Many business owners mistakenly think that their sales cycle will be jumpstarted with cold calls bringing them to leads. Although this strategy is somewhat effective (based on volume of cold calls), a better strategy is to focus your marketing efforts on getting referrals from existing customers. This great post from About.com outlines a seven step approach to getting referrals. Here are a few:

1) Set measurable goals- Decide to grow your referral business by a certain percentage per month, and do everything to hit that target. This way, you’ll know how much more or less you need to do in order to gain a certain number of referrals. For example, in the insurance industry, agents are known to get at least three referrals from each person they talk to.

2) Pick your top twenty- Not all customers are comfortable giving referrals, so it may be more helpful to target those with whom you have the best relationship. Twenty percent of customers may be a good starting point, and feel free to branch out should you feel that your relationships with more customers is getting stronger.

3) Give, Give and Give- Provide customers with the best service possible, and watch the referrals come. Go beyond what you think is necessary, and make sure customers feel special. According to the principle of reciprocity, which states that people want to help after being helped, customers will willingly refer you to others.

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