Refer Business to Competition

Reading that headline you might think, “Gosh, has she gone nuts? Why would I want to refer business to my competition? Why would I deliberately want to lose a sale?”

But, I’m telling you, referring business to your companies competition, might actually be a good thing.  And like any “act of giving” it might come back to you manifold.

In my nutritional business I sometimes ran into customers who had an issue with the price of the flagship product of our company. They thought it was too high and told me that they could get the “same” thing for half the price at COSCO.

Perceived value versus price.

Since I often felt their objection most likely had more to do with perceived value than it did with the price, and since I was familiar with the product at COSCO I explained that our product was very different from theirs. I went on an explained the superior quality of our product and pointed out the extensive science behind it.

If all that didn’t help, I politely told them to go on and try COSCO’s product and if they didn’t see the results they wanted, I would be very happy to sell them ours.

Referring my (potential) customer to the competition showed…

1) That I cared more about satisfying their needs than making a quick sale.

2) That I had confidence in myself and in my product.

3) It was a polite way of saying (without actually saying it out loud), “If you want the cheaper, inferior product go there. And if it doesn’t bring you the desired results come back”.

You might be thinking, “well, did anyone ever come back and bought your product?” The answer is a resounding “YES!”  To this day, I still have former COSCO customers.

My husband does the same thing in his home mortgage business.

Sometimes he comes across clients who “shop around”. They think they can get a better rate elsewhere.

Randy is very knowledgeable. He knows what’s going on in the mortgage industry. He keeps a close watch on rates and knows when they go up or down. He is also very confident on what he can do for his clients and delivers great value on a continuous basis, (even after the loan is closed).

So if someone tells him, they can get a better deal elsewhere he knows if that’s true or not. And he will encourage his clients to go check it out and therefore refer business to his competition. After all, he only wants the best for his clients.

On numerous occasions clients came back to him after shopping around and even referred their friends and family to him after they closed on their loans.

Unfortunately it also happened that he lost some clients to what they thought was the better deal…But, they came back to him when it was time to refinance their home again.

So it pays to refer business to your competition. Don’t be worried that you would lose a sale, because more times than not you DON’T. On the contrary, you gain a loyal customer who knows that you provide value and that you care more about their needs than you care about yourself. And you also might gain some really great referrals.

To your success,

Ilka Flood
The Enlightened Networker

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