As business owners, we all know the power behind word of mouth marketing, right? What people say about your business when you’re not around, has the ability to make or break it, no matter how much money you plough into Facebook advertising or a fancy new website.
And although the majority of the time our focus is often on attracting cold leads, setting up a referral system can offer a greater return on investment than constantly reaching out to new customers.
What do I mean by a referral system? To simplify it, referrals are when a current or past customer recommends your services or product. According to Entrepreneur.com, people are 3 x more likely to buy from a company that has been recommended to them, which just goes to show what a cost-effective advertising tool it is.
To be blunt, you’re throwing away ample potential leads with each customer if you don’t integrate a referral scheme into your marketing plan.
How many times have you bought a product or used a service after hearing glowing reviews from your friends? There’s already an element of trust in said brand because, let’s be honest, if it’s good enough for the people we know, then we’re more likely to take the financial gamble of investing our cash.
In this current economic climate, shoppers are more risk-averse than ever before – researching, price-shopping and expecting way more bang for their buck.
It’s also worth noting, when your customer refers your company to someone else, they’re more likely to recommend you to someone who actually needs your services. Therefore, you’ll be attracting the kind of customer from the get-go.
Plus, people love to give recommendations. The number of vouchers for weekly food boxes I receive from friends and family proves the power of a discount code referral scheme. I get one box free, they get one box free. Everybody wins, and if I enjoy the service, I’ll do exactly the same with another friend. And so the train continues…
So how do you include referrals into your marketing plan?
- Ask customers directly while you’re working
together,when they’re more likely to respond. After you’ve finished working together, you’re not a focus for the client’s already-busy schedule
- Send a direct, personal email. Be honest and say it would be great if they could recommend your service/product, and in turn help your business grow
- Choose your clients carefully, however. If there have been elements of working with a client that
havebeen tough, chances are, people in their circle could have a similar mindset
- Offer an incentive such a discount code, or a voucher for the client as a thank you once a referral has come on board. This can be a relatively inexpensive outlay like a gift voucher
- Speaking of which, send a thank you note to the clients that have referred you every now and again. It’s small touches like this that will keep the recommendations coming in
- And finally, if a client isn’t able to refer you for whatever reason but they’re still happy with your service, ask for a testimonial. This is a quick process that has the potential to sway a new customer your way
Do you offer a referral service as part of your marketing plan? If not, plan time to work out how you can maximise your warm leads with referral marketing.
We’d love to hear from you! Are you using client referrals inside your business? What works / doesn’t work for you? Share below in the comments!