Thursday, January 3, 2008

Triple your referrals...

I am very confused about why consultants keep using strategies that don't work. You would think that the experience of disappointing clients over and over would have them find ones that do work. Imagine if people had tools that worked to grow their businesses - predictably. Well, I found a great one that does work:

It is a predictive model for increasing referrals (that is: viral marketing, word-of-mouth, more customers, more prospects).
The N.U.D.E. Model of Referral Marketing was developed by a mathematician in Texas and it explains what goes on in the subconscious mind when someone decides whether or not to refer things to other people. [Remember, we buy for emotional reasons and back up our decisions with logical ones]. Referrals / word-of-mouth work much the same way. We have to feel ok to do it because our reputation is on the line.

It turns out that there are 4 factors that must be present for us to feel ok to refer. Yes, N.U.D.E. is an acronym: Novelty, Utility, Dependability & Economy. Here is the bad news. Referral activity has nothing to do with doing the best job. It turns out that if you are not the best at what you do, you can still have a referral only business. Now, this might be good or bad news depending on who is reading.

There is a book on the N.U.D.E Model that explains the 4 factors and how to increase your score and get more referrals. Many of my friends and clients have been able to triple their referrals with this model. My friend Keith (see picture) owns a water company. After reading the book he put all his sales and delivery guys in kilts. He put "Men In Kilts Deliver" on his delivery trucks. He immediately lost one sales guy who didn't want to wear a skirt. He got a lot of flack from his employees. Then, employees from other water companies started applying for jobs and brought their customers to his company. He was in the paper - in a kilt. People stopped his guys in elevators to ask where they worked. His business started growing by word-of-mouth without changing anything about his product or service.

People do have mixed results implementing this model. There are a few criteria for getting results. One, you have to read and finish the book. Two, you have to implement what you learn. Three, you might have to try a few strategies before you find one that works. You also have to tell the truth. If you really don't offer a dependable experience (you don't call people back, or waiting times vary) word-of-mouth activity won't happen until you fix it. The book is privately published by Scott Degraffenreid. You can buy it here or google it - prices are the same.