4 Steps to Building Your Customer Base With Referrals

January 18, 2017 Rieva Lesonsky


If you own a business that visits customers’ homes—such as a handyman service, plumbing business or home remodeling contractor—you know how important word-of-mouth is to growing your customer base. When choosing vendors to come into their homes, most customers prefer recommendations from trusted sources they actually know.


But if you’re relying on customers to spread the word about your business, you’re at their mercy. Instead, why not develop a reliable source of new customers by using referrals? Here are four secrets to successfully building your business with referrals.

1. Systematize referrals. Jotting down referrals on the back of your business card or in your phone’s note-taking app isn’t the best way to go. Without an organized system for recording and organizing referrals, some of these valuable prospects will slip through the cracks. Use a customer relationship management tool to gather and organize referrals. Lighthouse 360 is one option, and it’s designed for businesses like yours. Input your customer information and you can access it anytime, anywhere, from your desktop or smartphone, including the history of work performed and notes about the customer and their project.

2. Make asking for referrals part of your customer service process. Follow up with each customer a week or two after completing their job to make sure they’re satisfied. This gives the customer some time live with your work for a bit and make sure everything is all right. As part of the follow-up, ask if they’re willing to refer a friend or family member to your business. Ideally, capture the referral information right then; if the customer doesn’t have the contact information at hand, you can send a follow-up email reminding them. Lighthouse 360 automates the process of sending emails to customers; for instance, you can send a thank-you note and a request to review your business once you’ve completed the job. Add a request for referrals and you’ll power up your business even more.

3. Use social media to get referrals. Sometimes, a customer can’t think of anyone to refer you to when you initially ask. Later on, though, they may have a friend or relative who needs your service. That’s why asking for referrals on social media, where previous customers follow your business, is a smart move. Offer some type of incentive, such as a discount on the next service, in return for making a referral. Include an email or link people can use to share the referral’s contact information, so they aren’t posting it in public on Facebook. The Lighthouse 360 app makes it easy to update your social media pages—schedule posts requesting referrals to appear at regular intervals.

4. Act quickly on referrals. Once you get a referral, reach out to the prospective customer with a phone call, email or sales letter, being sure to mention the customer who referred them to you. The connection will help break the ice and make the prospect more receptive. You should make this initial contact within a week of receiving the referral. At this time, your business is still fresh in the mind of the person who made the referral, so if the referral asks them about your business, they’ll have positive things to say. If you wait too long, the referral may no longer need your services or may have found someone else to do the job.

When used properly, a referral-building process can exponentially increase your customer base. Give it a try and see.  

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