What are referral services? A business may used this paid service to refer to them direct prospects that are actively seeking the company’s product or services. Simply put, it’s where you pay a bit to have a service tell you who is looking for what you have. This can greatly increase your ROI over standard cold calling to gather new clients.

Most of these services, however, especially those that supply non-exclusive leads, leave a lot to be desired. I’m sure that almost everyone has had the problem of buying a leads list that has already been called on by the competition four or five times already, leaving both those prospects and your sales force feeling both annoyed and let down. Which is why choosing the correct type and kind of referral services for your company is of paramount importance.

Putting money towards something eventually might pay off, but it works quicker if you have basic data about your prospective referral service before you start.

Where are these leads generated from? From their own marketing, or from an amalgamation service such as Monster, are the leads supplied? How many other companies have these already been sold to? Does this service have some sort of return or duplicate policy? When and how often will you be provided with new leads from them? (Not the best choice having a service that supplies 200 fresh leads once a month if you have 5 salesmen to support). Does this service give me thesupport I mahy need in other areas? (A client referral program etc..) Will their referral services be able to expand and grow to support more demand from me, as and when I need it? What are their current clients’ conversion ratio’s, for a similarly priced product or service as yours, when you are the referral services leads?

These questions may seem obvious, but too many people using a service seem to just fall asleep after they sign up. Decide on whether to use a service by applying the most basic form of business equation – will I make more by buying and using this, or not? The same basics apply to whether or not the service is right – Will I get what I pay for and need from them?

As with the majority of decisions facing businesses today, it is necessary to weigh the costs of implementation before taking the plunge into something new. But there are some areas that are obviously worth their cost, and one definite program to always have is a referral program.

It is a known fact that if one person recommends you to another through word of mouth then the person referred is more likely to buy. A referral program similar, except a little more methodical. Basically, it’s a method that allows your clients to recommend numerous people to your services. Remember the Pareto Principal – you’ll get 80% of your business from 20% of your clients. It is impossible to know right off the bat which ones will give the most business.

If this is new to you, it’s worth running over the basics of a referral program. It’s important to make sure that your customers are overjoyed – an unhappy client is not going to refer you ever. When a client sends you a referral, make sure you thank them. That little bit of recognition will have great meaning to a person. Reward your clients for these – it doesn’t have to be something big, or related to your product listings, just a simple form of ‘Thank You” will always be appreciated by people.

Be sincere when you ask for referrals. People usually do not spend time on something other than their own needs, so making it as quick as possible is best. Taking an idea as simple as this and using it properly can have a tremendous effect on a business’s life and growth.

A referral program should ensure that you get quality, actionable contacts to follow up on. It is not written in stone that they must “buy now” but that at some point they will change to active customers, if followed up on well. With all programs, it’s necessary for you to make sure that it’s implemented correctly too. Referral programs offering whatever will work as well if most of your sales get done in person by your sales force, or in a retail store.

Keep things straightforward and simple until you have a great system, remember that what you do well may be specific to your company only. Run the program different ways until you get the desired results – if not, make some small changes until you reach a formula that works the best.

With any referral program, it’s key to remember that you want this to do one thing, uncommonly well. A referral letter is the “next best thing” to having a personal referral, without that person knowing who will be reading their letter. This can be simple or complex, depending on your needs – as long your broadcast message is clear, then having several is a good strategy.

All high level websites have a page with customer testimonials, or referral letters. Here we have people (in some cases, allegedly) who have written in to compliment the site or product – doesn’t sound like much, does it? Over 60% of consumers have remarked that they 1) read user generated comments and 2) that their decisions have being greatly influenced by these testimonials. This is the main reason that many businesses spend large amounts on customer satisfaction and client follow-up.

With the current economic downturn, it’s no wonder that there is a high demand for these programs. Doing the little things has become so necessary that it’s worth mentioning them again briefly.

Make sure you follow up with your clients and prospects; ensure the sales and delivery process goes smoothly and to their satisfaction; follow up, every step of the way. When you’re assured of their satisfaction, then ask for a referral – or ask for a referral letter, depending on the product or service you are offering.

Where your company’s offerings are not in a wide demand setting, that is where referral letters will shine, and help to convert future customers. Knowing what these testimonials can do for your business, it’s something that should be a company mandate – to always ask for a referral, either direct or as a letter.

Integrating these letters into a sales presentation is not always easy or needed, but having them on hand to allow prospects to review an honest assessment by a previous client of your product or service will go a long way to showing that your company holds its responsibilities highly and backs it up. Taking into consideration the effect the referral letter has on sales is not easy and it’s incredibly hard to find metrics to back it up, but it is a known fact that our opinions do affect others, however trivial they may seem to us at the time, and that this influence has a huge impact on every sales arena.

Before you hire a viral marketing agency, take a moment to look objectively at your website. With a good technique, a marketer may be able to drive tens of thousands of visitors to your website. However, you are defeating the purpose if your website does not or  does not have the capability to sell your products or services.

If you are confident in your website and the products that you offer, then there are many companies you could choose from. You can even take a free course or paid class and learn how to “do it yourself”. Take time to do your research and look around. Read about the company’s techniques and see if it is something that you could apply. Try to establish how many people are in the network. Research any available testimonials.

There is one company that operates very quietly, almost hard to notice. The techniques that they use may be ok, but sites like YouTube would not approve of them. Moreover, their services can not be customized. They recommend the same methodology for all of their customers.

If they are to effectively grow your business, a viral marketing agency should tailor their solutions to suit your products or services. They should offer ways to keep in touch with your current clients and turn your clients’ friends into your customers.

One of the effective techniques is a regular newsletter, sent to your client’s e-mail address. If you have no clients, you may need to purchase a list of quality email addresses. Some of these lists were compiled by other companies. They ask their customers if they would like to receive information from affiliates. If the customer says “yes”, they become part of the company database.

It is entirely possible to locate a viral marketing agency that provides this sort of list together with their other services. To be most effective, you want the list to be targeted to include people in your niche market. If you are selling a toy, parents would be your target market. It would be wasting everyone’s time to send thousands of emails to seniors.

Some of the easier methods that you can employ include “social networking”. Become a member of an online forum or group, whose members have interests that are similar with your target. If you have yet to identify your niche, you may need a little more help than a viral marketing agency can offer. Everyone has a unique niche. In some cases, it’s just hard to see it, no matter where you stand. Someone outside of your company may be able to help you find your niche and grow your business.