In-Depth

Fishing for Compliments: How to Land Great Customer References

Partners and marketing experts answer five frequently asked questions about using a powerful piece of sales gear: the customer testimonial.

Ask anyone: Customer references are among the most valuable sales and marketing resources for businesses of just about every type and size. How valuable? "We've done mergers and acquisitions just to get the reference accounts," says Jeff Rudolph, president of ICS Advantage LLC, an Aurora, Ill.-based solution provider and Microsoft Gold Certified Partner.

References play an important role in the Microsoft Partner Program, too. You need at least three to qualify for a competency, and each reference earns you two qualifying points (up to a maximum of 20) toward Certified or Gold Certified status.

So it's no surprise that partners and marketing pros have a lot of practical (and sometimes contradictory) advice about how to get, use and manage customer references. Following are from-the-trenches answers to five frequently asked questions on the subject (also see "Reeling in Customer References" below).

Should I request a customer reference before or after we do a project?
Unless you've already worked successfully with the customer several times, wait until the engagement is over, recommends April Balsamo, marketing and alliances manager at Intrinsic Technologies LLC, an infrastructure solutions provider and Microsoft Gold Certified Partner headquartered in Lisle, Ill. "It's kind of premature, if a customer has never used you, to have them comment on how successful the engagement is going to be" before it even begins, Balsamo points out.

But Andrea Conway disagrees. The founder and CEO of Conway Marketing Associates Inc., a technology-industry communications firm based in Glendale, Colo., advises clients to include a requirement for customer references in the sales contract. That clause may be the first one your customer crosses out, but you can always ask for a concession in return -- and still request references later.

Conway, who includes client testimonials on her company's Web site, also recommends issuing a press release immediately after closing a deal, rather than waiting for results to report. Results may not be available for months, she notes, and almost anything from a buyout to bankruptcy can happen during that time.

The bottom line: The deeper your relationships with your customers, the sooner you should raise the reference issue with them.

Reeling in Customer References

Following are a few more tips from veterans of the reference game:

  • Aim high. When requesting a reference agreement, approach a senior leader, such as the CEO, COO or CIO, rather than a mid-level manager. Executives are more likely to welcome press exposure, and they’re usually powerful enough to overrule a skittish legal or communications department.
  • Stay current. Don’t use testimonials that are more than two years old, and be sure you’ve got up-to-date names, titles and contact information. Your prospects shouldn’t have to work to find the right person.
  • Monitor usage. Make sure you’re not bombarding your best client with several inquiries per week. Use references only with well-qualified prospects, spreading the reference work among several customers and be sure to track how often each is contacted.
  • Avoid anonymity. Anonymous references simply don’t carry the same weight as those using an executive’s name, title and company affiliation, says tech marketer Andrea Conway. While no-name testimonials may be the only option in industries where most players simply won’t comment publicly, she and others recommend attributing comments whenever possible.
  • Be flexible. There are lots of ways to use references. If a customer says no to a press release, consider inviting a company official to speak at a conference or user group meeting instead. Sharing experiences with peers in a less public setting may be more acceptable to them. -- R.F.

What if customers are reluctant to serve as references?
First, don't take the initial "no" for an answer. Try to pinpoint what's behind your customer's reluctance and then address it. Often, the underlying problem is a perception that being a reference is more effort than it's worth. In such cases, emphasize the benefits of participation, advises Sandy Bateh, vice president of Idea Integration Corp., a Jacksonville, Fla.-based solution provider and Microsoft Gold Certified Partner that focuses on the state and local government space. A press release celebrating the successful launch of an innovative solution, for example, can help your customers impress their own customers (not to mention their investors) -- as long as the statement doesn't read like a blatant vendor endorsement. A properly worded release describes a successful project implementation -- rather than merely plugging your own company -- an approach that's likely to enhance the clients' own public image as well.

"Even if you’ve used a reference many times before, always give a point person a quick call before mentioning the company to a potential customer -- and not just because doing so is courteous. That brief chat is also an opportunity to make sure your reference is still an advocate."

Should I compensate customers for serving as references?
That depends on how badly you need a reference, says Rufus Connell, a research director for information technology at Frost & Sullivan, a San Antonio, Texas-based marketing consultancy. New companies, with fewer success stories to tout, should offer discounts in exchange for reference agreements. "This should be a line item in the contract," he says.

More established firms, however, such as Serenic Corp. of Lakewood, Colo., often do just the opposite. Serenic, a solution provider and Microsoft Gold Certified Partner serving the government and not-for-profit sectors, reverses the price-cut equation. Chris Stevenson, vice president of sales and strategic alliances, says Serenic doesn't offer discounts in exchange for customer references. However, if a customer negotiates a price break for some other reason, Serenic requests a reference agreement in return.

What's the worst reference-related mistake you can make?
Failing to contact references before giving their names to prospects. Even if you've used a reference many times before, always give a point person a quick call before mentioning the company to a potential customer -- and not just because doing so is courteous. That brief chat is also an opportunity to make sure your reference is still an advocate. It's a lesson ICS Advantage's Rudolph learned the hard way. He once failed to check before directing a customer to a formerly reliable reference who, unbeknownst to him, had recently opened his own IT consulting business. The ex-reference "didn't say very good things about us," Rudolph recalls -- but was more than willing to tackle the customer's project himself.

Jeff Grell, senior vice president of consulting services at Lincolnshire, Ill.-based Junction Solutions, a Microsoft Gold Certified Partner that markets customized versions of Microsoft Axapta for the retail, food and beverage industries, spends an hour of prep time with references before a prospect calls them or tours their facility. If limited scalability, for example, is an especially sensitive topic for a particular customer, "make sure [references] are aware of that so they don't say things that can adversely affect the process," he suggests.

What are some best practices for managing reference information?
Be organized and methodical, says Balsamo, of Intrinsic Technologies, who e-mails customers a six-question survey after every engagement. "If the quotes are favorable, we then work with the customer to get a reference agreement," she says.

Balsamo also maintains a master list of customer references, broken out by industry and location. That list includes previously approved customer statements so that a sales rep can easily find an appropriate reference, copy the authorized text and paste it into a proposal. Maintaining the list also helps her spot references that have grown too long in the tooth. "You don't want a reference that's three years old," she says.

In the end, though, what's most important about references isn't how you track them but how you get them. The key to getting them, of course, is to keep your customers happy. Doing so often pays off, says Junction Solutions' Grell: "References flow from doing a good job for your customers."

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