Generating leads is important for any business who wants to succeed. However, there are many different techniques for lead generation, and it can be hard for business owners to know which are the smartest and most important to focus on. One of the most important and often overlooked lead generation strategy is referral marketing. Referral marketing programs can help companies grow their customer base while keeping current customers loyal and happy. Here’s what a referral marketing program is, how your business can benefit, and some ideas for setting one up.
What is a Referral Marketing Program?
Referral marketing happens when you use happy, satisfied customers to bring new customers into your business. Essentially, referral marketing programs rely on word-of-mouth marketing in order to generate buzz for your business and get people interested in buying, too. When you have a referral marketing program, you offer people incentives to refer people to you. This could be a discount on your product or services, a concrete, tangible gift, or special access to events and promotions.
Why Use a Referral Marketing Program?
Referral marketing programs are smart for your business because they work. Studies show that word-of-mouth marketing is important because it helps build trust. Trust is key when it comes to convincing people to do business with a company. In fact, research shows that 84% of buyers trust recommendations from people that they know more than they do from any other form of advertising from your company. Additionally, research from IvespCRO showed that referral marketing leads convert 30% more often than those that were generated from other marketing efforts. So, if you want to use a marketing program that effectively builds trust in your business and that actually converts leads, it makes sense to turn to a referral marketing program.
How Do I Create a Referral Marketing Program?
If you want to create a referral marketing program for your business, there are a few easy steps that I recommend that you take.
Decide on Your Goals
Before you build your referral program, decide what you want it to do for you. Do you want to help build your brand reputation? Do you simply want to increase the number of sales you are making? Define your goals first. Then you will be able to tailor the program since you will understand what you want it to help you achieve.
Choose the Incentives
Next, you want to choose incentives that help encourage your customers to refer people to your business. You want to pick incentives that will motivate your customer base. You also want to choose financially smart incentives so your business only makes money from the program and does not lose it.
Let People Know about the Program
Once you’ve chosen the incentives, announce the program. You may consider sending out an email newsletter, posting on social media, and putting information about the referral marketing program in your brick and mortar store. Letting people know about the program far and wide will encourage people to take part in it.
Track, Analyze, and Tweak
Once you’ve rolled out your referral marketing program,
track it. See if people are participating and if they are bringing in leads who
convert. Stick with the things that are working. If something seems to be
failing (the incentives aren’t motivating enough, the leads aren’t converting),
tweak your process.
Referrals are for business of all sizes. In
fact, I use referral marketing myself, and I’m always looking for people who
want to bring people into my business. If you provide a referral for me, I
would gladly set up a social media advertising campaign for you with a free
$100 credit. Help me harness the power of word of mouth marketing today, and I
will help you take full advantage of the power of social media.