“The Wharton School of Business found that a referred customer has a 16% higher life-time value.”
“People trust friends and family more than virtually any other information source, and pay 2x more attention to recommendations that come from friends than other sources.”
With stats like that, it only makes sense that customers gained from a refer-a-friend promotion are valuable and should be treated as such. Current customers are a great resource to gain even more customers who may be interested in your products. With the popularity of social media your current customers can easily share products they like with their friends.
“83% of satisfied customers are willing to refer products and services. But only 29% actually do.”
“A University of Chicago study found that non-cash incentives are 24% more effective at boosting performance than cash incentives.”
Through a business referral program, the company will be able to market the business for a chance of getting new customers and the current ones will be coming back for more deals. Here are some business referral ideas that you can use.
Getting contacts from customers
Every time that a sale has been closed, you can ask your customer to give you 3 of their friends contact numbers who may want some products or services that they sell. You can reinforce this by giving every face to face sales agent a sheet where they can add the names of referral. The company can implement an everyday quota of contacts for sales representatives to make the referral system much stronger.
Create a simple program wherein the customer can easily understand and join. Offer cash or rebates through points whenever their referred friends order from you. Another thing is you can give rebates, discounts or freebies whenever they refer one of their friends to your store. Make sure that you have weighed this properly and that you give the right amount of rewards to your customer.
Businesses sometimes need to make ways on how to retain their status on the market and grow bigger. Even though it sounds desperate and awkward, asking customers for more customers can indeed save the business and gives it a chance to bounce back.
Referrals are a form of advertising and promoting your business. As a matter of fact, it a form of free advertising. This is because referrals are word-of-mouth kind of promotion from satisfied customers. Indeed, when people are satisfied with a particular business, they would talk about it with their family and friends, and their family and friends will talk about it with others. This is a pretty effective way of, advertising indeed.
The only problem is that word-of-mouth referrals can take a long time to spread. When you are in business, you want things like this to spread like wildfire. Still, while the spread may be slow, but it is going to be a sure hit.
Recognition from customers
Providing discounts and other promotional techniques are the common means of advertising. They definitely work, but they are as good as they are going to get. The best way to advertise is to gain the public trust and recognition. If you offer quality goods and services at affordable prices, people will like you. They will patronize you. If you have a good business image, people will continue to flock your store and buy whatever it is that you are selling. This is, in fact, the most effective referral idea: make sure that your products or your services are of excellent quality.
Referral cards are now very common referral techniques. Basically, the cards can be used by the customers to be able to avail of special discounts or promos. However, there is a catch on the part of the businessman: the said privileges and benefits can only be received by the customer if he or she is able to convince other buyers to buy your product. The more that he or she can convince, the more benefits he or she will receive.
“Scratch my back, I will scratch yours.” This is, basically, the mantra of reciprocity. Basically, look for an agent or advertiser like yourself.
This agent should not be a direct competitor, of course. The idea is simple: you make referrals to the agent, and he will do the same for you.
Giving discounts is, perhaps the most common rewards for referrals. It is not to say that discounts are not effective. However, it would do you a lot of good to actually vary your rewards. One such variation is the gift package. If a particular customer has convinced five customers to buy your goods, you can give that customer a gift package. At any rate, there must be physical rewards.
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