The Power Of Referrals – One Client = $4.7 Million

Power of ReferralsThe building and construction industry have a deep understanding of how important it is to treat your client right. When you do, there’s no issue asking for a referral. In some cases, the request yields unpredictable and seemingly miraculous results.

Mapping the reach of referrals


When Lori Bryan, vice president and COO of Marrokal Design & Remodeling, in San Diego, created a chart to show the reach of a specific client, she was surprised to find that $4.7 million worth of work over 12 years had resulted from a $100,000 project. The first clients, the Smiths (all client names have been changed for this article), heard about Marrokal from a radio ad. “No matter how much it cost for radio that year, it paid off!” Bryan says. That original job led to two other raving-fan clients who referred much of the additional work. Johnson referred the company 15 times, with six of those leads turning into jobs; Jackson referred Marrokal 12 times, with seven turning into jobs. “There are some key past clients who really are ambassadors for your company,” Bryan says.

Get to the Source

This chart shows that referrals are the strongest, most cost-effective of all the company’s lead sources. “Good clients generally refer good people,” Bryan points out. Such a chart also illustrates to staff — especially the field crew — the significance of providing great customer service for every client. “It’s important for production to understand what kind of role they play,” Bryan says. Creating a chart like this is a good exercise for any remodeling company. Bryan’s tips: Use a good lead-tracking system, so you know the source of each referral. Start with a client who has provided multiple referrals, so you have a larger network to review. Include information about project type and budget. Bryan’s original 2008 version of the chart didn’t include this information, but having it on the chart can help you spot trends. —Nina Patel

Cleint Referrals Chart


Click here to download a PDF of this chart