Incenting Your Referral Sources?

Over the last few weeks, I’ve had a number of conversations with various people regarding referrals and incentives.  I belong to a closed networking group which means that only one person from each professional specialty can participate in the group.  So, in this group, the purpose of our networking is to actually bring referrals to people within the group and help everyone grow their business.  And as a group, we are quite successful with this model and the model itself has been proven throughout the world with Business Network International (BNI) being a world-wide organization.    

referrals, connections
Are you rewarding your referral sources?

Being a member of an organization like BNI already conditions us to think about our network of resources and be on the lookout for people that we can help with our trusted connections.  Every once in a while, we’ll have someone announce they are doing an incentive program for those in our chapter that are able to bring them business.  The incentive is typically cash in the form of a percentage of a resulting sale from a referral.  And you’d think cash would be a good incentive to get people to think more about the business offering the cash incentive.  You’d think, but that’s not the case.  In fact, very rarely have I seen anyone be successful with this kind of program.

Generally speaking, most of us are not motivated by the incentives that might be offered by our colleagues.  And the reason for this is that the incentive doesn’t change our agenda.  We’re out there focused on helping our clients, and friends and family, solve whatever problems or challenges they might be having.  We’re not thinking about what’s in it for us.  And that’s in our nature and simply the way we are wired. 

Rather than announcing an incentive for referrals that lead to sales, I suggest thinking about public ways in which you can recognize those that provide referrals and referrals that lead to sales.  Maybe you publicly recognize someone at an event or a meeting, maybe you acknowledge them on your website or post a special thank you note on Facebook.  Think about sending a hand-written note of thanks for the referral and if the referral turns into closed business, then depending on the value of the sale, you might think about a gift of appreciation. 

What mode of appreciation have you found to be most successful for your referral partners?

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