Word-of-mouth is still the most effective form of advertising for businesses. Read here to learn 7 ways you can improve your customer referral strategy.
Whether you run a blue ocean startup or a large company in a mature market, selling your product is likely the greatest challenge for your organization. This is especially true since 84% of buyers begin their product or service search with a referral.
If you don’t have a built-out referral strategy, you’ll lose a ton of business to the competition–even if you’re the best in your industry. When you regularly ask for referrals, your customers get used to sending leads your way.
Does your referral strategy leave something to be desired? Read on for expert tips to help you boost your strategy and get more opportunities for sales.
1. Make Sure Your Customers Are Satisfied
This should be obvious, but a customer or client is not going to refer you to anyone if your product or service isn’t amazing. If you’ve been having problems with customer complaints, you should fix those issues first to improve your referral strategy.
To fix issues with your product or service, collect customer complaints through surveys, online reviews, or over the phone. In this outreach, explain that you’re actively trying to improve your offering.
Through data collection, you should be able to identify trends in the problems you’re experiencing. Even if it’s a seemingly one-off problem, still look into it. Make correcting the issue your top priority.
Creating a better product or service isn’t all about increasing sales. It’s about making your current customers happy. When your customers are happy with you and your offering, they’re more likely to give you referrals.
2. Be Direct When You Ask
Don’t beat around the bush when you ask clients for referrals. If it’s not clear that you’re looking for a referral, a client may give you something else (or nothing at all).
When you ask for referrals over email, adding a line to your signature that asks for referrals is not sufficient. There’s no compelling call to action with that kind of message. It’s also likely to be overlooked.
The more personalized the message, the stronger your referral strategy will be.
Reminding clients of their exceptional experience with you is important. Eighty-three percent of customers are willing to give a referral after a great experience, but only 29% do.
To capture more potential referrals, you need to directly ask clients if they’re willing to give a referral.
3. Ask Specifically
Apart from asking for referrals directly, you need to ask for them specifically.
Instead of asking if they know anyone who could use your product, you should ask if they know of one or two people who have X problem. Tailor the question related to your product and industry.
There are two reasons for doing this.
The first is that it’s easier for people to remember specifics about what you asked them. When you qualify “someone you know” with a problem or criteria, it’s easier for the listener to recall it later.
The second reason is that you’ll get better-qualified leads when you qualify your ask. If you ask for anyone, you could get anyone. When you say the person should have X problem, then you have an immediate in to fix the problem.
Being specific isn’t difficult. You know your product or service and the specific problems it solves.
4. Make Referring Easy for Customers
People are generally willing to help others as long as there’s minimal effort on their part. This is especially true when it comes to referrals.
To maximize your referral strategy, you’ll want to instill a mechanism that takes the effort out of referring someone to you. One of the quickest ways to do this is to craft a referral email. Your client can simply fill in the name of his referral and send it on.
Other ideas include adding a referral form to your website or writing a blog post that encourages referrals. You could also write Facebook posts and encourage your customers to share with their networks.
5. Don’t Stop Asking
Just because you’ve asked a customer for a referral before doesn’t mean you can’t ask again.
A lot can change in a few months. That customer might have extended his network or realized a colleague was having a problem your company can solve.
To bolster your referral strategy, set calendar reminders to follow up with customers to ask for referrals. It doesn’t need to be often. Every six months or so will do the trick.
You should also follow up with any clients who said they might have a referral for you. Send an email with a few details about your conversation and remind that person he mentioned a referral.
6. Thank Your Customers
Thanking your customers for referrals is vital to growing your referral strategy. You want them to become advocates for your business and continuously offer new referrals.
Apart from the standard “thank you” (a handwritten note goes far, by the way), you can say thank you in other ways.
If you have a large referral program, you could offer a standard reward like a bonus, gift card, or discount on a new contract. This will incentivize customers to provide more referrals.
Of course, you can still use those rewards for smaller referral programs too. It makes more sense to offer personalized rewards if you have a long sales cycle or a few large contracts.
7. Host Events with Customers and Prospects
Depending on your industry, hosting events can be one of the best ways to attract new sales leads and referrals.
To do this, you need to make the event feel exclusive. Ask a handful of your top clients to the event and request they bring one or two referrals.
The benefit of hosting an event like this is your clients will do a lot of selling for you.
Improve Your Referral Strategy Today
When you strengthen your referral strategy, you get more and better-qualified leads coming through your sales pipeline.
Those leads are easier to nurture and take less time to move through the sales funnel.
Would you like more information or coaching on how to improve your referral strategy? I invite you to get in touch to schedule a consultation today.