Getting new costumers is indeed a costly affair for businesses, but not in the latter’s case wherein lead generation was done by means of generating referrals.
Giving referrals has been a conventional part of human nature; from the best restaurants in town, to the best tourist destinations, to salons, movies, beauty products, etc. chances are, we first seek referrals from people we trust and from people who already experienced, tasted, traveled and saw a particular thing or place. In fact, people do these not simply because they’re looking for information but because they find you credible and trustworthy thus reduces doubt on the one inquirer’s part.
Same as through when it comes to sales lead generation wherein referrals also play a big role for a business to acquire prospects that will ultimately become its customers. And talking about cost effectiveness? Well, this is probably one of the most cost efficient strategies to generate sales leads.
However, many marketers don’t utilize this kind of technique because they’re shy to do so. But what these people don’t know is that existing customers are actually glad to return them a favor after a great service you've given and provided them. But of course you can’t assure that 100% of your customers will give you referrals; nevertheless, you still have a greater chance, say 7 out of 10 of your customers will scratch your back after you scratch theirs. All you have to do is to maximize your efficiency as a service provider and satisfy your customers because these people will be your instruments to generate newer and fresher sales leads.