By Michael Brizz, CMC, CSP
Creator of The Referral Mastery System
The fantasy: a horde of other companies sending you all the referrals you desire. The reality: hundreds of hours squandered trying to develop relationships with complementary service providers with little to show for your effort.
The logic of linking with other professionals to better serve your clients is compelling. In addition, there is much to learn from the right partners. And with coordinated marketing, everyone wins by securing new business they would be unable to secure without the alliance. For most sales producers, the dream of linking with other professionals to grow each others’ businesses never becomes reality despite the provider’s earnest efforts to build those relationships and give referrals. Far too many providers commit to an alliance initiative without a clear strategy, without defining expectations, and without measures for success.
What we all discover, sooner or later, is that not everyone is a good alliance partner. While most complementary professionals are very willing to accept your referrals, very few are willing to commit to a productive win/win/win alliance. Successful alliances start with finding the right partner. A mistake during this phase of the process dooms the alliance to failure. No effort in the future can make up for the wrong partner.
What are some common mistakes?
1. Trying to forge alliances with little understanding of the potential partner’s client base, marketing strategy, or growth objectives. An alliance makes sense if both alliance partners are focused on serving the same type of clients. Just because you have capabilities to help a wide range of people, does not mean you should establish alliances to serve all these different types of people. An alliance with a divorce and family practice law firm is very logical if your target market is divorcees. However, it is just a waste of precious resources if you are targeting 401K plans or payroll services.
If the attorney or accountant is in the “wind down” phase of their business, it is unlikely they will be a strong referral source for you. While they may have a large client base, they are no longer trying to grow their business. They don’t have any incentive to invest in an alliance that will pay off down the road.
2. Misfit of business maturation or size. If you are a solo producer with a relatively small practice and you are trying to link with the most established provider in town, you have little to no significance to that provider. They likely have established alliances that were put in place a long time ago. Unless you provide special expertise or an opening to a market that is a target for them, it doesn’t make sense for them to invest much in a relationship with you. Will they accept your referrals and be gracious about saying “Thank you?” Yes. But will they invest in a relationship with you? Not likely. It doesn’t make sense for them to do so when there is a mismatch of what each party can provide to the other.
3. Trying to forge too many alliances. Alliances frequently require a serious commitment of nurturing before they bear fruit. There are a limited number of alliances that you can effectively support. An alliance can’t last if both parties fail to provide sustained support.
How do you select the right partners?
First, clarify your target market: who you want to serve and how you want to distinguish yourself in that target market. This will help you develop your selection criteria and determine what role you want the other professionals to play.
Second, develop your vision of how you want an alliance to work for all the parties. What roles do you see each partner playing?
Third, define your criteria of what you want in an alliance partner. Consider the following:
- Fit of client base: Do they have a client base that is attractive to you and do you have one that is attractive to them? You can’t expect a partner to invest time and money pursing business that is not in alignment with his or her marketing goals.
- Fit of growth objectives and marketing strategies. Are their growth objectives and beliefs on how to generate business compatible with yours?
- Complementary expertise. Alliance partners must provide expertise that serves the needs of your target market. The alliance should provide all alliance partners with a competitive advantage because of the distinctive combination of competencies you provide collectively.
- Position to recommend. Do they carry enough influence with their clients so that an introduction from them is treated like a strong recommendation? The housekeeping staff person may be on very friendly terms with the law partner however his opinions have little influence on legal or financial matters. Are they limited by a perceived “conflict of interest” and therefore unable to refer you?
- Willingness to invest: Is the other party willing to invest time, money, and exposure to their client base to the same level you are? Get these issues out on the table quickly and test them by asking for an early commitment of time and money.
- Are they dependable? Do they provide quality service and do they fulfill their commitments as an alliance partner? Ask if they have worked with others in the past in similar types of alliances. Find out who they were and call them.
- Potential value to the partner. The alliance must be worthwhile to your partner. Define specifically what you feel they can gain from it and strive to structure the partnership so both parties win in a roughly equal manner.
Fourth, develop a list of candidates by asking clients and others in your network to recommend service providers they view highly.
Fifth, interview a few for the purpose of exploring an alliance. Learn about their vision for their business, their growth objectives, their client base and target market, and how they see an alliance fitting with their marketing strategy.
Sixth, start with the one (maximum two) person or firm you feel is the best fit and create a joint marketing plan. Develop a clear set of expectations for both parties. Identify an event or some marketing initiative where both parties must invest. This will give you an early indication of their commitment. Establish measures of success. Set short-term goals such as the number of referrals you will generate for each other in the next quarter. Then review the progress quarterly to see if both parties are meeting the expectations and how the strategy is working. Only when you have one alliance working well (or you decide it can’t work) is it the time to explore the potential for another win/win alliance.
With these steps, you will save time because you will focus only on those who have real potential to enhance your practice. You will also quickly distinguish between those who can be serious partners and those who just talk a good game.
An alliance strategy can provide big wins if you have the right partners and support them well. You are much more likely to succeed by focusing on a small number where there is good fit of target market, marketing objectives, and expertise. A small number of highly effective alliances is vastly superior to a large number of ineffective ones.
Michael Brizz, CMC, CSP is the creator of The Referral Mastery System® (www.referralmastery.com). He works with sales professionals to drive their business growth through referrals. He can be reached at 800-865-2867 or mike@referralmastery.com.