About five years ago next month, I was at this trade show in the “luxury travel” space — how off-brand for me is that, right? Gimme a break, I needed a job at the time — and my main job was to help travel advisors with writing bios of themselves, branding themselves, etc. I probably talked to 240 travel advisors across the week, OK? Whenever I asked them about their business models, most said “90–99% referral.” Makes sense. Who all would use a travel advisor at this point but the very rich, right? And the very rich is a big interconnected world of admins and assistants and “Hey, who’s your guy for this?” So I got it, inherently.
OK, well, we know that the majority of small business owners rely massively on referral, and we now that 60% of companies with a referral process have faster close rates. Referral rates have also been called “the one number you need to grow,” and people are 4x more likely to buy when referred by a friend. (Here are a few more referral stats.) Oh, and PS while we’re on these stats, 84% of B2B decision-makers typically start their process with referrals.
This is all logical, right?
Totally. Everyone wants to scream from the rooftops these days about AI and machine learning and blockchain and advanced technology, but the fact is… none of those things have really “arrived” yet, and all most of them constitute at present is advanced digital noise. Digital noise is just that: noise. As a result, one needs a path through the clutter and the bullshit.
What’s the path? Someone you trust telling you something, and you going and doing that thing.
Easy example: I bought this TV and it’s awesome. Check it out.
Mid-level example: This guy was a good co-worker back at this hell-hole we used to share desk space at. Look into him.
High-level example: I get my fighter jets from this company. Consider them for your next multi-billion purchase.
It works low-level to high-level and it’s the perfect antidote to today’s “Attention Economy,” because it gets you intel from a trusted source quickly and you move forward with your thinking and decision-making that way. It pushes aside all the screeching and the bullshit and the “thought leadership.” Logical, right?
Let me refer you some stuff as an example
I use Sun Basket as a meal kit. It’s good, ships on time, has good ingredients, the portions are solid, and it’s largely organic. Trust me? Get your own here.
Morning Brew is a newsletter I subscribe to. Good coverage of pop culture, politics, business, and random whatever pretty quickly. If that interests you, sign up.
So, see … now if you were interested in either of those, you’d likely click them and sign up. Referrals. It drives everything, no?
But what about “Google AdWords Ninjas” on LinkedIn?
They have their place. Tech can drive people to products and services, and some lifestyle brands I am sure slay targets on The Gram and all that. But as humans want human interaction — remember, the global economy is determined at parties you don’t get invited to — and tech floods every corner of our existence, wouldn’t you think the power of referral would only increase in coming years? And, paradoxically, shouldn’t AI-type programs eventually make referral processes and programs easier to execute? We’re moving towards a “Who’s Your Guy For _______?” Economy, eh?