By Al Pirozzoli

Companies invest untold billions in every form of marketing imaginable. Although much of it is effective, there is one form that tops all the others. For effectiveness and results, referrals are second to none.

Up to 45 percent of most service businesses are chosen by customers based on the recommendations of others, and referral marketing is virtually free. There you have the real power in fueling more sales for your painting company.

The psychology of referring

Many painting contractors, like other service businesses, assume that referrals will happen by themselves, and occasionally they do. But if you truly believe that your painting company does make a difference in the customer’s life, you should be chomping at the bit to launch a referral program. Here are two keys to understand:

• Some customers will refer you to others if you ask.
• Other customers want to give you referrals because it makes them feel good that they found a great service with which they had a good experience. It’s known as positive pride: They have found a great solution and want to share that “secret” with friends and contacts. Making a referral also creates a sense of being “in the know” – and that you have done someone else a favor. This is a win-win for your painting business on every level.

Keep the following things in mind as you develop a basic plan for referrals in your business.

1. Mindset

You must begin to focus on referrals as one of the life-giving arteries feeding your business success. If you are not proactive in creating a referral initiative for your company, the chances of you receiving many referrals drops off rapidly. You become too busy working “in” your business to spend any time working “on” your business.

I see many small and mid-size businesses fall into this trap. They fall under the false assumption that just doing great work will get them business and they go into shock when they lose business.

Customers may be delighted with your painting service, but they get busy. Life gets in the way and they forget. Once you have completed the project, they’re off to work, driving kids to school, going to the gym, and on it goes. The excitement of the newly painted room fades.

Therefore, it’s your job to help those happy customers go to work for you and refer. Develop a mindset of gaining referrals as part of your everyday business. It’s as important as sending invoices.

2. Consistency

I believe that inherently most business owners know that they must ask for referrals, but it’s the discomfort of asking that often hinders them.

When I conduct sales and marketing workshops one of my first questions to the contractors and their people is, “Raise your hand if you are in sales for your company.” Only a few hands go up. That’s when I make the point: Everyone in your company is involved in sales!

If you run a business, you as the leader must understand the absolute need for ongoing referral marketing. It isn’t something you do when you think of it. It’s something you do with consistency.

3. Follow-through

To encourage referrals, you need to strike while the iron is hot. When your customer is beaming with satisfaction and excited about your paint job, that’s the time to ask for a referral.

Ask if your customer will call and introduce you. You might follow up with a small postcard reminding them to refer you. The campaign can be based on a “Tell a Friend” theme. You might offer the referrer a gift card for any referral that produces a painting project. This could be a gas card or a gift card in $25 or more.

One of the most effective ways is to send a short letter asking for referrals. Letters are still very powerful. Or you can set up an account for current customers and whenever they refer to you, at the end of the project, and after the check clears, you deposit 5 percent of the amount into their account (use whatever number you feel is viable). A customer’s account will eventually have enough credits to have a room painted based on their account credits.

Or you can offer the current customer a discount of 10 percent on their next painting project for a qualified referral. This gets you a referral and hopefully another project from an existing customer.

Another great idea is to shoot video of a few happy customers giving a testimonial, and get their permission to launch the video on YouTube. Also, include written testimonials in your letters to support the idea of referral. Get testimonials on your website.

Bottom line: Work it!

Be creative! There are many ways to encourage referrals from existing customers. Once you see the results of a consistent referral program, you will never look at your business in the same way again. Referrals work – if you work them!

This article was written by Al Pirozzoli and was originally published in the Spring 2016 issue of PPC magazine. Al can be reached at www.pirozzoli.us. More business-building stories can be found at the Sherwin-Williams painting contractors website.