Nspired Neworking

Credibility Goes Both Ways

Most business owners have a delightful fantasy that word-of-mouth marketing should be as simple as providing a great product or service and creating satisfied customers, which should automatically result in new customers streaming through the doors. The reality, however, is that there are many factors that affect the success of word-of-mouth marketing. One of the core factors that can make-or-break the referral process is the level of trust generated between you and your customers and referral partners.  In all forms of relationship - both personal and business - trust is a crucial element to the success of the relationship.  In business situations, the level of trust necessary to gain and maintain clients and referral partnerships can be measured by credibility. Depending on the situation, the kind of credibility that matters will be different. For example, in a sales relationship, the most important aspect of credibility is related to your product or service. Does it work? Is it a good value? Does it solve the customer's problem efficiently and effectively? In a networking relationship, it is your PERSONAL credibility that is vital.

Credibility Goes Both Ways

By Julia Hoyle, Nspired Networking Corporate Trainer - September 2015 

Most business owners have a delightful fantasy that word-of-mouth marketing should be as simple as providing a great product or service and creating satisfied customers, which should automatically result in new customers streaming through the doors. The reality, however, is that there are many factors that affect the success of word-of-mouth marketing. One of the core factors that can make-or-break the referral process is the level of trust generated between you and your customers and referral partners.  In all forms of relationship - both personal and business - trust is a crucial element to the success of the relationship.  In business situations, the level of trust necessary to gain and maintain clients and referral partnerships can be measured by credibility. Depending on the situation, the kind of credibility that matters will be different. For example, in a sales relationship, the most important aspect of credibility is related to your product or service. Does it work? Is it a good value? Does it solve the customer's problem efficiently and effectively? In a networking relationship, it is your PERSONAL credibility that is vital.

We all seem to know that referral marketing is a great way to grow our businesses. We love receiving referrals from others, and we love giving personal recommendations to others who we trust. But without the trust factor, we can be hesitant to put our own credibility on the line with our clients, family or friends. Most of us have stories of recommendations that have gone bad - and have discovered that other's lack of credibility has hurt our own credibility.  The truth is that credibility, or lack thereof, affects all individuals in a referral relationship, and it goes both ways!

Here is a personal example that I have shared many times. I had a painter, Joseph, who was in a referral circle with me. Every week he would tell the circle that residential homeowners were a good referral for him. When an opportunity arose, I referred him to my mother! Unfortunately, Joseph rarely showed up when he was supposed to, he asked for payments along the way, and he did a sloppy job overall. When my mother called him back to touch up one area he missed, she could not reach him. You can imagine how this could have damaged my own credibility in the eyes of my mother. Not only did she get bad service from Joseph, but now future recommendations I make to her will always have a little bit of question because I once made a referral that ended badly. I loaned Joseph my credibility with my mother, and he abused it. In a referral relationship, you never want to feel that you have to apologize for someone else’s lack of credibility. But when your personal credibility is on the line, YOU FEEL RESPONSIBLE FOR THE SUCCESS OR FAILURE of the referral. And ultimately, YOUR credibility has been enhanced or damaged based on the outcome.

While it's easy to see in the example above how personal credibility can be negatively affected by a bad service provider experience, here is another example from a client situation. I’ve taken time to develop strong relationships with my referral partners, so when I referred Tim, an HVAC sales and service provider, to a client of mine who owned several investment properties, I cringed when I found out my client never returned Tim’s call. It’s embarrassing to me when I say “This is a hot referral, she needs to talk with you ASAP” and then nothing happens! In this case, it was the client, not the service provider, who abused my trust by failing to return the phone call of someone I had referred to them. My client lost some credibility with me that day, and most likely, I lost a little credibility with my referral partner too. Next time, Tim may be less likely to follow up with a "hot referral" from me quite as quickly as he once did, because he remembers the time where a "hot referral" wasted his time.

So based on these two examples, you may wonder why I promote referral marketing. Ok, I get that.   However, remember when I said that credibility goes both ways? This is true for the bad AND the good referrals.  For all the examples where a negative experience hurts one or more person's personal credibility in a referral relationship, there are many, many more examples of successful referral transactions that have resulted in increased credibility for ALL parties involved. I have even been referred to as a rock star by both clients and referral partners for having successfully referred the right people for the right situations to solve my clients' needs, resulting in happy clients and profitable referral partners.  And I look like a hero.  It's a win-win-win all around!

Ultimately, both negative and positive actions have consequences in referral relationships that can and will affect your bottom line. Respect the referral process, honor the referral relationship and always be mindful of everyone’s CREDIBIILITY that can be impacted by your actions.

I am Julia Hoyle, I hope you enjoyed reading my article.  If you would like to connect with me to setup a 

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