Why Not Just Stick To Referrals For My Business?
Referrals (word of mouth) is the most hassle-free inexpensive form of advertising. Always has been and likely always will be.
So why bother to promote if you get referrals for most of your business?
It’s the chicken and the egg conundrum. Which comes first? You have to maintain enough traffic coming into your business to achieve the desired level of quality (by having proper staff and materials) to keep expanding. Otherwise the referrals dry up. The idea is to keep clients or customers coming in from every possible source, not just one source.
In the 21st century what do most of your “referrals” do when making the decision to see you or use your service or business? Answer: They Google your service and compare! I am willing to bet that if you asked every customer or client you have if they searched your product or service on the internet before arriving to you over 60% will say yes, whether they had you as a referral or not.
If 85% of your customers come from referrals and 15% come from other sources of advertising how does that compare with your profit margin? If your profit margin is within the 10% to 20% range (a usual amount for small to mid-range business) then the customers you get from advertising could represent a portion of that amount which puts you above the level of make-break.
It is all about return on investment. Sometimes the return on investment is not as apparent as we would like it to be. A simple question to your customers of “how did you hear about us” does not necessarily tell the whole story. An additional question “did you search our service on the internet (not just our website)” will give you more information.
There are many ways to determine if your investment in advertising is yielding you the return you want. With internet marketing you can use programs to track the amount of traffic you get from various keyword searches. There is not a foolproof method. In advertising your key is exposure. How much is the word out about your service (the more the better)?
Do all that you can to increase the referrals coming in. They are the best source of new business. Flank it with internet marketing and maintaining an excellent quality of service or product and you will be at the top of the heap, truly NUMBER ONE ON THE LIST.
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