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Do referrals provide valuable leads or people expecting ‘mates rates’

01 June 2015

Business owners often talk about the value of referrals or word of mouth recommendation. Many even adopt a more proactive approach than just relying on others to spread the word and instead invest time into networking or money into a referral scheme.

It’s a strategy that is widely believed to be a necessity for successful businesses and is largely supported by business textbooks, experts and bloggers. Indeed it’s something that we actively promote to our franchisees at Your Plumber, to not only wait for the referrals that come from providing great service but to adopt a proactive approach towards generating even more business through word of mouth and referral.

But are referrals always as valuable as people think or hope they might be?

There’s a danger that people who enquire about your service through referral do so for the wrong reasons for your business. We hope that people who have been recommended to us or who we have connected with at a networking event do so because they want the reassurance of dealing with a recommended service who they know will do a good job and that they will be prepared to pay for. 

Unfortunately the reality sometimes can be that people you connect with at networking events or who are recommended to you can do so expecting a favour or because they expect ‘mates rates.’ Suddenly referrals can become less of a golden opportunity for more business but a problem that needs to be skilfully negotiated!

How do you prevent referrals from expecting ‘mates rates’?

Peoples’ expectation of you and your service depends largely on what they know about you or have been told. Your brand’s story therefore is critical in determining the quality of leads and referrals that you receive and in shaping peoples’ expectations when they contact you.

Some of our very own franchisees have at times maintained an argument for charging low prices on the grounds that “the customer will be so happy that they will come back for more and tell their friends and family about us.” Sadly, that’s true, they most likely will.

And that’s where low quality referrals come from – when the story that people hear or their expectation of your service is that it’s good and reliable, but also that it’s cheap. If you undervalue your service (see the dangers in our previous blog) or fail to tell your brand story as one that promotes the true value in your service then all you can expect is people expecting the dreaded ‘mates rates’.

High quality referrals come from people who already know, either because they have been told by you or by someone else, that the service you provide is professional and reliable and at a price that comes with such a service.

We ensure that public expectation of the Your Plumber service is precisely what we want it to be – an expectation that you will get what you pay for.

Customers contacting Your Plumber through referral do so with the expectation that they may pay more than they would pay elsewhere if they shopped around for a smaller contractor, but in return that they will get a far superior service that is considerably more convenient, reliable and professional.

If you are ambitious to start your own business and want it to be known for the right reasons, or if you already run a business and are suffering from too many people expecting ‘mates rates’ get in touch with us and see how we can help you to win the customers you really want.

Call 01202 230070 or email us.

Questions? Call 01202 230070
or email YourPlumber here