Book Review: The Referral Engine – Take aways for financial marketers

Posted by Luke Owen on Thu, May 13, 2010

John Jantsch is the perfect example of someone who practices what he preaches. About a month ago I stumbled upon an offer to receive a free copy of his new book, The Referral Engine, if I agreed to write a review at some point during the week of May 10th. I don’t remember the exact source – Twitter, Email, Blog, etc. – but this is just one of many referral techniques that he highlights in this book.

John is the founder of Duct Tape Marketing, a marketing consulting practice that has certified consultants throughout the country. You may even have a Duct Tape Marketer in your back yard. The concepts that John talks about both with his Duct Tape and author hat on are not mind blowing or revolutionary (that is, if you’re hip to the new rules of marketing and PR). By now I think we can all agree that the Internet, just like the TV, has changed the game of marketing for a long time to come. Instead of talking to our customers, we now have to listen and make them an integral part of how we craft our communications and even develop our products. John lays out in this book that the age of the 4 Ps – Product, Pricing, Place, and Promote – is no longer viable and has given way to the age of the customer. In this new age, we now have the 4 Cs – Content, Context, Connection and Community.

A resonating theme throughout the book is the concept of education. There’s an entire chapter dedicated to the development of content. The goal of this content is to educate your clients and prospects. Oftentimes this content will include tips on how someone might go about creating their own solution just like the one you have to offer. In the case of a banker or financial professional, this might be content that explains the home buying process – from placing a bid to hiring a lawyer - or perhaps the best types of investments to make when you’re in your thirties and have a particular amount of savings available.

How this content is delivered takes on several forms and John does a great job of outlining the many different approaches. As John states, “An educated customer will always be a better customer.”

But perhaps just as important as educating our clients, we must ensure that our own employees are educated as well. Educated on the status of the company, educated on the type of clients “we” work with, educated on their role and how it plays an integral part of marketing – whether you’re in the IT department or in sales. In fact, John goes on to state that the sales departmet is perhaps the most important part of your marketing team. It’s often during the sales process that determines the future of your customer relationships. If they had a good experience during this process, the chances of them becoming a source of referrals is much higher then if they received poor service. You may be saying, “Well, if they received poor service, why did they buy from us?” Why people buy is not often about customer friendly service. Sometimes it’s about convenience (i.e. you may be the closest bank to them) or about pricing (i.e. you have the best rates). If this is the only reason you’re winning accounts today, chances are you’re not receiving many referrals from your customer-base.

Hands down, this book is well worth the read for the ideas and references alone. John isn’t just a talker, he’s a doer and he helps show you that by “doing” the steps talked about in this book, you’ll be rewarded with more referrals and more business then you can handle. For example, the second to last chapter, “Snack-sized Suggestions”, takes a look at three different professional categories – Retail, Service Business, Independent Professionals. Real-life examples of how to implement the ideas brought about in this book are shared for each category. Here’s one of my favorites from someone in insurance sales:

This insurance agent turned his business-owner clients into stars. He interviewed some of his highest-profile clients on what it took to be successful in business. He recorded these interviews and eventually turned them into a very useful business-building library. Then he sought out potential interview guests to include in the series. These business owners didn’t see him as an insurance salesperson; they say him as a member of the media who had the ability to offer their business lots of free publicity. But, eventually, many of these featured businesses bought insurance from him and, in all cases, they promoted his business when they gave away or sold the library of interviews.

So, are you ready to let go of those traditional marketing models? Are you ready to dive head first into this new approach? If you ask some of the worlds best sales representatives, they’ll let you in on a little secret – none of this is new - it’s just new to most marketing departments.