Brands are forever waging war over consumer attention; and not just to get our business, they want to keep it, too. Client retention plays a long game with consumers, incentivizing with loyalty programs and initiatives that may give pause to would-be defectors. After all, it’s easier to keep a current client happy, than it is to persuade someone to switch brands.
But it’s not impossible.
Referral marketing is often viewed as a natural byproduct of a company doing its job well—when a customer has a great experience with a brand, they’re more likely to tell their friends and family about it, right? That’s the assumption anyways.
According to a recent study, only about 29% of consumers offer positive referrals, even though 83% of consumers report they’d be willing to do so, if they had a good experience.
To put it another way, most people are willing to refer a good company, but only a handful of these people ever get around to doing it.
If you’re looking for ways to improve client retention, referral marketing offers unlikely synergy. With the right tools and implementation, you can easily attract more referrals to your business, and keep current clients happy.
Let’s look at 3 ways client retention and referral marketing align to achieve this end:
Unlike traditional marketing, referral marketing is inherently personal. When someone refers your company, they’re putting a lot of faith in you to do right by the person they’re referring.
A good referral can have a positive effect on everybody: the person giving the referral, the person receiving it, and ultimately, your business. It’s a win-win-win.
Moreover, a good referral drives business to your company, which in turn creates more opportunities for more referrals.
Plus, when it comes to doing business, most people prefer working with people they know. Prospects that receive a friendly referral are more relaxed exploring a new company than if they simply stumbled in through online display advertising. This mindset is what makes referral marketing so powerful.
Not everything about client retention is complicated. In fact, in some cases, all it takes is a friendly reminder.
Never assume that referrals will happen organically if you just do a good job. You’ve got to reach out and nudge your customers at every touch point in your sales funnel and provide them with easy opportunities to refer your business.
Organic referrals happen, but this only amounts to that handful of people already spreading the good word. Referral marketing needs a hands-on approach, with proactive tools that premeditate a customer’s needs.
Referrals should be easy to give, and functional across a slew of devices. Streamline a customer’s ability to give a referral and you’ll get more of them. Stay connected and remind customers at every touch point and you’ll get even more.
Like client retention programs, referral marketing should not operate in a vacuum. To be most effective, referral marketing should live in an environment of perpetual optimization.
For example, some customers are influenced to give referrals by different types of incentives. Some customers may enjoy being an early adopter of a new product, whereas a discount or savings may drive other customers to act.
Personalize referral incentives to the right customers at the right time and you’ll make even bigger fans out of these clients, and enjoy a higher referral rate in return.
What’s more, some customers may have a larger sphere of influence than others. Pay close attention to these clients. In some cases, it may be a great opportunity to invite some friendly influencer marketing into the mix, which functions similarly to referral marketing, on a larger scale. Optimizing these opportunities with the right incentives is the best policy.
Client retention and referral marketing align on several levels; both ending in more profits for your business. Use these three tips to get more referrals today, or explore how referral marketing can work for your business. Click here to learn more about our software and pricing. Post author: Mike Rowan
Post author: Mike Rowan