Referral marketing is a powerful way to acquire new customers and retain existing ones.
Here are some best practices for referral marketing strategy in 2023 based on universal principles, along with current trends:
Create A Referral Marketing Program
that’s easy to understand and use that you will actually follow. Make sure your referral program is clear, concise, and easy to participate in for all parties. Use simple language and clear instructions to make it easy for your customers to refer to their network.
The #1 failure of most businesses is the lack of a foundational referral system to drive referral generation and conversion with a systematic process that can be scaled across their organization. If you don’t know how to create one that works for you, try this one you can take off the shelf that does most of the work for you.
Offer Incentives
that motivate customers to refer: Offer rewards that are valuable enough to motivate your customers to refer their friends and family. This could be in the form of discounts, free products, or exclusive access to special promotions. Using incentives increases referrals by up to 50%!
One of the most popular and effective incentives has recently been Amazon gift cards that incent conversion of a referral to a customer. Who doesn’t like those? They are easy to administer and can help keep your referral source engaged in the conversion process.
Make It Easy For Customers To Share Your Referral link
Last week I wrote a blog that provides a deep dive into referral links that you can access here. Provide your customers with a referral link that they can easily share on social media or via email. The same link can be used by you to add to multiple platforms. Make sure the link is easy to copy and paste, and that it works on all devices.
Personalize The Referral Experience
Personalize the referral experience for each customer by providing them with a unique referral link and messaging that speaks to their individual interests and needs. Your outreach messaging via email, text, or social (the top ways people refer), should be plain text, non-” spammy” and include personalized greeting language in your unique style and in your voice. Make sure you include links to value-added content wherever possible, and make sure your campaigns go out to clients/customers, your network, and past un-converted prospects with unique messaging to each.
Follow Up Effectively
Follow up with referral sources right away to thank them for their referrals. This helps build trust and encourages them to refer others in the future. Remind them of any incentives you have in place for them to help along with engagement to help the referral convert to a client.
Your follow-up with the referral should also be timely. You will need to do 3 things to effectively convert a referral to a meeting and then a client:
Trust must be transferred through an effective and easy-to-make introduction from the referral source to their referral. This rarely happens and usually makes for an awkward conversation. You need a system to do this well.
The referral needs to be moderately disrupted so they believe they may need to meet with you – we use a very effective quiz process to do this. You can too.
There needs to be an easy way to make sure the above happens whether you have the skills or courage to do it or not. Our system does that for you if you want to check that out.
Monitor And Track Your Referral Program
Use analytics to monitor the success of your referral program and identify areas for improvement. Keep track of your referral sources and adjust your program as needed to maximize results.
Your tracking should include outreach metrics such as email delivery, open rate, and click rate, but should also include metrics on the conversion of every step of the engagement and conversion process. For larger organizations, you should have an enterprise dashboard with full engagement, individual performance, and company performance metrics to track ROI across your organization and capture best practices.
Promote Your Referral Program
Promote your referral program through social media, email marketing, and other channels to get the word out and encourage participation. The key here is to understand the “human nature’ element as to why people and businesses refer. The #1 reason is to simply make a difference. Make sure you make it easy for them to do that. They want to: 91% of consumers would refer if asked yet less than 10% of professionals ask!
Make Sure You Are Referable
Once you have a system in place that takes care of the 5 key behaviors of referral success (ask, incentivize, introduce, disrupt, and generate meetings), the key is to make sure you are highly referable. Generally, this means increasing contact, adding more value, and demonstrating values (showing up on time, doing what you say, finishing what you start, and saying please and thank you). If you don’t know how referable you may be, take a 2 minute free quiz to find out and help determine what you may need to work on.
By following these best practices, you can create a referral program that drives new business and helps you retain your existing customers.
ReferMe IQ™ is passionate about helping organizations build high-growth referral-based businesses with their ”state of the art” automated referral platform. Peter S. Velardi is an accomplished senior executive and entrepreneur who has impacted thousands of individuals and organizations to build a fast-growing referral-based business.
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Post author: Peter S. Velardi
