Why most businesses struggle growing past a certain point
Most businesses struggle in growing past a certain level for 2 major reasons. They rely solely on generating new business from the people within their organization or rely too heavily on outbound forms of marketing (billboards, online advertising, etc.). Needless to say, they rely on expensive forms of growth.
Example of a company struggling to grow
Let’s use an example company, “Mike’s Web Design Company.”
Mike’s Web Design Company makes awesome websites and has been in business for over 10 years. For the past 5, Mike has grown his web design business by hiring one sales person. Although the business has been growing in revenue, Mike wants to speed up revenue growth so he can invest in hiring 3 new people to take care of building the websites, and a little because Mike wants to play golf every now and then :). This move will allow Mike the opportunity to expand his revenue potential to $1 million in revenue per year.
Mike knows that his sales person has brought in $100,000 each each year, but this isn’t quite enough to make Mike comfortable in hiring new people. Mike needs to bring in $300,000 in revenue each year to comfortably make the move.
So what is Mike to do? In some sense, just about every kind of business goes through this phase at some point in its life cycle.
Overcoming the challenge of expensive forms of business growth
Ultimately, Mike needs to setup his marketing channels to drive in quality leads for his salesperson to close. The reason why his sales person has struggled in closing more than $100,000 in business is because he spends most of his time prospecting and qualifying than actually closing deals. What if the sales person could completely cut out any need for prospecting and/or dramatically decrease the amount of time they spend qualifying each new client?
Where a purpose-driven private social network for referral sources fits in
One major way for Mike’s salesperson to overcome this challenge is by putting an extreme level of focus on engaging their referral sources. I’m not just talking about sending them a thank you card or an email newsletter, I’m talking about building a strong sense of connectedness with each referral source through a private social network (i.e. Social HubSite) built just for referral sources.
For Mike’s web design business, he could create groups for different types of referral sources. In this case, the groups might be Marketing Consultants, Search Engine Optimization Firms (that don’t handle web design projects), Accountants (for new businesses), Attorney’s (for new businesses), Printers and even Current Clients. The possibilities in referral sources are endless. Ultimately the engagement with these different groups of referral sources will be different. For instance, when Mike shares the latest project they worked on with Accountants, he will want to make sure to stay away from using tech jargon. I think you get the idea.
Within this private social network for referral sources, Mike might also want to share documents related to the grouping of referral sources. Maybe marketing sheets that printers can hand to clients.
Maybe an article that attorneys can hand to new business startups on a guide to building their first website. Again, the possibilities are endless here.
Lastly, Mike might also want to add a web form in the community for their referral sources to submit information for the new referral so he can formalize and better organize how referrals are accepted.
Make referrals a planned event
By creating this level of systemization for referral sources, Mike will have a much greater chance of generating more qualified referrals and cutting down any unnecessary time for his sales person so they can just concentrate on closing. Because of the flexibility Mike has in branding his private social network, his referral sources understand it’s purpose and feel more connected to his brand, thus keeping him in their conscious thoughts more often and generating more referrals.
Turn your clients and referral sources into your un-paid sales force
As I always say, you need 4 components to work together in harmony in order to create a business that works: Purpose, People, Platforms and Processes. The moral of this story is to consider using Platforms to create environments to empower the right People through Processes that help to achieve your Purpose (mission, vision, goals, etc.). Before Mike only used People to grow his business and it didn’t help him achieve his Purpose. Once Mike setup the Platform and the Processes around the Platform to engage the right People, he worked toward achieving his Purpose. His referral sources and even own clients did the prospecting and qualifying thus allowing Mike to scale his business profitably.
Get started now
So the next time you think about ways to increase revenue and expand your business, think about setting up a private social network (Social HubSite) for your referral sources. Consider using Social HubSite as a platform to make it happen the right way. We are dedicated to not only providing you with the Platform to make it happen, but also the right level of support and education to make the Process behind it work for you.