Using referrals to get new customers

Using referrals to get new customers

Which marketing tactic do you think has the highest return on investment? Inbound marketing? Email campaigns? PPC ads?

The truth is this: there’s a standout winner that can’t be touched by any other method. That winner is referrals. Referral sales require almost no financial investment, but they bring in very valuable warm leads.

Referrals Are Some Of The Most Valuable Leads You Can Get

Here are a few statistics from Social Media Today:

• 78% of B2B marketers say that referral programs generate good or excellent leads.
• 60% of marketers say that referral programs generate a high volume of leads.
• 54% say that referral programs have a lower cost-per-lead than other channels.

Why are referrals so valuable?

I saw a great sign the other day:

This sign perfectly highlights the most efficient and cost-effective way for you to grow your business and that is to use your undercover sales team – your most satisfied customers.

Your business can only properly grow when it does two things – keeps existing customers; and gets new customers. Whatever your business, it simply cannot survive on a series of one-off sales.

Turning customers into an undercover sales team

A recommendation from an existing customer is the best lead for any business. Truthfully, a referred lead is the most valuable lead you can get. Why? Because customers who have been referred to you will already have a high level of trust in you and are more likely to buy. Imagine if you had an enquiry from someone who said “My friend, Rachel, says you’re the one to call.” That, is the sound of a qualified, red hot lead.

To benefit from referrals though you need to be consistent in providing positive experiences every time you interact with one of your customers.

Wow them every time.

Provide great value (if you want some ideas on providing value take a read of Add Value and out-smart and out-sell your competition .) Then your customers will be much more motivated to talk to their friends or family about you. And that must become your promise or guarantee – that you will provide that same great level of service to your customers and whoever they refer to you – each and every time.

This promise is not to be taken lightly. It requires a strategy and a system to guarantee success. Look at your current system for getting referrals. Do you even have one? Do you have a referral strategy? Do you know what referred business you are getting? Can you identify customers who have been referred to you? Customers who referred their friends or family to you? Do you know the barriers to referrals? Could you set some targets and some goals?

A good referral system will give you an ongoing stream of pre-qualified leads wanting to do business with you. All that’s left for you to do is reinforce the positive thoughts and feelings the referral already has, deliver the product or service as promised and, if possible, exceed their expectations.

Give them something “extra”

Because customers who refer you are so valuable in growing your business and your customers, you may want to give them something “extra”, a thank you, for the referral business.

Think carefully about what kind of offer you could use, and remember two key words: motivation and appreciation. For example, when you refer a friend you could offer 15% off your next purchase or a tangible gift.

If you show your appreciation for your valued clients you’ll be rewarded with greater customer loyalty, while the snowball effect from the combined referrals from both happy original clients and their friends will hugely increase your number of new prospects.

The result? A growing undercover salesforce who’ll help increase your market share and sustainably grow your business.

Want some ideas about how you can introduce referrals into your business – book a quick chat here – because we are really good at ideas like these