers to take if they want. Since you have an agenda, building a personal relationship with these vendors will probably come off as forced and awkward. I'd recommend being transparent from the beginning. Call or meet with them, offer to buy them coffee so you can both meet and talk about your products. You talk to them about what you do, they tell you about their business, you're interested because it's in your line of work and vice versa, share your stories, and voila. You've broken the ice and built a relationship with them. Also, offering a referral for referrals wouldn't be a bad idea. Maybe offering to put a link to their website on yours.

[RR151]

If you want to really work with a perspective business. You need to remember 1) that these business owners are very busy people and 2) at every turn someone new (like you) wants just 5 minutes of their time to offer some great deal. Think about this: If they took 5 minutes to listen to every offer they wouldn't have any time to run their business.

I was taught this technique that can be easily tested. The success or failure is not related to the technique it is determined by your proposal so do split testing with different proposals. This technique is designed to get the business owner to read your proposal, that's it. And maybe it "Price Conditions" the owner to exactly what your time is worth, which is $300.00 per hour or 5 bucks a minute.

Okay here is the first paragraph of your direct mail letter with your proposal following below.

Dear Business Owner's Name, (It is very important to get the correct spelling of their name. Don't screw this up.)

I would like to buy one minute of your time for $5.00. I respect the fact that your time is a very important asset that you can’t get back if it’s wasted. I also know you have no idea who I am or what I can do to help market your company but please invest just one minute of your time to read my proposal. See the $5.00 attached to this letter.

Then you write a short description of your proposal here...remember you bought 1 minute so don't write a novel.

Wrap it up with maybe something like this,

If you see value in processes that measures the success of your advertising spending then this no cost proposal is something you should try. We hate to waste your time or ours so the entire set up process is done via email. To start the process, contact me at marketing@yourdomain.com and ask to set up "the no cost fact finding exercise".

Your name,

"the no cost fact finding exercise" identifies which proposal was sent to which biz owner.

Just a thought,

[RR151]

One of the things that I have been doing is high end, custom designed wedding invitations and announcements - that sort of thing. I would like to approach other wedding vendors such as bridal shops & event planners, give them postcards that they can hand out to their customers...

Milesquaredesign:

You're in the driver's seat with a talent to create custom high end design content. I mentioned before about creating custom content for the business owner. Things like Thank-You-For-Your-Business Cards. Your there to help them with Relationship Marketing not to pay them to hand out your cards...I have found an article that explains in more detail and it explains what this strategy is all about.

Plus in the end your relationship with the business owner puts you in a position of authority with regards to creating custom wedding invitations and announcements. If done right the business owner will pay a premium for your custom card design content.

Anyway, here it is...

Relationship Marketing Versus Selling

Many business owners are a little confused when it comes to relationship marketing and selling. Are they the same thing or two different items altogether? Let’s take a look at this in more detail.

Relationship marketing is all about developing a good line of communication with your customers. It is basically a situation where you both win. You are at a point where you trust each other. This can really help when it comes to asking for a sale.

For example, who do you normally buy from? The person you know, like and trust or the person who has the cheapest price? Most people prefer to pay a little extra to buy from the person they trust the most. You probably do the same.

As a business owner the more solid relationships you develop with your customers, the more business and referrals you will see. Do you know that research has shown that it is more expensive to keep on finding new customers, as opposed to retaining current ones?

This is why relationship marketing is so important for any business owner.

It makes sense to work on keeping your customers happy. Then when you run a sale or have a new product coming out, you have eager buyers waiting to snap up your offer.

When you are selling your main goal is exactly that – to get the sale. It may not even matter to you how you achieve this. Your main concern is not that of your potential customer, it is just seeing how much cash you will rake in each day.

While this may bring you immediate success and profits. It will not help you retain your customers. You may not even have happy customers either. By focusing only on the sale and not how you get it, you can be seen as a greedy business owner. Someone who is out only for themselves and not for the good of the customer. We are sure this is not how you want to be viewed?

As you can see there is a lot more work and effort needed when it comes to building customer relationships. This is something that can easily double or triple your bottom line when done correctly.

The best way to look at relationship marketing versus selling is to think of it as retaining current customers instead of always looking for new ones.

Which would you prefer to work on each day in your business?

[HooktoWin]

RR151, this is a fantastic idea. Thanks for sharing it! :)

[RR151]

Thanks for the inspiration, Andrew

I really think the process of "Relationship Marketing" is the ticket to success in the above situation.

I don't see much feedback in this thread but hopefully it's being read.

Milesquaredesign here is one last comment, which is a quote from Thomas A. Edison: I have not failed. I've just found 10,000 ways that won't work.

Don't give up and I wish you all the best,

RR...

[Cheap Freight Pros]

Have you looked into referral networking groups? Some are member run and others are facilitated and a great way to connect with other local business's.