Referrals from current and previous clients can bring in a lot of new business for your small business. It’s a less direct way to get word out about your products or services to prospective customers.
Generating referrals can be daunting to new business owners who don’t know where to start. Customer relationships play a role in generating referrals for your business. Sometimes, it can be difficult to ask someone to advocate for your business. This is especially if you don’t have a relationship with your customers.
Happy and satisfied customers are the key to your referral strategy. These are the customers who are usually excited to refer your business to their friends or other people they know. Therefore, keeping your customers happy and satisfied should be your priority if you want your referral strategy to be effective. Importantly, learn how to ask your customers to refer you to potential customers.
Why referrals? – Benefits
The main benefit of referrals for your business is the fact that you don’t actively do the marketing yourself.
Referral marketing lowers your sales costs and shortens your sales cycle. Your small business can spend less time cold calling prospects and more time focusing on customers and their circle of influence.
Referrals will help you increase the number of happy customers. The cycle continues as more happy customers refer others to your company. Importantly, your sales revenue will rise as a result of referrals.
How to get more Customer referrals
First, perfect your products or services
You must have something for people to speak about. No one will advocate for a product or service that is not good enough.
Your referral strategy will not work before you iron out your products or services. Focus on making sure your clients are satisfied with the service you offer, and only then can you consider referrals.
Determine who the ideal prospects are
Determine the types of customers that provide you with your revenue. The right target of people who will gladly pay for your products or services. What is their size, market, and demographics? What are the key issues they’re attempting to solve- their needs and wants?
You’ll need a system for easily identifying and qualifying referrals so you can figure out where you should concentrate your efforts.
1.Perfect time to ask
Most businesses tend to ask for referrals immediately after closing a deal. This tactic can put off customers.
Give your customers time to experience and enjoy your products or services. It’s more effective to ask for referral when a customer is happy with the work you’ve done.
2.Not all customers are referral candidates
Not every customer is a good choice for a referral. As a business, you know your customers. From your customers, choose a good percentage that is ecstatic with your business and ask them to refer you to other potential customers.
Importantly, check and see whether their network has your target customers. Their network starts with their friends and colleagues.
3.Have a reward program
Through referrals, you’re attempting to persuade your clients to seek out new business for you. While some people enjoy connecting others in their network, most people become so preoccupied with their own work that they fail to submit referrals. However, having a reward program will motivate them to keep making referrals for you.
On a regular basis, offer special incentives to your referring customers. If a customer makes five purchases, offer them something extra, such as a discount.
4.Share with your referring customers your right customer type
Inform your referring customers about the types of clients you can assist. Referral marketing can be aided if you have a good picture of the consumer demographics.
You probably even have your own customer bucket list. Your referral customers probably have connections to these customers. Therefore, informing them more about your customer type can help them reach out to the right customers.
5.Provide your referral customers with personalized content
Provide content that your referring clients may share with their consumers or business networks.
This also helps you to build that authority and trust with potential prospects even before they’ve been officially referred.
6.Say thank you
Prepare a thank you note that can be personalized and sent to each referral you get. Make your referral customers feel important and of value to you and your business. This helps build a foundation of trust between your business and your referral advocates. With this trust, there comes more prospects.
Word-of-mouth marketing generates efficient and cost-effective business referrals. To generate a steady stream of referrals, all you need are satisfied customers who feel compelled to tell others about their positive experience.