How Referral Networking Grows a Small Business
Why referrals are the most trusted way for a small business to grow, and how a referral networking group turns a few relationships into steady new clients.
Updated Saturday, October 3
Ask small business owners where their best clients came from and most will say the same thing: someone recommended them. Referrals arrive already trusting you, they close more often, and they tend to stay.
Why referrals beat advertising
- Trust is borrowed. A referral comes with the recommendation of someone the client already trusts.
- Less selling. Referred clients have usually decided to buy; they're choosing who from.
- Better clients. People who refer you tend to send others like themselves.
- Low cost. Your time and attention, rather than an advertising budget.
Why a referral group works better than waiting for word of mouth
Word of mouth happens by chance. A referral networking group makes it a habit: a small team of professionals who meet every week, learn exactly what each other's ideal client looks like, and go looking for those clients for each other.
With one professional per category, every member is the only person the room recommends for what they do.
Five ways to get more from a group
- Be specific. Ask for introductions to a type of client, not "anyone who needs…"
- Give first. Members who pass referrals receive more of them.
- Book one-to-ones. A coffee with each member teaches you who they're looking for.
- Follow up fast on every referral and let the giver know how it went.
- Say thank you, especially when business closes.
Measure it
Track the referrals you give and receive and the business they turn into. After a few months you'll know exactly what the group is worth to you. See how to track referrals.
Questions
How long before a referral group pays off?
Most members see their first referrals within a few months. The trust that leads to the best referrals builds over the first year.