Who should I refer and why?

Referrals are about helping others succeed.

If a business owner or a customer shares they are experiencing a problem that your business does not solve, you should immediately refer them to someone you trust who can help them solve that problem. 

By helping them become successful, you will establish your business in their mind as positive and trustworthy. As a result, chances are that they'll want to return the favor by either helping you in the future or by referring your business to someone they come across who has a need for your products and services.

In this scenario, as a result of your referral you built trust with two businesses by helping them both grow their businesses:

• Person A: The person or business you trusted could deliver a solution to a problem.
• Person B: The person or business you referred Person A to.

Now, this is only effective if Person A can deliver the solution to the problem that Person B has. If Person B's expectations are not met, they will end up not trusting your business as much.

Let's look at a classic example in the Real Estate industry:

Let's say you are a Real Estate Agent and your client mentions that they want to renovate their kitchen so that they can improve the value of their home. As a Real Estate Agent, you can refer a trusted contractor to your client.

If the contractor delivers a kitchen that your client is happy with, both your client and the contractor will see you as someone they can refer to their own customers, families, and friends. And this all happened from one referral.

The more people and businesses you refer to each other, the more referrals you will receive in return as a factor of all of the trust you built with those businesses.

By understanding this concept, you can start driving an incredible amount of word-of-mouth referrals for your business and see your skyrocket.

But this concept can be further enhanced by who you focus on building relationships with as there are specific types of businesses in relation to your ideal customer who can help you maximize even more the number of referrals you can receive. We've laid this out in our article Understand who to network with and why.