What are you focusing on to get NEW business? Leads v. Referrals

When it comes to GROWING your business, getting NEW business is very important.  As business owners we look for various ways to get leads or referrals, but leads and referrals are not the same, and should be treated very differently.  Here is the difference between the two, and which one you should be focusing on:

Leads

According to dictionary.com, a lead is a suggestion or piece of information that helps to direct or guide.  A business lead is a suggestion that this person or business may be a good potential for new business for you.  A lead does not come with a recommendation it is merely a suggestion that this company or person may have the services or products you are interested in.  Therefore, before a lead will turn into new business, he or she will need additional proof or a sense of trust to feel comfortable with giving the business to you.  A lead provided by  a third party usually includes the person/company’s name, number or e-mail address for someone who is possibly in the market for your service or product.

Referrals

According to dictionary.com, a referral is a person recommended to someone or something.  A referral results in more business than a lead because it is a recommendation.  When someone is interested in a product or service, they like to know if it is recommended, so if you come highly recommended by someone, you have a higher chance of getting that business.  A referral goes something like this, “Jane I would like you to meet John, John has a business with the services that you are in need of, I wanted to connect the two of you because I know that John does good work and I knew it would be a good connection for guys to meet”

The difference between a lead and a referral is really whether an introduction was made, and if the person was recommended.  If an introduction was not made and the person/company was not recommended, that is considered a lead.  If an introduction was made and the person was recommended, that is a referral.  Businesses close more business from referrals than leads, so what are you focused on getting?  Leads or Referrals?