The Referral Engine: Teaching Your Business to Market Itself

Citation

Stanaland, A.J.S. (2011), "The Referral Engine: Teaching Your Business to Market Itself", Journal of Consumer Marketing, Vol. 28 No. 7, pp. 550-551. https://doi.org/10.1108/07363761111181554

In our new world of consumer‐driven content and customers' reliance on the recommendations of others, The Referral Engine prescribes an approach to generate and harness customer word‐of‐mouth for competitive advantage. Author John Jantsch seeks to teach small business owners how to build their own referral system to generate and capitalize on customer feedback and recommendations. At the heart of this very readable book is a message to small business owners: “Your business is worth recommending and just needs the right process in place to allow customers to sing its praises”. The Referral Engine teaches this process.

Written in manageable chunks within 13 chapters, The Referral Engine is a handy guidebook that you will want to read, think about, and refer back to. Although the premise of the book is not revolutionary, Jantsch's approach provides both the psycho‐social underpinnings of the customer referral phenomenon as well as snappy checklists and lively examples to follow for implementation of his techniques.

Chapter 1 explains the social drive that encourages us to make referrals and states five “Realities”: People make referrals because they need to; all business involves risk; nobody talks about boring business; consistency builds trust; and marketing is a system. The takeaway from this chapter is essentially that humans are socially motivated to make referrals, and that such referrals can be a valuable part of building relationships with current and future customers. Jantsch contends that most small business owners intuitively know this but have no system in place for stimulating a culture of referrals.

Chapter 2 contends that trust is the key to recommendations, and you create trust with customers by first developing employees who will put your business's best foot forward. This includes treating employees like you want them to in turn treat customers, hiring employees with “fit” in mind, empowering them, and ultimately creating an environment that encourages open communication and a “give‐to‐get” mentality when it comes to earning customer trust and positive feedback. The author claims that “highly referred businesses are good enough to make people want to talk about them, but they amplify this natural desire by making word of mouth an essential element of the culture” (p. 23).

Chapters 3‐7 continue not just with the philosophy of referral generation (chapter 3: The Path to Referral and chapter 4: The Referral System View), but also get into the strategic approach to referrals (chapter 5: Your Authentic Strategy; chapter 6: Content as marketing Driver; and chapter 7: Convergence Strategies). Chapters 8‐10 (Your Customer Network, The Strategic Partner Network, and Ready to Receive) then provide the nuts and bolts of stimulating customer recommendations, with a very practical emphasis on digital and social media. Chapter 10 in particular is the crux of this book, with step‐by‐step instructions on how, when, and where to pose a referral request such that readers can create their own “ready to receive action plan”. “Remember, you are not asking your clients for help”, Jantsch writes, “you are offering to help them get more of what they want. Use your expertise to make them look good, add value, and enhance their status. Now that's a winning proposition” (pp. 187‐8). Finally, chapters 11‐13 (referral‐specific campaigns, snack‐sized suggestions, and workshop) provide concrete exemplars of the author's approach to referrals with detailed suggestions for readers.

Peppered throughout the book are nuggets of wisdom such as:

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  “… there are no real secrets in business – only truths you haven't yet figured out how to apply” (p. 3).

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  “The most effective long‐term cultural shift for most organizations comes when the focus is put on making the total customer experience something worth talking about on a case‐by‐case basis” (p. 24).

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  “The last stage of the customer referral life cycle is for your customers to become such total advocates for your business that they operate as a form of uncompensated sales staff … the ultimate goal is to lead every customer to this place” (p. 48).

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  “Better to innovate around a proven market, borrow genius from an unrelated industry, or discover an unmet need in a mature market crying for a solution” (p. 59).

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  “Content is the most effective form of advertising … use your advertising to start conversations and draw people into content that builds trust and community, and you'll harness the ever‐effective power of advertising for generating leads and sales” (p. 102).

This book would be valuable to the small business owner looking for practical ways to convert customer word‐of‐mouth into effective marketing communications. It would also be useful as a supplement in the classroom for a marketing strategy, IMC, or even a consumer behavior course, due to its focus on the effects of word‐of‐mouth on customer trust and choice.