The Power of a Referral
If you had to choose the single form of marketing that is most profitable for your business, what would it be? For many business owners, the answer is easy: referrals. This often overlooked form of marketing can be one of your greatest tools, but harnessing the power of a referral takes intentional planning.
The statistics surrounding referrals are clear — not only is someone who is referred to your business far more likely to purchase, but they’re also more likely to remain a loyal client and refer their friends in the future. In addition, clients who are referred to you also tend to purchase more from you throughout their journey with your company.
This is for a few different reasons, which I’ll discuss below; if you want to increase your referral business, you’ll want to set up a VIP Referral Program. This program makes it easy for your clients and contacts to refer you and incentivizes them to do so — but it also makes it easy for your referrals to get in touch quickly and decide if you’re the right fit for them!
The Stats Surrounding Referrals
Any business owner that has held a variety of sales conversations can tell you that referral clients are often far easier to close. What are the actual numbers, though?
Obviously, these numbers will vary by business and industry, but on average, referral clients are:
· 4 times more likely to purchase from or hire you
· 37% more likely to stay with you as a loyal client
When working with a company that has a formal referral program, these numbers jump significantly. Here are just a few of the statistics:
· Over 50% of clients are likely to actively give referrals when an incentive or loyalty program is in place
· 78% of businesses that run referral programs have found that referral clients are more loyal than clients gained through other methods
The most shocking number though? Only 30% of small businesses have formal referral programs in place. If yours isn’t one of them, you’re missing out on business!
Putting a VIP Referral Program in Place
Starting your own VIP Referral Program doesn’t have to be difficult, but it does take intentional planning. It should be easy for your clients to navigate, easy for your referrals to contact and connect with you, and simple for your team to manage.
First, take some time to sketch the program out before you build it. How will clients find it? What happens when they contact you with a referral? What will you send your clients as a thank you or incentive?
Next, involve key members of your team in building it out and documenting the process so that it can be run smoothly. Which parts of it will be automated, and which will need a human component? What checks and balances will you put in place to make sure no one slips through the cracks?
Once you have your program details in place, it’s time to build and implement your program — and you’ll want to make sure you have your Policies & Procedures, scripts, and templates available for your team!
Getting the Word Out
Once your referral program is in place, how can you get the word out about it so your clients can start referring people?
Often, the easiest way to strategize this is to draw it out, either on your screen (Skitch is a great program for this), your Rocketbook, or on paper. Think about your customer journey — where would the natural touch points be?
This will be different for every business, but yours may include events like passing a major milestone, achieving a win, or finishing a specific service with you. If your business includes product sales, it may involve asking for referrals within a few days of delivery, when you’re still top of mind but your client has had a bit of time to see the quality of your product.
Often, this is best done by email — and this is a great thing to automate. You can set up automations in your email service provider that can be triggered by a purchase, a certain amount of time after hiring you, or a manual trigger that a member of your team initiates. You can set up a program that works for your clients and your team!
Whatever your timeline may be, make sure that you provide both a polite but clear request and clear instructions for providing a referral. If you make it easy, referrals are more likely to come your way!
If we can help you increase your referral business or set up your referral program, let us know!
Kristen David, a former trial lawyer and partner who went from working 85 hours a week and taking home way too little money in her law firm, built it up to a million-dollar-plus business, then sold her shares and pivoted into a business coach guru. She is now an international speaker, bestselling author, and operates a successful business, empowering business owners to build thriving, profitable businesses that are self-managed with systems. She helps busy business owners build those systems by implementing policies and procedures the Fast Track Way.
Originally published at https://www.uplevelingyourbusiness.com/.