Ways to Generate More Referral Business
Increasing your number of referrals today can be accomplished by growing your referral business through your existing customers and business partnerships, which is an excellent method for boosting your acquisition rates and ensuring that your business remains top-of-mind. Let’s explore the strategies for achieving this goal.
1. Create compelling referral programs
Want to increase your referral business? Implement a referral program!
Creating a referral program can be a beneficial method to both reward loyal customers and attract new ones. However, developing one from the beginning can be challenging. Essentially, your business needs to devise a sustainable program that accomplishes three goals: 1) rewards customers who refer others, 2) brings in and retains the referred customers, and 3) provides the most value for your business.
To ensure that all your customers come back for more, it is important to consider the following factors in establishing an effective referral program:
- Come up with a strong referral program name
- Promote attractive sign-up forms on your social media and online review platforms
- Incentivize through referral rewards like promoter points, service gift cards, and discounts
- Develop an efficient tracking system
- Keep referral promoters engaged with exclusive pricing, offers, and incentives
2. Engage with online review platforms
To ensure consistent customers, encourage them to review your business on platforms such as Yelp, Google Business, and Facebook.
Your customers and prospects are currently dedicating their time to these platforms. Utilizing them is a cost-effective and straightforward method to create online buzz and acquire referral business. Envision these platforms as amplifiers that your customers utilize to share information about your business with their acquaintances, relatives, and coworkers.
Instead of solely seeking reviews from satisfied customers, it is important to prioritize obtaining reviews from all customers. By doing so, you can effectively turn negative feedback into a positive outcome for your business. This demonstrates your commitment to ensuring customer satisfaction and could even result in retaining customers who may have otherwise discontinued their association with your business.
3. Launch social media contests
Encouraging your customers to actively participate on your business’s behalf, a social media contest is an excellent method.
A social media contest, when done correctly, can effectively promote your brand and spread awareness about your services, simultaneously involving your customers in the process. Moreover, it has the potential to expand your customer base, enhance brand recognition, and provide you with a larger audience for marketing your services.
Contests offer the advantage of generating free advertising for your business as they enable you to utilize the audience of other social media users for your own campaign.
If you are a home service business, you have the option to motivate your current customers to refer more people by including social sharing as a rule in a contest. Here are some general suggestions on how to create an effective social media contest:
- Use the right platform: Find out which social media platform your customers are more active on and launch it there.
- Incentivize through the right prizes: Depending on your customer base and business type, the incentives/rewards can vary but ensure the prize has enough value to entice customers into participating while not being too expensive for your business to provide.
- Focus on community engagement: Contests are a great way to build a wealth of customer data and engage directly with interested prospects. Collect customer information and encourage more leads through participation.
4. Join a local or small business network
Networking groups are extremely valuable for businesses looking to acquire customers. Take the time to research and identify the small business networks in your area that are most suitable and aligned with your requirements. By joining a small business network, you gain the opportunity to connect with other professionals in your industry, which can be beneficial for generating business referrals and enhancing your overall presence in the market.
Utilize the tried and tested approach: Utilize business cards.
Despite the digital age, business cards continue to be relevant and valuable. Despite some perceiving them as old-fashioned or outdated, the effectiveness of this straightforward approach remains unchanged.
In a quick view, your customers can easily understand the nature of your business and have your contact information readily available for when they are ready to contact you. You have the option to request your current customers to hand these out to potential new clients, thus increasing your referrals. Alternatively, you can ask fellow business owners in your network to recommend you at an opportune moment!
For instance, as a roofer, if you network with real estate agents in your area, an effective strategy to generate referral business would be to distribute your business cards among these agents and request them to distribute them at appropriate moments.
6. Treat your customers well
The initial step is crucial for the success of referral systems even though it is not directly associated with them. It is necessary to ensure that your customers have a positive perception of their purchase and their connection with your brand.
There are several methods to accomplish this. Some pertain to the organization of your business. As per the Economist Intelligence Unit, by 2020, 86% of marketers predict they will be accountable for the complete customer journey because marketers frequently comprehend the factors that influence customer behavior better than sales teams.
In addition to that, there are strategies that center on customers. It is important to establish trust with your customers by handling their data responsibly, and also acknowledge customers who utilize your products in innovative ways.
By emphasizing that their success is a result of their effort, communicate that they might be utilizing your product. Express appreciation for these customers, and when the occasion arises, they will be likely to recall and provide referrals.
7. Make it easy to refer you
Firstly, ensure that your customers are aware of the process for referring their friends or colleagues to your company, and ensure that it is easily accessible for them to do so. Studies indicate that more than 80% of content customers are eager to recommend your company, yet only 25% follow through with referrals.
In many instances, customers are unaware of the process to do so which is why they usually do not leave reviews. To ensure that customers have a means of sharing their positive experience with others, make sure to provide them with a way to do so.
In terms of local marketing, word-of-mouth recommendations play a vital role as they are highly effective in boosting sales within the community.
You can also request your happy customers to mention your store on social media or provide a simple way to invite a friend or relative, ensuring that you appreciate the community’s contribution to the growth of your business and regularly express gratitude towards them.
8. Reward your referrers
Referral rewards are the pinnacle of effective marketing strategies and can elevate your referral marketing efforts. Nevertheless, their implementation can be challenging, particularly in the context of local marketing campaigns.
Providing a direct monetary incentive for successful referrals may appear distasteful as it implies that you are trying to buy your customers’ participation in your outreach marketing efforts.
In order to maintain the same meaning, while thinking step by step, you should consider providing rewards other than money for referrals, and focus on encouraging natural referrals rather than offering payment for them. These rewards may consist of presents, a yearly subscription to a relevant publication, or a monetary contribution to a charitable organization.
9. Measuring the success of referral campaigns
To ensure the effectiveness of your new referral program, it is important to track its success. This may seem daunting for small businesses, but there are numerous courses available to help you gain the necessary skills to work with data and utilize the built-in features of your website for tracking referrals and customer journeys.
You have multiple metrics available to evaluate the effectiveness of your referral campaign. One metric is the quantity of users who share your invites. Another metric is the total number of hits on your referral page.
When considering various measurements, the churn rate stands out as potentially the most significant. This rate reveals the number of customers who discontinue their relationship with your company. An elevated churn rate unquestionably indicates that the products or services being provided to customers are not meeting their expectations. Conversely, a lower churn rate suggests that your referral marketing campaign is achieving success.
10. Keeping things secure
It is important to prioritize the protection of sensitive information, such as personal and financial customer data, when engaging in marketing activities.
To ensure protection against hackers, it is advisable to utilize a referral program that includes a security system. This eliminates the need for manual tracking of each referral and provides peace of mind by employing a robust defense against cybercriminals, whose threat has intensified during the pandemic.
To ensure the utmost protection for your referral program, it is essential to implement strict terms and conditions to prevent fraud. Additionally, employing a transaction ID monitor, a duplicate blocking feature, and consistently utilizing a virtual private network (VPN) to encrypt all business and customer data transmitted over your company network will safeguard against hackers.
Although some local businesses with limited budgets choose not to use a VPN, thinking that it helps them save money, the reality is that there are quality VPN providers available for as little as $6. Therefore, there is no valid reason for businesses not to use one.
Side notes
Without a doubt, when executed correctly, referral marketing has the potential to greatly benefit your business. Our aim is to assist your business in achieving this outcome.
When your business is new, local marketing can be challenging, particularly in acquiring the first customer, which is often the most difficult step. It is essential to evaluate all the potential tactics available, including local SEO and referral marketing.
Referral marketing is highly effective due to its ability to capitalize on the enthusiasm of initial customers and expedite the establishment of brand awareness and trust within the community.
