Why is a positive, successful referral program for your business important? Because getting your consumers to tell other people about your business is key and has been proven to be one of the most effective ways to increase your sales.
In fact, Nielsen reports:
- 92% of consumers trust referrals from people they know
- People are 4 times more likely to buy when referred by a friend
- 77% of consumers are more likely to buy a new product when learning about it from friends or family.
I don’t know about you, but if I watch a TV show I love, go to a restaurant that’s good, or visit a park with amazing trails, I tell people about it. I recommend these things to anyone I come in contact with that I think might enjoy them. I often even follow up with people to see if they checked it out!
On the flip side, I also take the advice of family, friends, someone I may not even know personally (such as a blogger or hollywood star) when they make a recommendation. I want to try a product or service from a business because I trust these people in my life and their word of mouth plug is good enough for me.
It makes sense, then, to try and increase the desire to refer in your customers. To create such a positive and enjoyable experience for them that they can’t NOT share it! To come up with a purposeful referral program that encourages them to send other people to your product or service.
Here 7 key things you can do to create and optimize a positive referral program.
1. Provide Excellent Service and Customer Experience
Before you can even begin to try and increase referrals, you have to make your business something worthy of being shared. Have you heard the expression “get all your ducks in a row”? Well, get out your measuring tape, level, and square and don’t just get them in a row. Get them in a perfect row.
These days it’s not just about getting a product or eating a meal. It’s about the actual box the product comes in and the light fixtures in the restaurant where you eat the meal. You have to make sure the experience of your customer is top notch from start to finish.
For example, some products come in a fancy box complete with a thank you note topping it off, asking the customer to take a photo and share their purchase on social media. It’s marketing from beginning to end.
Jim Rohn says, “One customer, well taken care of, could be more valuable than $10,000 worth of advertising.” Take care of your customers and they’ll take care of you. If you fail to care for your customers, don’t expect the referrals to come pouring in.
After you know your business is airtight and running smooth, you are ready to focus on referrals.
2. Analyze Your Statistics
If your webiste is already up and running, then you probably already have some referrals happening without even knowing it. Google Analytics provides tons of information about your website and where your visitors come from. MoonClerk makes it easy to integrate your analytics with your activity.
Taking a look at this information can help you know where to focus your attention and who you may want to reach out to with possible incentives should they send more people your way.
For example, consider these stats:
- Websites sending traffic to your site
- Social media platforms sending the most traffic
- The pages getting the most referral traffic
These statistics can help you understand why people are coming to your site, where they’re coming from, and how you can improve those numbers.
If you need help understanding Google Analytics, here’s a helpful introductory article.
Looking at your analytics isn’t a one time thing- it’s important to maintain all your information and keep your tech organized and up to date. It will continue to provide you with information as your business grows and your referrals and incentives change.
3. Install Referral Widgets to your Website
Making it easier for your customers to refer is important. We all know that even one extra click will deter people from making a purchase or sharing something online.
Place these widgets in multiple locations. Don’t only offer the opportunity to your customers to refer after they purchase (although that’s a must place spot), place an overlay on your homepage as well as the user account page.
MoonClerk currently partners with TapAffiliate to make affiliate creation and tracking really simple.
It is a great idea to create a stand alone referral page which acts as a landing page for referrals. You can link to this stand alone page from Facebook, Twitter, Linked in, and send an email blast that links to this page as well. (Get this on a calendar and send it out regularly such as once a month or every six weeks.)
Any other creative way you can think of to place these widgets or links to your referral page will increase visibility of your referral program and thus increase your percentage of referrals overall.
4. Provide Rewards for Referrals
Sure, we all recommend our favorite products or services, but even more so if we are rewarded for spreading the news!
Setting up a program for your customers that rewards them when they refer another person will give them the push they need to send people your way. Incentives that reward both the advocate and the referred are most successful.
There are many ways to offer incentive to your referring and new customers. Some examples include: a reward point system, money toward their next purchase, discounts, free shipping, coupons, free trials, a free month (for subscriptions), and store credit.
5. Do Some A/B Testing
A/B testing is simply testing option A against option B and seeing which performs better.
Let’s say, for example, a subscription box business ran a “Refer a friend and get 50% off your next box purchase” campaign. Would it be more successful if they had worded their promotion “Refer a friend and get $10 off your next box purchase” (if the subscription is $20) and found that this drew in even more new customers?
Other tests you can run are ones that set two different titles side by side. Take for example these two Facebook titles: “Sure to make Dad Smile this Year” versus “The Perfect Father’s Day Gift!” Which one do you think would be more successful? The only way you can know is to test them.
Trying testing different words, different colors, and different places on your website to see what works best.
Running tests such as these will provide you with valuable information on how to present and word your incentive campaigns in the future.
6. Get A “Celebrity” Endorsement
Obviously you probably don’t have the capital to pay the latest Oscar winner to use their influence to refer people to your business or recommend your product.
However, there are many blogs, vlogs, podcasts, and websites run by people who are “famous” in their field. For example, maybe you run a business where you sell custom calligraphy signs. There are plenty of artists, art teachers, or interior designers who are popular online and have many followers.
Offer to send them your product and ask if they would be willing to review it and refer people to your website. You could even attach a coupon code specific to your “famous” person and you would be able to track the number of referrals you get in this way. If you want to up the stakes even more, offer to give the celebrity a cut of every sale that comes specifically from them.
Getting an endorsement from someone with a large following can be as easy as reaching out to them to see if they would review or endorse your product. It’s a great way to get referrals!
7. Review…and Thank You!
Encouraging people to leave a review of your product goes a long way with potential customers. People trust what other people say about your business more than what you say.
Customers who leave a positive review may not bring traffic to your site in the same way as incentive referrals or marketing blasts, but positive reviews can bring new customers and eventually more referrals.
When a customer refers someone, thank them! This could be a simple email or something more elaborate such as a gift, but whatever you do, it is important to show your advocates that you value them and that their referral is important to you.
In the End
If you take the time to build a positive referral program, the benefits will exponentially affect your business for the better.
Put forth the effort and don’t be afraid to try something new. Growing a community of advocates for your brand that will refer new customers is a powerful and these days, mandatory way to promote your business.
So gather your resources and begin your positive referral program today!