Turn Every Customer Into One More Customer….

A New Client Used A Letter I Wrote 9 Years Ago…
And Referrals Started Pouring In.
Here’s The Letter… And An Explanation Of Why It Works.

Written by Rich Harshaw.

I’d never seen the guy before. I didn’t recognize his name or his company’s name. I wasn’t even sure what the heck he was talking about.

Yet he excitedly walked up to me before a seminar in Denver recently and announced that, thanks to me, he had gotten more referrals in the last three weeks than he had in his previous thirty years.

Who are you, again?

Turns out his name is Mike Liverant, and unbeknownst to me, he was actually already a client of mine. He had signed on with us just a scant four weeks before the seminar, and apparently one of my Senior Consultants had helped him write some letter that was getting him referrals like nobody’s business. He was so excited that he was having a hard time telling the story in an intelligible way. Since the seminar was about to begin, I told him I’d talk to him later.

At the end of the day, he produced the letter. It was printed out on an ink-jet printer and didn’t look particularly “professional.” I started reading the letter, and I instantly recognized the letter. I had written it myself some nine years earlier as part of a referral package that I developed for my clients.

“Where on earth did you get THIS!?!” I asked.

Nick (one of my Senior Consultants) emailed it to me, and I just updated with my details, and it works like a charm.

Here’s the letter:

What a beautiful letter! Let me walk you through what makes it work so well.

First of all, it’s important to understand why most referral-generating efforts don’t work… and to check out my five-step plan for getting them. If you look carefully, you’ll see that this letter is actually just a great way to execute step number four in my process, which is “proactively reward your customers.” Keyword: proactively.

In this case, it’s a gift card to Applebee’s. The principle of reciprocity is powerful; it basically says, “if I do something for you, then you’ll feel obligated to do something for you.” A normal remodeling transaction includes a formal contract to perform X work for Y dollars. There’s no reciprocity, per se, because both parties have a formal agreement. But when you add something, unexpectedly, that is outside of the contract—something as little as a $25 Applebee’s gift card—reciprocity kicks in. Assuming the job went well and the client is happy (although, if you do my five steps right they should be MORE than happy), then they will now feel like they’re “on the hook” to do something for you. Like fork over referrals.

Before you get bent out of shape and gripe about the exorbitant cost of the Applebee’s gift cards, consider allocating the cost to COGS for that job. Raise your price by $25 if you have to. Or allocate it to marketing costs. Or just freaking get over it and do something nice for your customer.

Because it WILL come back to you... multiplied.

The letter goes on to explain that the gift card is being sent for two specific reasons: first, to say thank you; second, to thank them IN ADVANCE for “helping them get the word out.” We immediately ask to cash in on that reciprocity by requesting a “letter of recommendation” from the client.

Then check out the ninja moves in this letter. It’s subtle, great stuff: we acknowledge how awkward it is to “hit up friends” for referrals! The letter writer even admits that he, himself, is uncomfortable asking for referrals. Think about how powerful it is to admit that—it solidifies your position as a customer advocate. Not just a greedy business person… a caring, normal HUMAN.

The solution to the awkwardness is then spelled out: if you know anyone who “might be interested” (again, stealthy ninja language), we offer to send them a gift card that the CUSTOMER will get credit for sending. So in other words, the referred person is going to get a GIFT!!

We then offer an undefined “VERY SPECIAL GIFT” if the referred party actually buys. This is good stuff… we’ve already sent them $25 for free—without their having done ANYTHING yet. When we offer something else, they’re going to assume that if you actually come through for them, then you’ll probably give them something worthwhile. This is actually MORE POWERFUL, in my opinion, than saying, “We’ll give you (name something specific here).” It’s the power of intrigue and mystery. It’s showing a little cleavage and leaving it to the imagination instead of taking it all off. Trust me, this is powerful.

Then of course, the P.S., which explains that there’s no obligation to participate in the referral program to use the Applebee’s gift card. But think about that. Imagine the customer sitting there at Applebee’s stuffing their face with Riblets and fries. The bill comes and they whip out the gift card to pay… reciprocity is going to start pulling at them. Pulling hard.

No wonder this letter works! It’s engineered for maximum action!

So it turns out that Mike had tried off and on to get referrals over the years… and when nothing really seemed to work, he just sort of quit trying (sound familiar?). He still got the occasional random referral (blind squirrel finding an acorn), but nothing proactive.

After getting his hands on this letter, he sent it to the first four jobs he completed. Those four letters resulted in four referrals, which resulted in two jobs sold and two more still pending (as of when he told me this story).

Wait a second—that’s a small sample size! I thought this letter was working like crazy!?!?

Read that again—no referrals ever became four referrals out of the first four times he tried it.

Will it work that well for you?

Try it and see.