5 ms·

B2B referral sales systems – the outbound growth engine most startups never use

69 points by SteliE 13y ago

23andwalnut 13y ago
What do you think about having this process automated? The initial ask can be an automated email and if the person wants to do a referral they can grab an email template via a link included in the email. I'm asking because many businesses don't speak to their customers unless they have an issue or a post purchase question....
- SteliE 13y ago
  Yeah that's a fair point. If you don't talk to your customers today it might make sense to automate this via email. Most likely you will have a much lower success rate since the biggest point of conversion in the approach outlined in the post is at the "2nd ask" (which is hard to do via email). But it's a lot better than not asking for referrals in the first place :) Would love to hear what kind of results you would see doing this!
iterable 13y ago
nice one Steli
dsugarman 13y ago
what about referral incentives?
- SteliE 13y ago
  oh that's a good point! I need to edit that into the original post :) I've found that in B2B you don't want to "pay" for referrals and that people are more likely to make them when they feel like they are providing value to their network without any selfish incentives. Once in a while someone will ask for it and it's up to you to decide if you want to give people a discount or something else for helping you close new business. I personally think that's reasonable when asked but wouldn't offer it upfront.
  - dhfromkorea 13y ago
    Really interesting insight, Steli. Did you ever offer a discount up front to get reluctant customers to introduce you to a new business[1]? If so, could you share how it turned out? [1] those who likely know a business to introduce you to and are seemingly willing to do so, based on the maturity of the relationship with you and them.
ivankirigin 13y ago
Steli and I just chatted about this one, and I love it. I help make YesGraph, a referral recruiting tool. We're just getting started ramping up sales, so something like referrals that keeps the new leads warm is wonderful. Plus the marketing message that we are all about the referrals writes itself.
- SteliE 13y ago
  Never seen a case where referral sales makes more sense than at YesGraph :) Excited to see the results you guys are going to get from implementing this!
andrewcross 13y ago
This: “It seems like we're a great fit. I'm excited. Before we go any further exploring a potential deal I want to bring up that we're fully focused on building world class technology and on servicing and supporting our customers to massive success. What that means is that we're not investing in marketing and sales as heavily because our happy customers are referring us to others who could benefit from our product. Does that sound like a fair arrangement to you?” What a great way to phrase the ask. Switches from you pressuring them for the referral to making them want to help.
- notastartup 13y ago
  Reading through that phrase makes me want to help the little guy out and surprise, if it works on me, it must work on at least others.
- hajrice 13y ago
  This is very typical way of approaching sales and arrangements in the sales world. Sandler sales and a lot of other sales techniques / principles apply this, and I've seen it work wonders
esharef 13y ago
Hey Steli, quick question: You suggest we should ask for the referral right when the customer makes the purchase. In the case of a SaaS solution (like ours) they haven't experienced the product at all right when they make the purchase...isn't it better to wait until they have experienced the product to ask for a referral (eg when they've had a success on the platform)?
- SteliE 13y ago
  Yeah that's what most people think (and sometimes it's the right approach). For most SaaS apps your customer had a chance to experience the product on a free trial of some sorts. If they are convinced enough to buy many will be ready to recommend. Asking for it at that point only shortens the referral sales cycle (you don't have to schedule a separate call for this since you're already talking to them) and once you've closed the positive feedback loop they can start giving you more referrals (and at that point they've probably been a customer for a month or two). Starting earlier just makes this gain a lot more momentum faster.
veesahni 13y ago
How applicable is this approach for a low-touch B2B SaaS business? We don't have active sales communications with customers, it's more of a value creation during the trial period. I have noticed that customers referred by their friends (without us asking) move through the process very quickly. They already trust us.
- SteliE 13y ago
  You might wanna try sending customer lifecycle emails to customers after a few weeks pitching them on referring you to their friends and see how well this performs. I don't have first hand experience in automating this via email. My experience has been exclusively with phone sales so far.
jsonne 13y ago
Fantastic post. I did a rough version of this for a while and it works great. One thing I didn't think of was closing the feedback loop like you suggested. Usually I did that myself through the form of a casual gift (beer, etc) but I can see your way being much more effective. Its really amazing how well this works too. I recently made the jump from tech to advertising, and I actually built us to ramen profitable doing exactly this. The trick was a bit of pro bono work at the beginning to light the fuse.
notastartup 13y ago
what's the tech behind the close.io app? looks like a thin layer client such as node-webkit running bootstrap or HTML5 of some sort. I wonder how it's doing the VOIP and Email. I absolutely loved the demo video on close.io, it's the only demo video where I knew exactly what was going on because they slowed it down.
- philfreo 13y ago
  Thanks for asking! I wrote a blog post about it: http://blog.close.io/the-tech-stack-behind-close-io-sales-communication http://blog.close.io/the-tech-stack-behind-close-io-sales-co...
  - notastartup 13y ago
    Wow thanks for the answer! Where do you host the backend? I think Flask is a great choice, it is easier to deal with than writing a backend in Node.js.
BorisMelnik 13y ago
kind of angry this got found. use this all day everyday as my entire system.
sbhere 13y ago
Does B2B refer to "business-to-business" in this case?

69 points by SteliE 13y ago

What do you think about having this process automated? The initial ask can be an automated email and if the person wants to do a referral they can grab an email template via a link included in the email. I'm asking because many businesses don't speak to their customers unless they have an issue or a post purchase question....

SteliE 13y ago
Yeah that's a fair point. If you don't talk to your customers today it might make sense to automate this via email. Most likely you will have a much lower success rate since the biggest point of conversion in the approach outlined in the post is at the "2nd ask" (which is hard to do via email). But it's a lot better than not asking for referrals in the first place :) Would love to hear what kind of results you would see doing this!

iterable 13y ago

nice one Steli

dsugarman 13y ago

what about referral incentives?

SteliE 13y ago
oh that's a good point! I need to edit that into the original post :) I've found that in B2B you don't want to "pay" for referrals and that people are more likely to make them when they feel like they are providing value to their network without any selfish incentives. Once in a while someone will ask for it and it's up to you to decide if you want to give people a discount or something else for helping you close new business. I personally think that's reasonable when asked but wouldn't offer it upfront.
- dhfromkorea 13y ago
  Really interesting insight, Steli. Did you ever offer a discount up front to get reluctant customers to introduce you to a new business[1]? If so, could you share how it turned out? [1] those who likely know a business to introduce you to and are seemingly willing to do so, based on the maturity of the relationship with you and them.

ivankirigin 13y ago

Steli and I just chatted about this one, and I love it. I help make YesGraph, a referral recruiting tool. We're just getting started ramping up sales, so something like referrals that keeps the new leads warm is wonderful. Plus the marketing message that we are all about the referrals writes itself.

SteliE 13y ago
Never seen a case where referral sales makes more sense than at YesGraph :) Excited to see the results you guys are going to get from implementing this!

andrewcross 13y ago

This: “It seems like we're a great fit. I'm excited. Before we go any further exploring a potential deal I want to bring up that we're fully focused on building world class technology and on servicing and supporting our customers to massive success. What that means is that we're not investing in marketing and sales as heavily because our happy customers are referring us to others who could benefit from our product. Does that sound like a fair arrangement to you?” What a great way to phrase the ask. Switches from you pressuring them for the referral to making them want to help.

notastartup 13y ago
Reading through that phrase makes me want to help the little guy out and surprise, if it works on me, it must work on at least others.
hajrice 13y ago
This is very typical way of approaching sales and arrangements in the sales world. Sandler sales and a lot of other sales techniques / principles apply this, and I've seen it work wonders

esharef 13y ago

Hey Steli, quick question: You suggest we should ask for the referral right when the customer makes the purchase. In the case of a SaaS solution (like ours) they haven't experienced the product at all right when they make the purchase...isn't it better to wait until they have experienced the product to ask for a referral (eg when they've had a success on the platform)?

SteliE 13y ago
Yeah that's what most people think (and sometimes it's the right approach). For most SaaS apps your customer had a chance to experience the product on a free trial of some sorts. If they are convinced enough to buy many will be ready to recommend. Asking for it at that point only shortens the referral sales cycle (you don't have to schedule a separate call for this since you're already talking to them) and once you've closed the positive feedback loop they can start giving you more referrals (and at that point they've probably been a customer for a month or two). Starting earlier just makes this gain a lot more momentum faster.

veesahni 13y ago

How applicable is this approach for a low-touch B2B SaaS business? We don't have active sales communications with customers, it's more of a value creation during the trial period. I have noticed that customers referred by their friends (without us asking) move through the process very quickly. They already trust us.

SteliE 13y ago
You might wanna try sending customer lifecycle emails to customers after a few weeks pitching them on referring you to their friends and see how well this performs. I don't have first hand experience in automating this via email. My experience has been exclusively with phone sales so far.

jsonne 13y ago

Fantastic post. I did a rough version of this for a while and it works great. One thing I didn't think of was closing the feedback loop like you suggested. Usually I did that myself through the form of a casual gift (beer, etc) but I can see your way being much more effective. Its really amazing how well this works too. I recently made the jump from tech to advertising, and I actually built us to ramen profitable doing exactly this. The trick was a bit of pro bono work at the beginning to light the fuse.

notastartup 13y ago

what's the tech behind the close.io app? looks like a thin layer client such as node-webkit running bootstrap or HTML5 of some sort. I wonder how it's doing the VOIP and Email. I absolutely loved the demo video on close.io, it's the only demo video where I knew exactly what was going on because they slowed it down.

philfreo 13y ago
Thanks for asking! I wrote a blog post about it: http://blog.close.io/the-tech-stack-behind-close-io-sales-communication http://blog.close.io/the-tech-stack-behind-close-io-sales-co...
- notastartup 13y ago
  Wow thanks for the answer! Where do you host the backend? I think Flask is a great choice, it is easier to deal with than writing a backend in Node.js.

BorisMelnik 13y ago

kind of angry this got found. use this all day everyday as my entire system.

sbhere 13y ago

Does B2B refer to "business-to-business" in this case?