Marketing, Referrals, Sales, Small business, Word of Mouth

Can you recommend someone to help me? The power of the referral…

Word of Mouth
Who is advocating for your business?

Do you remember the last time you said to your friend, “Hey, do you know a good massage therapist?  I don’t know who to go to!”  Or how about, “I’m looking for a new insurance provider, do you know someone who has flexible hours?”  You’re asking for a referral from a friend!

Referrals are an extremely important part of a growing business, especially if you have limited marketing funds.  The best part of referrals is that they cost very little but can have a high return on investment.  I say “can” because the return on investment is dependent on how you execute your referral program.  Many business owners I’ve encountered have enthusiastically proclaimed that they ask their customers for referrals all the time, which is an excellent start!  But how you ask for the referral will determine whether your customer passes along your contact information and whether their friend even remembers your name!

To convert those happy customers into your loyal advocates, you need to formalize a referral program, which is a marketing strategy for you to ask for referrals.  So what does a referral program consist of?

1) Happy customers who are willing to advocate for you.  I know that seems obvious but the key is to ensure that your happy customer remains happy.  That means you’ll need to check in with them every so often to ensure they are still happy with your business, service, and/or product.

2) Printed material that details exactly how your referral program works.  Create a short summary detailing your referral program so that your customers can understand how the program works.  Create a wallet-sized referral card that they can personalize so that you will know who the referral came from.  Once you get a referral, wouldn’t it be great if you thanked your customer afterwards with a thank you card?

3) Gain verbal commitment from your customer that they will refer your business to their friends and family.  It’s human nature to want to help people, especially if you have helped them in some way.  How do they know that you need help unless you ask!?!?!

4) A small nominal incentive for the referrer.  For example, you could offer to put all referrers into a monthly draw for a $10 gift card.  Most people will be motivated by the fact that they are helping you so the incentive is just the cherry on top.

Now, more than ever, we are seeing how important word of mouth advertising truly is.

Don’t know where to start with your referral program?  Want to know how to increase the effectiveness of your referral program?  Contact us directly to find out how we can help you maximize the number of referrals.

Until next time!