Building a Referral Network With Strategic Partners

0:00John Jantsch:So most people build referral networks by meeting, I don't know, as many people as they can, as many people as possible. Today's guest picked five or so and went all in on the trust with each one of them and turned it into a$50 million in funded deals without any cold calling.

0:25John Jantsch:Hello and welcome to another episode of the Duct Tape Marketing Podcast. This is John Jance and my guest today is Jermaine Cheatham. He is the sales director at Deo Financial Solutions and runs something called Creators Learn, where he teaches other sales professionals how to build the same kind of referral-based business. Today, he actually pitched me on the idea of building something live here on the show, so I have no idea what I'm doing today. We're just going to dive right in and see if he can actually use a duct tape marketing offering as a set of case studies. So Jermaine, welcome to the show.

1:01Thanks, John. I'm looking forward to it, man. I'm just as lost as you in today's episode, so we'll figure it out on time.

1:07John Jantsch:Let's get a little context. In the email you originally sent me, you said you'd been making 300 cold calls a day, which sounds absolutely terrible, and that nothing was really working. So what was the day you realized that math would never kind of get you to where you wanted to go? Well, I realized it because I was working 12 hours a day and getting very little results from it. Life is short. We all die. So I knew that was not going to pan out long term. And the way I had the epiphany was I was talking to one of the people that were working on the deal that we were working on together. And he told me, hey, Jermaine, I'll have some more deals for you.

1:48and I realized, oh wait, I've been going at this the entire wrong way. Instead of me going one-to-one transactions and trying to figure out one-to-one how I can get someone to buy my thing, I should just partner with people that already have my ideal customers in their sphere of influence. And my thing helps them sell their thing. And because I was doing financial services, I just partnered with medical device salespeople because my financing helped them sell the medical devices for the doctors. So it became a win-win-win situation where I did 90 % less work, but got 90 % more income. So I just turned the entire vehicle on its head.

2:28Yeah.

2:29John Jantsch:I wrote a book actually called The Referral Engine in 2010. And that was one of the premises of that book was your customers, people who know you, I mean, certainly know how great you are. They can refer you, but they can refer one or two people maybe. Whereas like you said, that right strategic partner might have 500 people that can send your way. So 100 % agree with that. So one of the things I want to focus on is that I think that you said most of your results came from just a small group of people, five maybe. How did you pick those instead of the, you know, obviously the others, the hundreds you could chase?

3:04John Jantsch:Well, because they started sending me business. And so there's no reason to chase more business if you have ample business already. It's all about quality, never quantity. I'm always looking for leverage and simplicity. And so for me, leverage and simplicity is always about how can I manage the fewest personalities, procedures, protocols, and get the greatest return while deepening my relationship with those individuals? Because you can't have a hundred friends. you can't be close enough because there's not enough hours in the day. So you have to really dive deep into who do you want to spend your time with and develop something bigger as long as it's profitable.

3:43I always have this adage like the best friends to have are friends you make money with.

3:49John Jantsch:Yeah. Well, and that's a really good point though. I mean, I know you're kind of being facetious, but not, is that those five or whoever, whatever the number is, they have the right values. They bring you the right kinds of customers. A deal is easy with them. I mean, it just, you know, it's like there's a whole bunch of people out there that can make life hard. You know, when you find people that can make life easy, then like you said, why not focus on deepening that relationship? Yeah, it never makes sense to me to chase anything in life. Because you'll notice like the best friendships, the best relationships, the best business partners, they were always very easy at the very beginning.

4:26It was never a bunch of convincing or scratching and clawing or following up. Even to me, following up is almost a waste of time, to be completely honest. Because you'll spend 90 % of your day following up with people that will never buy from you versus just pay attention to the signals that are already there that are easy. Yeah, yeah.

4:47John Jantsch:So we provide fractional CMO services, as I told you. And actually, we have a whole network of certified marketing consultants that license our practice. So I thought you had offered to kind of do this live, break this thing down live. And so I thought, let's use the duct tape marketing fractional CMO service as kind of the guinea pig for this. We provide this service to really small to mid-sized businesses. We're not going after Fortune 500 companies. These are like$2 to$20 million businesses, founder-led quite often. And what we're providing them is marketing strategy, marketing leadership, which they haven't had.

5:26John Jantsch:In many cases, we will also execute on the plan for them with our team. But the primary thing that we're bringing to them is a strategic outlook on their market. So what other context would help you kind of do today's goal? So is there any particular vertical you're in? You know, we don't, we haven't. I just, I've always enjoyed the variety of working with different types of businesses. We do a lot of business in the home services industries, you know, remodeling contractors, roofing contractors, that kind of thing. And we do a lot of work in the professional services. So other consultants, you know, architects, accountants, lawyers, those are probably the two biggest, very broad, you know, markets, but home services and professional services.

6:15And so which is the most profitable and which do you enjoy working with the most?

6:22John Jantsch:Well, you know, my team does all the work, so I couldn't tell you the, I couldn't tell you this, but you know, they're drastically different. I think the reason we went into those two fields is professional services have always relied very much on thought leadership. And that's really how I built my whole practice was on thought leadership. But then I started moving a lot of that thought leadership towards businesses like remodeling contractors who were like, what do you mean thought leadership? We just build this thing that people tell us to, but we've actually been very successful at almost changing that industry by having them think differently about it.

7:00John Jantsch:So if I were going to pick, you know, my, one of my favorites is remodeling contractors. You know, I just, I love working with them. We can have great impact, you know, especially ones that we can teach some of the, you know, the differences that what we bring and what strategy really means. We can have massive impact on their business, really transform their business. Okay. And so we'll just take those two avatars. Okay. So with the contractors and with the professional services folks, how do you currently acquire those clients? Well, I've been doing this 30 years. I've written seven books on marketing.

7:36John Jantsch:And so we have a little unfair advantage. I shouldn't say it's unfair. I mean, we work to build it. But most of that comes to us by way of the fact that we have a pretty well-known brand nationally. Got it. So it's mostly all inbound, I'm assuming. It really is. Yeah. Okay. Is it mostly from the books or what's the main driver? Well, we've continued to, you know, we do webinars every month. We put out tons and tons of content. We're very active in the social channels. So it's the books are a big part of, I would say, half the business that finds us sites having read or at least been aware of one of my books.

8:15Got it. Okay. Interesting. Okay. so here's the problem I see with the current setup but I know why you set it up this way being broad but strategic partners always work the best when we have a very narrow offering and avatar obviously so with that being said what I would do on the contractor side is I would probably partner with franchisors that do those type of franchises because it doesn't, they have to have a ROI. They have to have these franchises work. And so what's the biggest hindrance of growing a franchise? Marketing and sales and getting more revenue, right? So I would include some type of marketing package that you already have included in the franchisor's pitch to the franchisee.

9:12Right. that would be an easy... Now, obviously, you'd want to even get more niche as far as they only do bathrooms. They only do kitchens. The more niche, the better for the real leverages. But that would be what my first thought with the remodeling situation would be. Partner with the franchise boards. Now, on the professional services, what I would probably do, since it's, again, very broad, and we don't know what these coaches or consultants are actually doing, but they all, since they're thinking about thought leadership, most of them I've noticed really place a very high value on branding.

9:49Sure. And believe brand is like the bee's knees, but real entrepreneurs know branding comes after sales and market. It becomes almost a byproduct, but they don't know that. So I would partner with brand consultants, brand coaches, whatever, offer your package. Say your package is$10 ,000. You give it to the brand consultant or coach and say, listen, this is what I do, X, Y, and Z,$10 ,000. However, you can offer it to your clients for whatever you want to price it. You can price it at 20. You keep the spread. We make our 10, you make your 10, whatever. But that not only makes the branding person's offer stronger, but it also is going to exponentially help their client actually execute on the brand.

10:34So everybody wins in that scenario. And also everybody wins in the franchisee scenario. So those are my two high level of thoughts on this live kind of workshop. You know, if we had like more narrow specifics, I could have a lot more leverage. Like, for example, I had a client that was doing high-end gourmet chocolates in Dubai. She couldn't figure out how to sell. And so since I knew where her market was and all the situations, I was like, your best strategic partner is going to be the top 50 restaurants in Dubai, the top high-end 50 restaurants in Dubai. And you can either do this wholesale or retail, but you give them the chocolates for free.

11:13Everybody loves an awesome surprise at the end of their meal, especially when they're high-end, they're wrapped in this beautiful box. So you can either give them to them for free, obviously. Once they get ingrained and they get their response back from their clients how much they love these chocolates after their meal, after they spend$1 ,000 on lunch, then you can either decide, I can do wholesale and sell these chocolates to the restaurants for 50 bucks each, whatever you decide on the pricing, or even better, retail, where you include your business cards at the bottom of the box, your Instagram handle at the bottom of the box.

11:47So then these people that make millions of dollars can reach out to you directly, tell their friends and family about you, and then you have a direct-to-consumer play. But again, you're just using strategic partners who are these high-end restaurants to get your foot in the door to these high-net-worth individuals who want to buy your chocolates versus trying to figure out how to do it one-to-one on your own. Yeah.

12:08John Jantsch:So I kind of set you up a little bit in that we've been doing this, you know, we've been doing strategic partners for 15, 20 years. And so like on the remodeling side or the home services side, every trade has an industry group and every industry group has a local chapter. And those have been, so because we can educate on marketing, which is frankly a topic they all are always interested in. We do a ton of education in those associations and those trade groups. And that puts us, that has them effectively put us in front of their audience. On the professional services side, we've had a lot of luck with all the MarTech software solution folks.

12:48John Jantsch:You know, people like HubSpot put us in front of their audiences because they know that their folks need strategic marketing and, you know, not just a tool. And so we've had a lot of luck in those two, both of those areas. probably account for about half of our business in any given year is the fact that we have people put us in front of their audiences. So they're not pitching anything or we don't even set up referral relationships with them. We just provide value to their users or their clients and some of those folks decide to hire us. Yeah, no, that's the only way to do it. But it becomes even more strong when you can figure out from a strategic lens of how you can make sure that your thing helps your partner sell their thing.

13:38John Jantsch:Because that's not a one need. I have to have the main thing to sell my thing. That's when those relationships last for a lifetime. And the deal just becomes super simple because your partner's doing all the selling on your behalf because they need your thing to sell there. That's right. That's right. Well, they, and I think that's a really key, especially when you're trying to develop an initial relationship. I mean, let's face it, you know, people are going to consider, well, what's in it for me? And so I think you're absolutely right on that. You know, I get pitched every day with people that they call it partnering, but what they really want is for me to sell their stuff.

14:15John Jantsch:And, you know, it really, that idea of providing value first in some fashion, you know, you hit on it and just like, it helps me, it helps them sell their thing. Absolutely. A hundred percent key. Yeah. And then, and this is just kind of something I learned in my finance space. And then I started to realize like, okay, as I'm getting into coaching and consulting, like how am I going to find people to coach and consult? Like I learned my lesson. So like, it's all about finding these partners that need your thing to help them sell their thing. And if more entrepreneurs can think from that lens, it makes life not only easier, but it's actually funner because you're doing business with people you like and everybody's winning.

14:55So it's not like a competition or winners and losers. It's like we're going in the same direction.

15:01John Jantsch:So if you were going to, again, you obviously would have a lot more context than this, but you know, there's a ton of people out there. I mean, again, I talked about getting pit. I mean, I tell you the thing I get pitched more than sell my stuff is people that want to generate leads for me by sending out cold, you know, cold email or whatever. So, and a lot of people are falling, you know, for that. If you were talking to somebody, somebody came to you as a prospect and said, oh, we're doing this cold outreach and we get one or 2 % response and it seems to be going okay. What would you tell them?

15:30What's kind of one move you would say, here's what you need to do to find your first real part?

15:35John Jantsch:Well, first, stop doing anything cold. Like cold email, cold call, cold ads. It's like, it doesn't, I mean, it works, but the ROI on your time, your resources, your money, it's like, it doesn't make sense. It's also abusive to both parties, yourself and the person you're sending it to. Yeah. I think there's somewhat, I think there's been over the last, I don't know when this developed, but there's a misconception on how the human psychology works when it comes to sales. People want to put sales or marketing in one box and then put the rest of their life into another box as if it doesn't bleed through.

16:15No. Sales and marketing in your normal life are the same. Your wife, your friends, everyone you interact with, you know them because they know, like, and trust you from some situation that you infiltrated and became known at church, in the soccer club, in whatever, your local baseball team. whatever it might be, you became part of a community, if you will. That is the only thing that matters in sales and marketing is once you're part of some community where everyone is winning based on your thing, then you don't have to sell market or brand because they send you ready to sign clients that you don't have to convince because they trust Tim and Tim trusts Jermaine.

16:59So now they inherently trust Jermaine. It's just human nature. It's not rocket science. So the first thing I would do is say, stop anything cold. Second thing to do is, everyone has a Rolodex of friends, family, previous coworkers, anybody. I don't care if it's 50 people, a thousand people, whatever. Reach out to every single one of those folks. I would hope on a phone call, that'd probably be the best. You could always message me. And to say, I'm looking to get into, this is exactly what I do. When I first started in the finance space and I was struggling because of all the cold calls, I reached out to my Rolodex and one lady I talked to, she was in marketing.

17:36And I said, I'm looking to get into the healthcare field. Do you know anybody? That's all I said. She said, great, let's have lunch. Went to meet her for lunch and gave me a couple of names. I called those names. I said, name dropped her name, like who she referred me. Next thing you know, I'm getting deals from these folks because I'm leveraging the network that's already in my phone. So first thing, call everybody or contact everybody in your phone currently or on your LinkedIn or whatever that knows you and say, I'm looking to get into this industry or find people here, whatever. So we start giving you names.

18:09We're going to start introducing because humans want to help other people. We love to help other people. It's inherent. So that's step two is contact everybody on your phone and then reach out to those folks and tell them what you're trying to do. And then that is the first step. You'd be surprised how much comes from that first domino because then they start referring you to five, six other people. And then once you have like a one key, I call them MVPs, most valuable partners. Once you have one MVP that's sending you business, that's solid, that you like, you're as a friend, everyone's winning, that one MVP goes over people that probably has the same service or product that you could also distribute to that community.

18:49So it becomes a snowball, a domino. you can have different analogies for it, but people forget to leverage their backyard. Like if I live in Phoenix, why am I calling someone in Texas? I should exhaust Phoenix metro area first before I go anywhere because it's just no like and trust. You can talk about common things, the weather, the sports teams, whatever. So we get, I think a lot of folks look at, you know, gurus are successful people and they see them in their 10th chapter and they're trying to copy the 10th chapter where they're in the first sentence of the first book.

19:22John Jantsch:You know, I think that point about reaching out to everybody on your phone, I make that all the time because maybe two of them are prospects, but they all know somebody who needs what you do. And I think your point of just letting it out there wide open, do you know anyone who, you know, is one of the best, you know, best opening phrases you can make, you know, to your warm market for sure. Exactly. Yeah. It's simple, man. But simple is not always executed on for some reason. Well, there's the lure of, oh, I can send a thousand emails with the click of a button. That seems a lot easier, right?

19:59John Jantsch:But do less, but just do it better as opposed to trying to spam everyone. Well, Jermaine, I appreciate you reaching out to me and agreeing to kind of do this fun little episode today. Is there someplace you'd have people connect with you or find out about your work? Yeah, best place is at my website, creatorslearn.com. They can check out all my socials and then they can also book a call there too with me directly. Awesome. Well, again, I appreciate you taking a moment to stop by and hopefully we'll run into you one of these days out there on the road. Sounds good, John. Appreciate it, man.