Building Your Referral Machine


With all your tools in hand, it’s time to commit to the development of a referral habit that will pay untold dividends over the course of your business career. (Even if you’re not in sales or marketing, the ability to generate business – to be a rainmaker – makes you more valuable in any position.)

The first thing you must do to build a referral machine is to make a serious commitment to gathering referrals and following them up. You can often double or triple your referrals by simply asking for them. Not sometimes, not when you feel like it, not when you are having a good day, not if you feel the prospect likes you, but ask every single time in as many different ways as you can until you get what you need. In the book Marketing Your Services: For People Who Hate to Sell, the author (Rick Crandall) says that most people have a “prayer” referral system – they simply hope that someone will give them a referral! They say it takes 28 days of constant repetition to develop a habit, so give it a go, starting today!

Develop a calendar, a check off list or some other kind of tickler file, so that you can make asking for a referral a habit. Start by setting up a recall of your new members, 2 weeks after they have joined. Use this phone call to not only find out how they are doing at the club, but to ask about referrals. This call is a great way to say that you care and continue the rapport. Be sure that they are using the club and meeting other members as connected members will be long time, happy members. A referral will be a natural by-product, if they are assimilating into the fold.

Whenever you get a referral, try to find the connection between the person referring and the referral. Ask how Joe knows Harry. Ask how long Sally has been friends with Chelsea. Ask what line of work the prospect is in. The more information you have about the referral, and the clearer you are about the referral’s relationship with the referrer, the better are your chances of a successful presentation.

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When possible, get an introduction beforehand which will make your call much easier on the front end. If you can get the referrer to let the person know who you are in advance, the call will be much smoother. If not, be sure to mention the referrer even before you mention your name so that you have their attention immediately. This may take a little getting used to as we generally introduce ourselves first, but it assures that you have the caller’s attention when he hears the name of his friend or business associate first. For instance, “Hello Mr. Mickelson, Tiger Woods asked that I give you a call. My name is …” You can be sure that Mr. Mickelson is listening.

Show your gratitude

Once you have received a referral, whether it works out to your advantage or not, make sure that you thank people. When a customer gives you a referral that results in a sale, make a big production out of the event. At the very least, you should send him a “thank you” note. If the amount of money involved in closing the sale is substantial, consider sending the customer who gave you the referral a suitable gift for his assistance. Find something personal such as a book on a subject that interests him, or a bottle of his favorite wine, this gift will go a long way toward ensuring that this particular customer will continue to refer good prospects to you.

Reward with Money?

Many clubs offer a financial inducement to encourage referrals but they do not always work. If you give out a “bounty” for a referral one time then it will be expected thereafter every time. Be careful as it can get out of hand.

You want to position the referral as favor; not as something with a price on it.

Studies show that a large percentage of people feel uneasy about being paid for referring their friends, unless their friends benefit equally in the process. They get a $500 credit when their referral joins and so does the new member. They get a staff bag when their referral joins and so does the new member. They get a cruise when their referral joins and so does the new member, etc. Coming up with a reward where by both parties benefit is by far the most effective way.

Ask again for referrals

Every time you thank a member for a referral, you have the opportunity to repeat the cycle by asking for another referral. Always end each “thank you” communication, whether it’s a letter or a phone call, by asking if the customer knows of anyone similar who might benefit from what you have to offer. Remember, the best time to get a referral is soon after a sale. The same is true of a referral, once a person has started to think about who else can benefit from your club. Strike while the iron is hot and ask for more names at once.

Make it easy to get referrals

The easier you make it for other people to promote you and your club, the more they will do it. Provide free Member for a Day or Preview Passes for visitors at the pro shop, restaurant or front gate whereby the offer is initiated through the Membership Director. At a seminar with over two hundred people in Las Vegas, I distributed 200 postcards and asked all the audience members to write down the three most important things they had learned and sent the postcard to a friend who could then remind them to take action on these items. At the next break, I announced that if everyone would drop the postcards up front, my secretary had a bunch of 20-cent stamps and would take care of mailing them. 90% of the people present dropped them off for mailing! 180 referrals in the mail at a whopping cost of $36! Now, to me that makes a lot of sense.

The law of large numbers

The more people you know, the more referrals you get! Now that’s a pretty simple concept, isn’t it, but far too many people involved in sales fail to take advantage of this simple fact! Join the club or association in your town that will bring you into contact with the largest number of prospective contacts!

OK, so there are already ten people in your field involved in the Chamber who is more established than you are, so now what? Well, before you take the next step consider this; more than half of them never go to a meeting anyway. Of the half that go, they only go once a year or spend their time in aimless socializing rather than building relationships. As Woody Allen said, “99% of the job is just showing up.” If you still feel there is too much competition in the local chapters of whatever organization you have considered, try a jump to left field and change the game. Join a related organization rather than the most obvious. Join the chamber of the next town over, or instead of the realtors’ association join the builders’ association or the mortgage association.

Word of mouth is the life blood of any golf course, but you receive good words a whole lot more predictably and effectively when you develop and follow a system so that good leads don’t just slip through the cracks.

Look for opinion leaders; they are everywhere

Everyone is an opinion leader — at least to a few people. Some are opinion leaders to hundreds or perhaps even thousands of people. In Joe Girard’s remarkable book, How to Sell Anything to Anyone, he talks about the “250 rule.” Basically, this states that everyone knows at least 250 people, and each of them knows another 250. Get the idea?

I know many more than 250 people and I conduct seminars and give lectures to thousands across the country. What if the person to whom you are selling something is in the same position as I, coming into contact with thousands of new people every year? What appears to be an individual, isolated sale could turn into hundreds of sales. Ask questions after each sale to find out what you can about your customer’s sphere of influence. (See Loyalty Module)

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Sales cycle leads

Certain products have sales cycles. On average, people buy a new home every seven years. When golfers up North hit their late forties or early fifties, they start looking for a home in the SUN! Being aware of your product’s life cycle gives you the edge in knowing when a previous customer will be ready for another purchase. Keep an active file in your computer’s database that lets you know a couple of months in advance when these previous customers will be at their hottest to replace the old club or house.

Setting Up an Ambassador or Membership Committee

Why take care of all referrals yourself when you can enlist the help of others? You can develop your own Ambassador or Membership Committee. This very well could be the most important committee that you ever set up at your club since it deals with the lifeblood of your club – membership!

In short, your goal is to have a select group of members dedicated to reaching out to the community on your behalf to find new members. Their role is to help ensure continued growth at the club for the final goal of a full roster at the club. The ultimate (albeit mighty) goal for a private club is to reach its membership cap and have a waiting list of people to join.

Look for people who want to have an official role in your success. Identify members that are influential movers and shakers of your community. Find respected members who are in touch with your market. Maybe they are in fields like insurance where they want a reason to meet more people. They are likely to be naturally outgoing, personable and persuasive people. Maybe they are retired and have time and want to be involved.

All members of the club should be involved in the process of referring others. Even the most connected of members will eventually run out of friends, associates, contacts, etc. to refer so the real purpose of the membership committee is to develop an ongoing plan to educate and involve all club members in the referral process. They can help identify pockets of opportunity and new markets to tap for potential prospects.

The membership committee will host prospective members and be rewarded on a structured program based on their success in attracting new members through their strategies and plans of involving the entire membership. They are the eyes and ears of the membership and can make recommendations to the club about the creation of new programs, services, etc. that the club might offer to increase member involvement and thus satisfaction resulting in higher retention. They should be looking for ways to get all members, especially new ones, involved and connected to the club, its members, and its activities. Happy, satisfied, and involved members will refer the club to their circle of influence.

Have regular meetings with an agenda, create a mission statement, set goals, and reward efforts. Make the meetings fun. Have guest speakers, run contests to see who can bring in the most referrals among the committee, do something unexpected and surprise the group each meeting in appreciation for the arduous task they have committed to, such as, having ice cream sundaes or flaming coffees served by the chef, giving them a special trinkets from the golf professional, having a masseuse give each a 5 minute foot rub. Present flowers to the ladies and cigars to the men or a bottle of wine to all. Be creative as your membership committee can be your most valuable resource. Have an annual appreciation dinner with “no holds barred” for this special (and valuable) group.

Appoint or elect a president. Let him send a referral reminder letter to the general membership on his behalf (not the clubs) at least once a year along with the new welcome letter to all new members. (And yes, there needs to be a paragraph in the new member welcome letter about the honor and privilege of giving referrals.)

This committee should also be present at any membership prospect function and be willing to serve as a sponsor if needed for either a golf game, or for membership (if needed at your club). They should be Club Ambassadors within the club and within the community.


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