How does a business in the Internet age take advantage of customer referrals? Read on for the 6 best practices to consider when starting your next customer referral program.
1. Communicate Directly
If you want your program to have a meaningful impact on your business, don’t expect your customers to look for it. Directly inform your customers about your referral program and how they can benefit from it.
2. Give Compelling Rewards
A referral program is only as good as its ability to attract brand ambassadors. Spend time figuring out what sort of incentives will mobilize customers. Should they be dual- or single-incentive? Monetary or non-monetary?
3. Don’t Focus on the Money
In your recruitment efforts, do not focus on the reward your customers will get for referring their friends. Instead, focus on the benefit your customers will be bringing their friends—either through a reward or through the benefits of your product.
4. Learn From Your Ambassadors
Once you have some active brand ambassadors, learn from them. Based on their activity, you can better understand who you should be recruiting to be ambassadors and what sort of rewards they prefer to optimize your referral program.
5. Start Compounding Ambassadors
When referred customers come your way, ensure that they get invited to be ambassadors. They are great prospects: they saw the value in your product and are active in whatever networks the original ambassador shared with. This makes outreach cheap and produces a feedback loop that grows your business.
6. Don’t Let Them Go Without a Fight
Ambassadors have a bad habit of fading over time. Be vigilant and track the activity of your ambassadors. If they start to disengage, take actions that will bring them back into the fold. It’s less work than finding a new ambassador and they can leverage their previous experience to be more effective.
Got Questions? Let’s Talk About Your Referral Strategy