How To Build The Best Referral Program For Your Business
Did you know that word of mouth generates 5x more sales than paid advertising and that people are 90% more likely to trust and buy from a brand that has been recommended by a friend? What marketers or business owners tend to overlook, however, is that word of mouth doesn’t always have to happen completely organically. But with a little strategy, you can encourage your customers to spread the word.
And how are you going to encourage them to be your brand advocates?
Let’s dive deep into it and find out how businesses can benefit and make use of a referral program.
Benefits of a Referral Program:
Levarage on your existing customers
With a referral program, you can reach audiences you may not have access to and generate a high volume of leads. When a customer shares your referral program on social media, or emails, or even via SMS, all of their friends immediately become aware of your brand and trust. If some of those friends become new customers, there’s a good chance they’ll also share the referral program with their own friends on social media and thereby increase leads.
Increases highly qualified lead quantity
A referral program is one of the most trusted forms of advertising. It generates not just random leads, but highly qualified leads that are more likely to result in a sale. The leads you acquire are more likely to remain loyal customers.
Cost effective
A referral program is way cost-effective than the usual ads. You’re not only spending less money but also less time on customer acquisition, and you’re not targeting complete strangers with ads. Rather, you’re targeting your existing customers who have already built a positive relationship with your brand. These loyal customers will promote your business for you at little to no cost so you don’t have to spend nearly as much on the usual ads.
How to Implement a Loyalty Program
Keep it straightforward
If there is one thing you have already learned in building a business, it is this: Never make it complicated for the customer. That is, when a business introduces a referral program, it should clearly state what actions it expects the customer to take, such as “refer a friend” or “invite a friend.” It is important to also state the terms and the steps to incentivize the completion of the required actions. Your goal is to make the process of referring new customers and receiving their rewards as easy as possible.
Make social sharing easy
In the age of digital, businesses should take advantage of the quickest and the easiest mode of communication. While implementing a referral program, make sure that the program is sharable on social platforms. When you integrate social sharing into your referral program, you increase your impact! If you’ve created a significant incentive for customers, give them a reason to spread the word.
Offer cost-effective yet valuable incentives
You must understand that in today’s world there is no getting without giving. Therefore, you also need to come up with a plan for offers you want to make to your referrers. While planning, you need to put yourself in the shoes of your referrers and think about what value you can offer them to motivate them to pass on the word of mouth.
Promote Your Referral Program
Now that you’ve created a loyalty program, it’s time to promote it, because without knowing about it, your customers could be missing out on an opportunity to benefit from this referral program. You can also ask for referrals right after the first few sales, although this may sound weird, trust me, it works! Because the customer will be excited about your product or service at that point, and it’s always better to strike the rod when it’s hot – a perfect time to ask for a referral!
Companies that create referral programs can track their brand advocates, encourage satisfied customers to promote their product and increase both customer acquisition and retention. A referral program does indeed work, and it adds a growth channel to your business that can provide a new revenue stream for your company.
Time to make your referral program a reality!
Understand that you can create a referral program manually if you are a web developer or marketer, but creating it yourself could be a daunting task. Fortunately, there are already a number of tools in the market that take this complicated process and make it intuitive.
Poket is one of the most popular referral programs that make signing up, tracking, and rewards easy to manage. It’s easy, simple, and intuitive – exactly the kind of program you want if your focus is on making the process as navigable as possible for your customers.
