They are also good for business because they have a rapid rate of acceptance, which is dramatically accelerated because the service or product has already been tried and tested by a reputable third party.

I have heard of a number of instances where people have never forgotten a company or an individual because of positive dealings they have had with them. Perhaps they were given a referral which produced business and, as a result, said thanks with a simple card, a bottle of wine or chocolates, or even a referral fee. It is to this end that a referral gifts do two things: thanking someone for the business you have already given them and thanking you for the business they are about to give.

The power of remembrance and loyalty created by this sort of attitude has long-lasting implications. People don't forget when others have gone out of their way to show their appreciation by making a special effort to thank them sincerely. It is, therefore, possible to build a business entirely on referrals, providing the right network is in place.

New business obtained on the recommendation of other people is also highly profitable as there is no marketing or cold calling selling attached. Yet, despite these benefits, few companies actively seek referrals.

Referrals are the rewards that come once you have created your business network, made your connections and built your relationships. They are the ripe fruit that you have worked hard to grow. Like a harvest, they only appear if the conditions are favourable and richly deserved.

Don't be afraid to ask for business referrals for a job well done. Asking for a referral is one of the most powerful and low cost ways of building or developing your business. It is a simple approach that feeds on its own success, but it has to be built on secure foundations.

So when should you ask for business referrals?

• You've introduced someone to one of your contacts who awards them a project
• You have successfully completed at least two transactions for a client
• You have successfully solved a problem for a client who is interested in reciprocating in some way
• When a client says thank you for a good service
• When you've helped a client through a particular difficulty

Referral marketing provides a very cost effective method of maintaining a healthy customer base of individuals and organisations that are pre-sold on purchasing your particular products or services. The technique relies heavily on customer service, which is essential to the success of absolutely any business. Referral marketing can help you replace any customers who will inevitably begin to lose interest, move away or switch to one of your competitors.

If you create a referral marketing campaign that is personalised and focused on establishing solid customer relationships, you will more often than not see immediate positive results with an increase in business.