Yes this business is all about referrals. Jimmy Dunlap the original Ninja, a Real Estate agent with the Group in Ft. Collins CO, says that if you want to just do one thing to amp up your business it is making sure you focus on the individuals that send you referrals.
If you look at the math it makes sence. If you have a database of 100 individuals lets say and we know that the mobility rate is 15% a year, then you have about 15 deals to mine from the data base this year. That said everyone in your database if properly kept in touch with will have between 2-4 referrals for you each year. Lets be conservative and say your database of 100 would potentially have 200 referrals and being a good Real Estate agent you close just 40% of them which would be 80 deals. So 80 deals plus 15 is 95 real estate transactions a year. The referral side is almost 80% of the business. Here is the big question you have to ask yourself. Are you visible to your database or invisible? How much communicating do you do when one of your friends and or family send you a referral? Do you thank them? Do you follow up with them as the transaction unfolds? Do you reach out after and offer up thanks or appreciation? If your referral source is calling you asking "hey what ever happened with that friend I sent over?" Chances are not good that they will ever refer again.
Keep in mind referrals only come to you if the person referring knows you will make them look good and that they are not left in the dark as to the outcome of that referral. This business is about having good communication and building relationships that last. Just think back about the last referral you had. If they sent you more than one this year then you must be acting accordingly. Food for thought.