How To Build An Effective Customer Referral Program

Does your agency have an effective customer referral program? One that runs on autopilot once you start it? Or as a colleague of mine calls it, “a self-licking ice cream cone”?

 

By now you’ve learned customers don’t grow on trees. And I bet you’ve worked your butt off to build your loyal client base. But an easy-to-run referral program will help you build on what you’ve already got.

 

Don’t worry if you haven’t started. I was late to the game, too. But I recently built a quick, easy and effective customer referral program that’s already hitting it out of the park for us. And I want to share it with you so you can do the same.

 

Referral Program Results from the first 2 months:

50% Close ratio

14 New clients

 

Not too shabby for something that’s running on autopilot. Honestly, I have Jason Cass to thank for shedding light on automation sales concepts like this. If you’re hungry for more, he covers a ton of them in his book, Customer Service Is Just Foreplay.

 

If you’re ready to pick some low-hanging fruit, here’s what you need to create your own effective customer referral program.

 

Identify Your Referral Sources

An effective customer referral program begins with identifying as many referral sources as you can. These are the people who will make things happen for you.

 

Take out a pen and paper and brainstorm (with your staff) who would enjoy getting a reward for referring potential customers to your business.

 

Some common referral sources are:

• Current customers
• Friends and family
• Nearby local businesses
• People in other industries who share the same types of customers

 

That last one can be a bit tricky. I’ll give you an example. Our insurance agency gets referrals from mortgage brokers, real estate agents and captive insurance agencies (ie: State Farm, which is limited in the types of clients they can serve).

 

Choose A Reward Your Referral Sources Want

To ensure you’re building an effective customer referral program, you’ve got to know your clients’ demographics. Where do they eat? Shop? Play?

 

The answers to those questions should tell you what kind of reward to offer. Honestly, I would stick with gift cards. Don’t give away cash. Certain states have laws against “rebating”.

 

The last thing you want to do is start an effective customer referral program with good intentions only to end up on the wrong side of the law. I’m sure your company doesn’t need any bad press either.

 

We’ve kept it simple by offering 3 options for gift cards: Visa, Starbucks and Amazon. All of those options have a $25 value with Visa being the one almost everyone chooses.

 

We fulfill our gift card orders with Incentive Card Lab. It takes less than 5 minutes to choose a card, customize a “Thank You” message, and ship it directly to your referral source.

 

Other gift card ideas to consider are:

• Local restaurants
• Spa
• Gas card
• Video game store (ie: Game Stop)
• Movie theater

 

Create A Landing Page

Here’s the fun part (at least for a geek like me). Create a landing page on your website, like the one below, that advertises your customer referral program.

 

 

 

If you’re not comfortable working on your website, I would encourage you to check out LeadPages. Most of their landing page templates have very high conversion rates and are wicked easy to setup (requires no geeky website design experience). I’ve used their templates to collect 963 resumes so far (from qualified candidates) through my online recruiting strategies.

 

On the other hand, if you use WordPress or know how to update your website, I would recommend using Wufoo to collect the information you need from your referral sources.

 

Spread The Word

The last step of putting your highly effective customer referral program on autopilot is to get the word out. My advice to you here is to talk about it early and often. Remember, your competition may not be doing something as cool as this. Use it to illustrate what sets you apart from your competitors.

 

Here’s how to get the word out:

• Tell your employees in your next company meeting.
• Have all of your staff include a link to your referral landing page in their email signature. Think about how many emails you send a day. Now multiply that by the number of employees you have. Many of our referrals have come into the agency this way.

 

We use a nifty tool called WiseStamp to create really good looking signatures. You can create a FREE WiseStamp signature for your email here. This is what mine looks like with the customer referral link:

 

 

• Send every new client an email telling them about the program.
• Advertise your new referral program in your company newsletter. Hopefully you have an email newsletter. Because it’s a whole lot easier to click that referral link on your computer than on a piece of paper!
• Spread the word on social media…often.

 

Track Your Results

But wait…There’s one last thing you need to do! As with any new program you implement in your company, you should track its results. This will help you determine what’s working and what isn’t.

 

Sounds like a no-brainer? But you’d be surprised how many small business owners just “set it and forget it”. Don’t do that. Use data to figure out where there’s opportunity for improvement.

 

Here’s some ways we track our agency’s referral program:

• Google Analytics
• Wufoo Statistics
• Google Drive Spreadsheet (see below)

 

Do You Have An Effective Customer Referral Program In Place?

If so, share with me what’s working for you. Is your staff on board with it? How many new customers is it driving your way?