The Power of the Referral

Posted on | July 1, 2010 | No Comments

Yesterday, the starter went out in my van. Once in a while it would actually turn over, but most of the time it just went “click”.

I did manage to get it started, but had no idea where to take it to get it fixed. I’ve had so few problems with this car that I didn’t have a regular mechanic, and somehow the thought of taking it to the dealer didn’t appeal to me, since a little internet research showed me that dealers are generally more expensive than independent mechanics.

But how to find a good shop in the morass that is auto repair. There are literally hundreds of shops in our town. I Never even thought of the yellow pages, the new version of which arrived on my door the day before. Most of the ads tell you NOTHING, and I actually can’t even remember the last time I looked up a service or product in that anachronistic book. Didn’t even want to try to find on on the internet because who know who you can really trust?

BUT, we’ve been taking my wife’s Honda to a local shop that SPECIALIZES in working on Hondas, and they’ve done a fabulous job for us for the last 4 year or so since we discovered them. But they don’t work on Dodge Caravans, even if I tried putting a Honda hood ornament on it.

So, I piled my dog in the car (totally irrelevant, but I love my Golden Retriever and he goes everywhere with me), and drove to my wifes mechanic. Leaving the van running I walked in the door, and asked who they’d recommend. I wanted someone close, and someone they’d take their cars to if necessary.

They gave me the name of a shop about 6 blocks away. Crosby and I quickly headed over there.

Because of the recommendation from someone I trusted, I never even questioned that this was where I would take my van.

The end result – I now have a new favorite place to take my vehicle. They did a great job, communicated well, did it on time, and gave me a heads up on some other work I was going to need to get done before too long.

That’s the power of referrals. I was pre-sold when I walked in the door. I had trust an confidence because of the referral.

And even more importantly, they took good care of me, understanding that a referral reflect on the referring party as well. Had they not, it might have lessened my trust in the Honda shop.

And that’s why we should be doing as much referral marketing as possible. It works, and it’s cheap. Even if my new shop sent a thank you give to the referring shop, it’s very inexpensive marketing, given the lifetime value of a happy customer. In the next 90 days, I’ll be worth about $1200 to them.

So how’s your referral marketing process? Mine’s pretty sloppy right now, and that’s something we’re fixing. A few years ago we had a much more formal process, but with all the changes, we let it slide, and now it’s time to put it back in place.

I’m right now reading John Jantsch’s book The Referral Engine (see the bookstore in the sidepanel). The first half talks all about the importance of creating a product an service that’s imminently referrable, which is not what I expected, but something I very much needed to read and internalize. I’ll let you know about the second half as I finish it.

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