Post by Lee W. Frederiksen, Ph.D., Managing Partner at Hinge

You’d never build a marketing strategy around happy accidents or wishful thinking, yet many professional services firms have no other plan in place for winning referrals. Sure, quality work and solid relationships might pay off in organic referrals. But the truth is that referrals must be cultivated.

A new study from the Hinge Research Institute involving 523 professional services firms reveals that referrals come about very differently than you might suspect—and that having a strong brand is a powerful driver of these connections.

Non-Client Referrals

Networking never hurts, but not all referrals are based on working relationships. In fact, the research shows that more than 80% of buyers have received referrals from colleagues who have no prior experience or relationship with the service provider. They break out into two categories:

  • Expertise-based referrals. These referrals are the result of industry awareness of your specialized abilities, technology, or staff. When expertise is needed that falls into your arena, you come to mind.
  • Reputation-based referrals. These are similar to expertise-based referrals, but they’re not built around a specialty, so much as an overall positive awareness of your firm’s place in your industry and your commitment to quality.

Besides coming from non-clients, what do these types of referrals have in common?

hinge fig 1

Both are driven by marketing, and both are the result of having a powerful brand. Of these brand-driven referrals, 46.4% are reputation-based and 48.1% are expertise-based. Only 5.5% of non-client referrals are the result of networking events.

Where Referrals Come From

Expertise-based referrals come from exposure to your ideas and online content. hinge fig 2

More than 50% of these referrals come from online sources: blogs, reviews, searches, and the service provider’s own website. In short, they’re the result of content marketing.

Providing quality online content, optimizing for search results, building a lead-generating website: these referral-driving elements are the same ones firms use to establish and promote their brands.

All things considered, it’s time to expand the definition of referrals to include those based on the footprint of your brand. We define a firm’s brand as brand = reputation x visibility. And as referrals have always been largely dependent on reputation, it makes sense that increasing visibility will drive referrals. Why depend on clients when you can expand your reach well beyond the reach of your current clients?

This isn’t to say that you shouldn’t continue to provide quality work—and gaining referrals from past and current clients, partners, and colleagues should continue to play a part in your referral marketing strategy. But these traditional means aren’t the only means of driving new business through referrals.

Take a thorough look at the current state of your referrals and then determine ways to demonstrate your expertise and build visibility. If you need help getting started, or just want more background on the research we’ve discussed, download Hinge’s Rethinking Referral Marketing Guide for free.

About the Author:

Lee W. Frederiksen, Ph.D., is Managing Partner at Hinge, a marketing firm that specializes in branding and marketing for professional services. Hinge is a leader in rebranding firms to help them grow faster and maximize value.