Why You Need a Referral Program This Year 

18 Jan Why You Need a Referral Program This Year 

Remember the days when people learned about new businesses through word-of-mouth advertising? If a good friend spoke highly of an establishment, you as a customer were more likely to give it a try, rather than if you only heard the name through a commercial. 

A referral program is a new way to do something old and trusted. It’s essentially word-of-mouth marketing with rewards for the people who send new business your way. Offering prizes, discounts, special deals, etc., for people who are willing to speak up on your behalf and can get a result. It also helps your company get more bang out of each advertising buck by encouraging customers to do some of the work.  

Here are some reasons why it’s worth it to implement a referral program:

1. People trust their friends more than commercials.

This is true for business as much as anything else: the advice or suggestions from people we know and trust are worth more than the same advice or suggestions from strangers. We know commercials are trying to sell us something, which is why so many people skip through them when they have their favorite show recorded. But if a friend mentions a product, service, company, or store, we’re more inclined to listen and pay attention. If we treat our customers well and give them a positive experience, they will tell their friends and, hopefully, those friends will want to check things out. It’s also getting harder to reach people online via advertising, as up to 30% of online shoppers are using some ad blocking software on their browsers. 

2. There’s a low barrier to entry.

People are very used to being asked for their email address, phone number, or other contact information. A referral program takes this to the next step and gives the customer something in return. Sign up for our email list and receive a percentage off your next purchase! It’s that simple. Incorporate social media — a discount for following a company or brand on Facebook, Twitter, Instagram, etc. is another point of contact to provide a great experience for your customer and show them what you can offer. 

3. It’s an opportunity to remind customers why they interacted or shopped with your company in the first place.

The simple act of sharing the story of a good experience helps a customer remember why they were happy with your company in the first place. That positive experience can spread enthusiasm for your company, possibly inspiring the original customer to come back for more — maybe with friends. Even asking for feedback from customers is a way to nudge them to remember when your company met their needs in exactly the right way while also allowing them to provide feedback and make them feel valued. 

4. Increased customer engagement draws more eyes to your company.

People live on social media. It can be expensive to market there through targeted ad campaigns, but customers who follow your accounts might share posts, putting your name in front of more people, all without costing you much. Each happy customer who posts or comments online opens the door for their friends and followers to learn about your company and possibly become customers themselves. 

5. Referral programs encourage repeat customers.

If people know they’re going to get rewarded for doing business with you, they’ll be more inclined to be loyal. If they can earn points toward something they want with every purchase or that they’ll receive discounts or cashback, they might find excuses to increase their transactions. People want to get something for what they give. Whether it’s exclusive offers, early access to sales, bonus points, or credits on certain days, anything that makes them feel special and valued for their loyalty will help drive your business. 

Star Your Own Referral Program

Interested in starting your own referral program? Contact LeadingEdge Personnel today. We work with some of the country’s leading companies and have experience building referral programs that are guaranteed to drive your business. Call us today, and let’s get started!