You’ve heard the advice a million times. Set up a referral program for your business and get more leads. But sometimes just setting up the program isn’t enough. Do you want to know how to optimize the effectiveness of your referral program? This article will outline the ways to do just that in 2021.
What is a referral program?
To answer your question, a referral program is a marketing tactic that encourages current customers or clients to recommend people they know to your business, such as inventory management software. This is often called a word of mouth referral. Another way to implement this is by directly asking your customer leads who might benefit from your service.
Why use a referral program?
I’m sure that on more than one occasion someone you know has recommended a product or service to you. This is either because it is something they like or you asked for a recommendation. In either case, it’s probable that you went to the service or business they told you about. Why is this though?
To sum it up in one word, trust. A study done by the Nielsen institute showed that from their global respondents, more than 8 out of 10 or 83% trust the recommendations they get from friends and family. Likewise, you trust the people you know to give you a good suggestion.
A referral is one of the easiest ways to get leads. Not only this but this study from the University of Pennsylvania says that “those referred by other customers generate higher profit margins, are more loyal and show a higher customer lifetime value (CLV).” With such positive benefits, its no wonder that many businesses are using this tactic to get quality leads.
How to make the most of your referral program?
I know that’s what you’re thinking, right? So stay with me here, I’m getting there. Many businesses don’t know the best ways to implement their referral program. After reading the next part you won’t be one of them.
Know your client and their incentives
For starters, it’s important to know your clients and what your main goal is. This is so you can create an incentive that benefits your customers and works towards your goal at the same time
An incentive is something that your customer values or desires from a business. This can be points towards a loyalty program, cashback, discounts, or even free items. Some companies go as far as giving the referred person a reward too. For example, the referrer gets a free month of membership if their friend signs up. The friend who was referred gets 2 free weeks just by signing up through your client. Make the referral worth their time and effort. The customer journey can then be tracked with intuitive membership management software like Impexium.
Knowing your client builds more trust between you. You will have a stronger relationship with them which will keep them coming back and make them more willing to refer you to others. I don’t see any downsides here.
You read that right, I said be awesome! Being awesome means doing more for your clients. If you’re awesome you are going above and beyond for your clients. You’re giving them the best customer experience possible and exceeding their expectations. It sounds simple but in order to do this, the aforementioned, knowing your customer is important.
Giving great customer experience will keep your client’s talking. If they are happy with the service they will share it with others. They will want more people to have the same awesome experience they had.
In order to give an out of this world customer experience, you have to know what the current experience is. To know what the experience is you should be getting feedback in some form from your clients. This feedback will tell you what you’re doing right and what you might be able to improve on.
Beyond that, the fact that you take time to consider and implement your client’s feedback will make them feel valued. And it gives you ideas and options for future programs or incentives.
Keep it Simple
You’ve already heard the acronym K.I.S.S. In case you haven’t, it stands for Keep It Simple Stu… well, you can guess the rest. It’s important to keep the referral program easy to use and easy to spot.
If you’re putting it on a website make sure it’s in a visible place and is clear to see. If it’s in print form or word of mouth make sure that you or your employees are letting your clients know about the program and the cool things they can get from it. In short, make it easy for clients to know about and to share your referral program.
Track, Track, Track
This next part should be a no-brainer. Keep track of your referral program. An efficient and accurate record of your referrals is a must. This way you get and keep data on your program’s profit and effectiveness.
A good tracking system not only lets you manage your referrals but also tells you which of your clients participated. Also, who they referred. This leads to the next and final point.
Mind your manners and say thank you
Your mother was right to tell you to mind your manners. Thanking your clients new and old is always the way to go. Thanking them for their participation or for signing up will show you appreciate them. They’ll also be more likely to participate in future programs.
And That’s It!
Referral programs are sure to give you more profit and loyal customers. To make the most of referral programs in 2021 be sure to build a strong relationship with your client. Give them incentives, exceed their expectations, make it easy for them to participate and know about the program.
Sounds a bit “too much” to do it manually? Find yourself a system that does it for you. EarlyParrot is the one chosen by thousands of referral marketing geeks around the planet. LiveWebinar can help you make the most of your referral marketing with webinars, too.
Make sure to track the hard work done by each party. Listen to your parent’s advice and be sure to say thank you!
But don’t just take my word for it, optimize your referral program and implement these tips today.