Podcast Summary: Roadmap to Referrals

Episode 381: Referrals and ROI

Host: Stacey Brown Randall
Release Date: September 30, 2025

Episode Overview

In this episode, Stacey Brown Randall explores how to truly assess the return on investment (ROI) of referrals in your business. Moving beyond the usual "money in, money out" calculation, Stacey encourages listeners to consider time savings, client quality, and conversion speed as overlooked but critical components of ROI. The discussion is anchored around the importance of planning for Q4 and the value of implementing a multifaceted referral strategy.

Key Discussion Points & Insights

1. Rethinking ROI Beyond Dollars

• Stacey begins by questioning how listeners typically assess ROI, particularly for sales, marketing, and referral activities.
  • "Do you calculate ROI, or return on investment, in your business specifically?" [00:18]
• She points out that ROI is usually viewed through a revenue lens, but urges listeners to consider other returns: time, effort, and business efficiencies.
  • "Money earned is not the only way to calculate an ROI of any type of investment you're going to make." [01:53]

2. Q4 Planning and the Referral Conversation

• Stacey highlights the seasonal influx of business-planning messages and admits to sending similar reminders herself.
  • "When we start, like, we click over to October 1st, it's like, boom, fourth quarter's here, start planning, start prepping." [03:06]
• She stresses the importance of reflecting specifically on the ROI of referral-generating activities as part of Q4 and annual reviews.

3. The "Back of the Napkin" ROI Approach

• Stacey describes how she typically helps potential clients assess the value of joining her programs by comparing the investment to expected referral-generated revenue.
  • "We map that out based on what the average client makes. And then if we… double, tripled or quadrupled your referrals and how many of those you closed…" [04:17]
• However, she believes the real story of ROI is much deeper than simple financial calculations.

4. Unique ROI Advantages of Referrals

• Stacey cites key industry stats:
  • 83% of people prefer to make buying decisions based on referrals.
  • Referrals have a 70% higher conversion rate.
  • "I think those stats really start to help us understand and have a more complete story of the ROI on referrals." [06:28]
• She emphasizes that referred prospects tend to close quicker, saving time and resources.
• Calculating the time-to-close for referred vs. non-referred clients is complex but significantly affects the real ROI.

5. The Hard-to-Measure But Crucial Non-Monetary Gains

• It can be difficult to assign a dollar value to time saved, reduction in effort, and improved client fit that comes from a strategic referral system.
• Stacey is candid about not being a data scientist but reiterates that "referred prospects are quicker and easier to close." [08:11]
• The process, she notes, must factor in your own observations and data across multiple referrals for statistical validity.

6. The Multi-Layered ROI of Referral Strategies

• Client quality often increases over time with a refined referral process.
• The host suggests tracking these additional metrics:
  • Time to convert a referred client
  • Quality and profitability of referred business
  • Time saved on networking when an effective system is in place
• These considerations make a strong case for investing in a referral strategy, not only for immediate revenue but for business sustainability and growth.

7. Case Study Reference

• Stacey refers to episode 333, featuring a BRB (Building a Referable Business™) client whose most valuable ROI from referrals was time saved.
  • "For her, it was more important that she knew what to do. So it saved her time." [13:15]

8. Action Steps: Assessing Your Referral ROI

• As Q4 approaches, Stacey urges listeners to:
  • Reflect on both the revenue and the "softer" metrics of ROI.
  • Track improvements in conversion times, client quality, and business efficiency connected to referral strategies.
  • Not reduce the ROI conversation to simple financial returns but to acknowledge time saved, stress reduced, and client betterment.

Notable Quotes & Memorable Moments

• "Money earned is not the only way to calculate an ROI of any type of investment you're going to make." — Stacey, [01:53]
• "Sometimes I think it's almost a little bit harder to truly calculate all that, which means... I think people forget to think about it." — Stacey, [11:40]
• "If you had a referral strategy in place, not only would it bring you more money, but would it mean that money comes in... faster." — Stacey, [12:14]
• "When you know what to do to cultivate referrals, it saves you time—maybe hours of mindless networking." — Stacey, [12:40]
• "For me, that's a top line and that's a top line investment ROI decision. Below that is when you know what to do and now you save time to generate referrals—that's an additional ROI." — Stacey, [14:30]

Important Timestamps

• 00:18 – Stacey introduces the episode’s focus: redefining ROI.
• 01:53 – Explains that ROI is about more than just money.
• 06:28 – Discusses key stats behind referral ROI.
• 08:11 – The challenge of quantifying time saved and better client fit.
• 12:37 – Cultivating referrals saves time compared to traditional networking.
• 13:15 – Case study from episode 333: the most valuable ROI is time saved.
• 14:30 – The top-down vs. layered approach to evaluating ROI.

Final Takeaways & Recommendations

• As you move into Q4, expand your definition of ROI to include:
  • Time savings (faster closes, less chasing leads)
  • Higher quality, more profitable clients
  • Reduced stress and more confidence in your business-building activities
• When evaluating a referral program investment (with Stacey or anyone else), balance the "dollar in/dollar out" calculation with the myriad intangible but impactful returns.
• Document and reflect on all ROI facets to guide your business planning for the upcoming year.

For referenced resources and the full transcript, visit: staceybrownrandall.com/381