Accelerate Growth with Zero Marketing Budget
In the flattening wake of the pandemic, small business owners need smart ways to do more with less. It’s no surprise that marketing spend is in a “record decline.”
Predictably, small business owners are upskilling on SEO, sales, analytics, and social media. (Marketing Charts has a nice curated list of related trends.)
One of the areas most overlooked by small business owners are referral partnerships. These partnerships provide a way to jumpstart revenue with zero spend on marketing vendors or tools.
Get Qualified Leads From Dealmakers
This article focuses on a specific type of partnership where an individual or a business already serving your ideal clients, agrees to send qualified leads to you because it benefits them to do so.
Why would it benefit them to send you qualified leads?
- The referral helps their client solve a problem; and so it earns goodwill for the referrer.
- The referring individual or business may also like to receive compensation from you when the referral converts.
Note that not all referrers can receive commissions: their practice area or business model may lead them to decline payment for the clients they refer to you.
Often the referring business will be one that offers a service that's complementary to your own.
But a partner can also be an influential player who is strategically in the flow of numerous deals with clients that you can service. And don’t overlook well-connected retirees.
Partnerships are an efficient way to obtain new, paying clients with minimal effort and no advertising spend. Using this tactic, you can jumpstart a new business or rapidly onboard new clients when you pivot to a new business model.
How Do Referral Partnerships Work?
Unlike ads, LinkedIn Navigator, content marketing, and other costly and time-intensive means of attracting prospects, partnerships provide a shortcut to highly qualified leads.
Here's how to get started.
The What: Identify People and Businesses
First, identify types of businesses that are already providing professional services to your ideal client. Once you put your mind to it, you’ll be surprised by the number of possibilities you come up with.
A good prompt is to ask yourself: "What other business services would my ideal client need?"
Be sure to include businesses that are offering the same exact service(s) you are, but for some reason, are unable to satisfy a subset of their clients.
Some reasons why a business might not be able to service a client might include:
- Maxed-out capacity: perhaps they don’t have the personnel or time to take on more clients.
- Geographical restrictions: Perhaps the business doesn’t service your region, town, city, or state.
- Size: Perhaps they service mid-sized companies rather than small businesses.
- Credit restrictions: Perhaps they can only service customers with a certain level of credit score, but you have a different set of qualifications.
The How: Create a Spreadsheet, Offers, and a Contract
Create a spreadsheet list with all the people you want to target with their contact information and make a plan to methodically contact all of them.
Prepare an offer in advance. For “kingpins” (the extraordinarily well-connected who can deliver repeatedly) consider offering a generous percentage. I know several small business owners who provide kingpins with 50% of any deals they send. There’s no reason a kingpin would reject that figure. If the prospect is not a kingpin, consider 30% (a figure which can be reviewed after they deliver some leads that convert).
- Draft a contract for “kingpins” and a different one for the “ordinary” partner. (The only difference will be the commission percentage.) You can likely find a basic draft template online to customize.)
- You can easily find relevant templates online by searching for "referral agreement templates."
- Use an online service like DocuSign or HelloSign to send contracts to potential partners for review and signing.
Before you send a contract to a potential partner, do a few trial runs of the send and sign process by emailing the contract to yourself and perhaps a friend. Fix any problems that you detect. This will ensure that the process goes smoothly and the document has been configured properly.
If you want a lawyer to review your contract before you offer it to anyone, there are plenty of online services, such as LegalZoom, that will provide this service at an affordable rate.
The When: Now
The faster you act on this, the quicker you'll uncover the opportunities in your network.
If your list is short, ask friend and acquaintances whether they know of anyone who might introduce you to potential referral partners. Be sure to tell them what types of jobs these referrers might hold (such as accountant, real estate agent, construction foreman, small business consultant, and so on.)
You can also start to look at all the new people you meet online or in person as potential partners. But remember: for this tactic to work, you want to select people who are in a position to deliver those leads because they are already servicing — or influentially connected to — your ideal clients.
Want to Stick to LinkedIn? Fish Upstream
LinkedIn prospecting has devolved largely to "my bot wants to chat with your bot." It's hardly a secret that many of the messages sent and received are automatically generated by tools like Dux-Soup.
Given that loads of the newly unemployed are hanging their shingle out on LinkedIn, expect the deluge to increase.
If you are currently using Linkedin Navigator for sales prospecting and want to continue that expenditure and activity, consider an experiment: shift your prospecting upstream and "fish" for referral partners instead of sales prospects.
Remember: a referral partner is essentially a commission-based salesperson.
Now you're equipped with some immediately actionable ways to get traction for your small business — even if you have no marketing budget.
Don't let the reply "No" slow you down. When your offer is declined, it's simply information. Choose a disciplined approach where nothing will prevent you from reaching out to everyone on your list of potential partners.
Successful entrepreneurs often have to plough through many dead-ends to arrive at success. Will you be one of the elite who refuse to give up?