I recently shared my ideas on the concept of confidence accumulation and its importance to cultivating referrals to some of my peers at a TEN luncheon.

We know that referrals are one of the most powerful drivers of business development (marketing giant Nike says that the vast majority of its business is from referrals). We also know that the science behind promoting good referrals involves creating a good experience, and to create a good experience you need to manage your touch points—not all your touch points though, only those that are important to your target market.

But how exactly do positive experiences at relevant touch points translate into referrals? Why is it that 100 good touch points can be ruined by 1 mediocre one?

One way to think about referrals is through the concept of accumulation.

In order for potential clients to decide to do business with you, to actually reach into their pockets and pull out their wallets, they need to feel confident that what they’re going to receive in exchange for their money is of equal value. There needs to be a certain level of confidence on their part, in your product or service. What’s more, that level of required confidence varies depending on the product or service. Common commodities like toothpaste or shampoo have a lower threshold of confidence that must be reached than, say, consulting services or a more significant product like a car or home.

For someone to refer your company, an accumulation of confidence also needs to occur—and perhaps even more so, because a referral reflects back on the person who gave it.

Here’s the connection: each touch point either adds to or detracts from that confidence.

This is why managing each touch point is so crucial, and also why some touch points should be weighted heavier than others. (How do you know which touch points to focus on? Survey your customers.)

For instance, a web-savvy consumer checks out a company’s website (one of his highly valued touch points) before going to the store to purchase something. If the website is terrible, he may not even go into the store because the amount of confidence lost in his interaction with this crucial touch point could be too much to recover.

On the other hand, another consumer might place more value in the appearance and manner of the company’s staff, and not care at all about the website.

The point is, think of your company’s touch points, think about the ones that matter most to your target, and then figure out how to make them confidence builders, not confidence detractors. It’s also important to make sure there aren’t any inconsistencies between your touch points, because inconsistency is one of the most detrimental factors to the accumulation of confidence.

People always think that good customer service is enough to generate referrals. But what does that mean exactly? Responsiveness? Expertise? Look and feel? In fact, someone’s willingness to refer your business is based on an accumulation of confidence over multiple touch points.