Do your business referral sources only send you local clients who have very general needs or have you developed business referral sources that send you clients who are dispersed geographically and who have very specific needs? To help think about these questions, let's digress to consider the movie rental business for a minute.

Have you tried to find an old movie that you enjoyed? If so, you may have started your search by visiting a few of your local movie rental business. You probably discovered that these businesses only carry old movies that are popular among the masses and, unfortunately, the movie you want to see is not popular as you would have guessed.

the movie rental business standpoint, this makes sense. These businesses have a limited amount of shelf space. In the local market, there will probably be more consumers who would rent popular movies. This precludes these local businesses from carrying less popular movies.

This dynamic changes if the movie rental business makes its sales nationally using a warehouse for storage and the mail or the internet to rent the movies. These national businesses will have a much larger supply of shelf space (or warehouse space). They will also have access to more consumers. This larger population of consumers will probably include others who share your eccentric taste in movies. Thus, these businesses are able to carry less popular movies.

Indeed, national movie rental businesses may find that a majority of their business comes from renting these less popular movies. This phenomenon has been described using the term "long tail." For example, Chris Anderson applied the term to business strategy in his book entitled The Long Tail: Why the Future of Business is Selling Less of More.

As applied, the term describes the relationship between popular and less popular products. The idea is that the broader consumer base will include more consumers who want less popular products, and there may be more of these consumers than the few consumers who want more popular products.

Here is an example. With our local versus national movie rental businesses, assume the local business carries 100 movies that can be classified as being popular. Also assume that the national business carries an additional 10,000 movies that can be classified as being less popular movies. All things being equal, the national business will fare much better than the local business if both businesses rent 10 percent of their inventory. Of course, the national business will fare even better if clients like you are willing to pay more to rent rare movies to satisfy their eccentric movie tastes.

This business model helps to define the how a business referral network might operate. On the one hand, a business referral network may operate like the local movie rental business. It may provide your business with local clients who have very general needs and who are willing to pay regular business rates for these more popular goods and services. On the other hand, a business referral network may operate like the national movie rental business. It may provide your business with clients who are dispersed geographically, who have very specific needs, and who are willing to pay higher rates for these goods and services.

This concept is at the heart of the value that Passitto provides to its users. Passitto can help you expand your business referral network and do so in a way that fits with your particular business model.

Unlike other referral systems, Passitto can operate as the local or national movie rental business or both - depending on what is best for your specific business. Using Passitto you are able to make this type of decision on a case-by-case basis by bidding or not bidding on individual referrals. You might only bid on referrals placed in your local market for very general goods or services or you might bid on referrals placed nationwide for very specific goods and services.

In the past, many businesses were not able to make this type of decision without making drastic changes to their business referral networks. These efforts required quite a bit of time and energy. Now, with Passitto, businesses can retool their business referral networks on the fly. This presents Passitto users with a unique advantage over other businesses that have yet to discover and take advantage of Passitto.

Labels: business, leads, Long Tail, passitto, referral, sources

Though the terms "business lead" and "business referral" are often used interchangeably, the two terms describe two separate business concepts. As it turns out, a lead is not a referral, but a referral can be a lead. This may sound like a riddle, but it is not. Let me explain.

A business lead is simply a hint or tip about a potential client or sale. With a lead, there is no connection or relationship between the lead and the person who acquires the lead. Leads are impersonal. Following up on leads requires a significant amount of energy in screening, qualifying, and closing the sale. In this sense, a lead is barely better than an uninvited call, visit, or mailing.

A business referral is more akin to a strong lead that is often accompanied by a recommendation from the referrer. Referrals are strong leads because they have already been screened and qualified by the person making the referral. This works because persons making a referral often have knowledge that makes them better able to judge the needs of the potential client and the products and services offered by third parties. Think of a real estate agent who is able to recommend an appropriate mortgage broker or a personal injury attorney who is able to recommend a specialist tax attorney.

Referrals are also considered to be strong leads because of the time in which they are made. Unlike regular leads, a referral is most often made at a time when the potential client is in need of a specific product or service. Referrals are fresh, live, and now. For example, a stock broker may refer a potential client to a Realtor, wedding planner, or other third party when the prospective client cashes out their investment accounts. The stock broker will do this at the time that the potential client has the money to spend and has indicated a need for a specific product or service.

Leads are particularly strong when the referrer tells the potential client to expect to hear from the third party. In these cases, much of the sales process will have already been completed before the third party even contacts the potential client. The potential client will be receptive to being contacted and, due to the anticipation of being contacted, be more apt to purchase the product or service.

Unlike mere leads, business referrals often involve recommendations. The recommendation may include a personal introduction of a third party or allowing the third party to mention the referrers name to the referral. These recommendations allow the referral to feel more comfortable with the third party. At this point, the referral is more akin to a closed sale. Indeed, in many cases the third party only needs to provide the product or service and collect their fee from the client.

There are quite a few websites and services that use the term "referral;" however, upon closer inspection, most of these websites and services are more aptly described by the term "lead." By applying this more precise term, it is easier to see the value of a website like Passitto.com. Passitto was designed to incorporate the benefits of referrals, as defined as strong leads plus recommendations.

With that said, let's test your knowledge. If I said "Passitto.com is the best source for you to obtain business referrals," would I be providing you, as the third party, with a lead or a referral? Of course, the answer is that I would be providing you with a lead to the best source of business referrals. If this is confusing, you might just sign up for Passitto and give it a try.

Labels: business, difference, leads, networking, referrals, sale

It's been a while since my last post. We've been busy here at Passitto adding some new features you will find useful.

Import your LinkedIn profile!

We are happy to announce our integration with LinkedIn. In just a few easy steps you can import your entire LinkedIn profile into Passitto. You will also notice we have added LinkedIn's Company Insider widget to member profiles. This will allow you to see how you are connected with various companies listed on the site.

Passitto is also integrated with Facebook, so if you don't have a LinkedIn account, but you do have a Facebook account, you can still import your profile.

Group Calendar and Events

Another new feature of Passitto is the calendar and events system. All groups now have access to this feature. You can easily create events for your group, see who is planning to attend, post messages regarding the event, as well as have the event location mapped using Google Maps. Remember, creating your own group on Passitto is quick, easy and 100% free. You can create a virtual extension of your existing leads, networking or industry group, as well as form a completely new group.

We invite you to check out all the new features!

Jeremy Bamford, CEO
Passitto.com

Labels: API, calendar, exchange, Facebook, group, leads, linkedin, passitto, referral, referrals

© Copyright 2008 - Business Connect, LLC
Patent Pending