Tips for a Successful Refer-A-Friend Program

When someone is in need of a specific product or service, this individual often asks a family member or friend for a recommendation. In some cases, a person might instead go through online reviews to decide what to buy or which company to support.

A referral occurs when one person tells another to check out a particular business. Word of mouth can help businesses of all sizes in any industry. Having a refer-a-friend program is an excellent way to bring in new customers.

Even if you already know that this kind of program can be helpful, you might be wondering how to implement it for your company. The good news here is that the sky is truly the limit. There are tons of ways to structure your refer-a-friend program to ensure customers want to sign up all their friends. We’ll be sharing a few of them below to give you some inspiration to use while you hammer out your own platform.

Implement Giveaways or Customer Contests

When you offer a contest or give something away, it can push customers to provide you with new leads. A contest could be set up where referring a certain number of friends is required to win. This can be anything from getting several signups for a beta or membership or providing lists of potential customers’ emails.

Make sure the contests you run prioritize referring high-quality leads. This can be done if you base the entry on conversions instead of the number of referrals. Rather than handing over emails to enter, a customer would need to convince friends to use your product or service. This rewards customers for bringing in leads that will convert.

Try Setting Up a Fundraiser

A fundraiser is another excellent option to get refer-a-friend off the ground for your business. It lets you connect without specifically involving your services and products. People who are interested in the cause you are supporting will see you as more than just another business. It shows that you have the same values as the potential customer.

Fundraisers also make a great way to bring in referrals since customers can share the fundraiser with their friends. As additional people participate and donate, you’ll create a database of leads who have the same values as your brand. This gives you an in to start communication with the leads. Once the time seems right, you can move that conversation in the direction of the products and services you provide.

Create Campaigns by the Season

Are you planning to start your refer-a-friend program near a holiday or other special day? If so, a seasonal campaign can boost the referrals that come in to you. New customers can see annual sales, discounts for holidays, and other long-term deals that can be used no matter what season it is. If you get in the groove and start having these campaigns on a regular basis, customers will look forward to them. This is a great way to keep a captivated audience and bring in new leads.

Consider Referral Discounts

Some customers will respond best to a return on their referrals, which you can give them in the form of discounts based on the leads they bring to you. Since it’s more expensive to acquire leads than to keep them, the money you spend on the discounts will be easily made up if you manage to convert the leads that are sent your way. Sometimes you have to spend money to make money, and this is one of those examples.

Host Exclusive Events

Everyone loves to feel special and nothing is better for that than offering an exclusive event to someone. When you host events that only members of your refer-a-friend team are allowed to attend, it can bring in new leads and make your existing customers happy.

One option is to choose an event and then hand out extra tickets so your customers can invite friends along to learn more about your business. Rather than having them come to your store, the event can be something more casual and less focused on selling your products and services. For example, let members of your refer-a-friend team come to a company event where there’s far less pressure than visiting your store.

Introduce Loyalty Levels

While it can be fun to offer contests and fundraisers, it’s also a lot of work and not something that can be done every week. A more efficient option is to make your referral program set up so that customers are motivated to introduce new people to your brand time and time again as months and years go past. This can be done by incorporating loyalty levels that reward customers as they refer and move up.

Every tier in the program needs to be unique and have special benefits so that customers want to continue moving up the ranks. With this sort of refer-a-friend option, customers will continue to be motivated to bring in new leads. There’s no need to have promotions or contests as often when you choose this method.

Get Involved with Social Gifting

Keep in mind that customers are much more likely to offer you referrals if it doesn’t feel like they’re being manipulated into it. For example, when you send out an email that says something like “refer three people and get 10% off,” customers are fully aware of what you are trying to get them to do and may be less likely to follow the instructions.

Rather than using the method mentioned above, try an offer that rewards current customers for sharing a coupon instead. The customer gets the chance to offer something nice to their friends and gets a reward when the people they know redeem the offer. This is an excellent way to reach out to more people quickly.

A refer-a-friend program is a great way to bring in leads and create new customers but using some of the tips above will ensure your success. Try out the opportunities that stand out to you and see where they lead you. You might be surprised how much they can improve referrals!

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Steps to Create a Customer Referral Program

One of the best possible ways to bring in new customers is by ensuring that your existing customers are advocates for your products and services. When you have a group of customers who love what you do, positive word of mouth can significantly benefit your business. Think about it for a moment. Are you more likely to trust a stranger about a product to meet your needs or a friend?

The main issue with word of mouth as advertising is that a business can’t completely control it. You have to trust your customers to pass on exciting information about what you do. And that might not be as easy as you think. Even offering excellent service doesn’t mean that referrals will happen. That’s why having a program specifically for customer referrals can be such a good idea.

Why to Build a Customer Referral Program

There are several great reasons to implement a customer referral program for your company. It can help you retain your existing customers. It lets you reach your revenue goals. It also gives you an option to grow your business. Merely having a referral program is useful since it shows that you believe in your company enough to think a referral program is an excellent investment. It also shows that you know some customers aren’t going to refer others unless there’s a good reason for them to.

The reality is that customer referrals are highly valuable since it costs little to nothing to bring in those new customers. Even if you invest money into the process, it’s worth it. Not only do you get someone new as a customer, but once they realize how great your business is, they may refer other people. It’s a never-ending cycle that can be a fixture of any marketing plan.

Setting Your Customer Referral Goals

You wouldn’t be researching customer referral programs if you weren’t interested in the idea of them. So, now is the time to think about why a referral program is something you want to have. Do you want retention? Are you interested in revenue and growth? Do you work in a sector that requires more trust than others? Determine what your goals are before moving forward and the entire process will be more straightforward.

From that point, it’s essential to decide how referrals are currently reaching the business. Talk to the support team, marketing workers, and sales management associates to determine how referrals have been dealt with in the past. This will help you see where you are currently and how you can build off of it.

List Referral Sources and Reach Out

Find the people who might be interested in bringing you referrals, whether those are people you’ve connected with in the past or people you see a lot of right now. Make a list of those individuals. It can include past customers, current customers, industry leaders, unclosed leads, vendors, and more. Having this information gives you a base to start from.

After you have your list, whittle it down to the best contacts. These are the people who know the value you offer and are likely to refer even without an incentive to do so. Next, choose the right time to speak to those people. Think about whether this should occur early or late in a relationship and then act on that knowledge. Ask for referrals and wait a while before doing it again.

Decide on Appropriate Incentives

Incentives are an excellent way to bring in referrals, but not all programs use them. The best customer referral program will have several options and use different ones for specific contacts. Break down your list into levels and then determine what incentives are appropriate for each of them.

There should also be something good for the referrer, so they’re more likely to refer repeatedly. Consider large restaurant delivery companies as one example. Many of them offer free delivery or meals to those who are referred, but the referrer will also get a credit for a certain amount of their orders to make the referral worth their time.

Alerts Your Customers About the Program on a Regular Basis

Once your referral program is up and running and you have incentives that you think will, the next step is to let your customers know about it. Promotion is key to a customer referral program that works. Consider all the different ways you can promote the program beyond just an email campaign. Some ideas include:

  • Blog posts
  • Newsletters
  • Email signatures
  • Product updates

After you have the programs outlined, make up resources for each of them. For instance, you should have emails for each contact to explain the program. Add a message that explains which customers are the best fit for your company. Consider a landing page where contacts can input their friends’ information, a workflow that takes contacts through the system, or even scripts for customer support teams to use.

Get to Work on Tracking Referrals

No matter how small or large your company is, tracking needs to be used to make the most of customer referral programs. Several things should be tracked throughout the life of the program.

  • Who referred people and which people were referred
  • On what date referrals occurred
  • Whether the people referred bought items or converted
  • How those referred are followed up with

Custom relationship management (CRM) software can make this a breeze. Customer success relies on keeping track of your relationships, so this step needs to be followed. It lets you individualize each person who works with your business, which will make them feel more connected.

Show Gratitude for Referrals

Make sure that you tell the referrers how grateful you are for helping you. This can be done through incentives but messaging them a quick thank you is also vital. You should also reach out to the referred person to thank them for joining. Once that’s done, it’s time to start wowing all the customers so you can keep building your business!

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7 Methods to Improve Your Referral Program

While lots of businesses focus on other sorts of marketing, word of mouth can’t be discounted. It’s a powerful tool for a company in any industry. As new technology builds and additional platforms come alive, businesses can now leverage word of mouth marketing through referral programs. Even if you already have one set up, you likely appreciate knowing how to make it even better. That’s what we’re going to be focusing on today.

Choose the Right Rewards and Discounts for Your Audience

When you’re offering a reward to customers who refer others, incentives can be a huge help. The only issue is choosing between discounts or money. The answer isn’t as simple as one being better than the other on all occasions. It all depends on your customers and what their needs are.

Do customers tend to make many purchases? If so, a discount could convince them to make larger purchases. On the other hand, those who don’t make frequent purchases might appreciate a cash reward more. This can get them to show interest in your customer referral program.

There are also situations where companies take preorders but offer discounts on them. This can be an excellent way to get leads into the program that might bring in additional customers. Whatever you decide to go with, make sure it’s right for your customers.

Make Referrals Simple to Do

This one might seem like common sense, but it’s worth spending a moment on. Your current customers will be much more likely to refer people to your brand if you make the process easy. Nobody wants to spend extra time providing referrals, so you need a streamlined process that takes as little time as possible out of someone’s life.

The top way to do this is by making sure your referral program has several sharing methods. Social media marketing activities and emails are the two most common options for bringing in referrals. However, you also want to be sure that you have some way to track the offline referrals that occur. This ensures that all your customers have an incentive to bring you additional business.

Choose the Right Discount Amount

When it comes to discounts, you can choose between a flat amount or a percentage. There’s a lot of debate about which of these options works best, but it really comes down to what service and products you provided. If most of the things you are discounting are quite expensive, a flat discount will sound more exciting than a percentage.

However, the opposite applies when you’re selling less expensive options. For instance, if you’re selling a t-shirt for $30, a 20% discount is going to look more appealing than a straight $6 off. It’s the same amount regardless, but 20% seems like a much larger number to most customers.

Ask for Referrals at the Right Moment

Knowing how to ask for a referral is important and nobody denies that. However, it’s also just as important to ask at the appropriate time. In most cases, customers are most likely to become your referral program members right after they’ve purchased something. It puts people in a positive space to buy something new, making them more likely to refer their friends to your business.

In truth, this isn’t as surprising as it might seem. If you have an excellent funnel that makes a customer out of a site visitor, the new customer is going to be in the right mindset to go farther by sharing your business with family and friends. Consider adding a call-to-action for your program on the thank you page and the email receipt for the best results.

Reward Both Referrers and Those They Refer

You want to reward your customers that refer other people to your business, of course. However, it’s also important to offer rewards and incentives to the people who are referred to you for goods and services. For example, you could choose to send out a discount coupon to both the person who referred a friend and the new potential customer.

There’s a second reason that this is such a good idea. Sometimes people are nervous and ashamed of sending referral codes out to friends. However, if both parties are getting something out of the situation, it’s more exciting to share that information with a friend. It also makes it more likely that the referred person will become a customer and might refer others down the line.

Pay Attention to Data and Analytics

The people who are part of your referral program are those who you want to keep motivated to refer additional people. One of the best ways to ensure this happens is by offering information showing how well they’ve done over the last year or six months. Having a referral dashboard that customers can visit to track their milestones can assist with this.

Not sure what kind of metrics you should post for customers to see? Consider showing how many people have signed up based on their referrals, how many referral emails they have sent out in total, and how much of a discount or a cash value they have earned by participating in the program.

Start Things Off Soft

You don’t have to start out rushing to get signups for your referral program. Sometimes going slowly is the better option. Consider sending out a questionnaire with essential questions. Ask how the customer feels about their experience with your company and whether they would be interested in referring you to their friends in the future.

After a customer has decided they enjoy your brand and what you bring to the table, that’s a great moment to share a referral form. At that point, customers can enter an email address for their friends. It’s as simple as that to make their first of what might later be many referrals.

Having a referral program is a great way to use word of mouth to bring in leads for your company. Use a few of the tips above to ensure your program offers what customers want to see. You might be surprised by how much of a difference it can make!

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Grow A Successful Insurance Referral Program

Looking for new clients? You’ll find them through the satisfied clients you’re currently serving.

Whether you’re in the initial growth stage of your insurance business or are a well-established local agent, lead generation probably takes up the majority of your bandwidth each day. After all, in order to keep your business growing, you need a steady influx of new clients. Rather than going out and finding them through advertising or cold-calling, why not leverage the satisfied, enthusiastic clients you already have through a customer referral or Refer-a-Friend program?

Why are customer referrals superior to other lead gen strategies for insurance agents?
There are so many lead generation and marketing systems being advertised to professionals in the insurance industry, from the old-fashioned to the high-tech. Why should you spend the time and effort to develop a customer referral program for your insurance business? Because it is by far the best option for high-quality, high-converting lead acquisition. Here’s why.

Lower Acquisition Cost
In order to acquire a lead through online or print advertising or through direct mail, you’ll probably spend hundreds, if not thousands, of dollars. Most of that money will go to waste since you will only be targeting by zip code or by broad demographic factors. You won’t know who actually needs your services — you’ll just be guessing and hoping that occasionally your advertising arrow hits the bullseye.

By contrast, a referral from a satisfied customer comes in at little or no cost. Generally, the referral will be for someone who currently needs the services you provide and is in a position to move forward and seriously consider your offer.

Build Instant Credibility
When a current client refers a friend or colleague to you, they create a halo of credibility that follows you throughout the conversion process. After all, the logic goes, they wouldn’t refer their friend to you if you weren’t a competent, reliable professional who can help their friend or family member achieve their goals. That means you spend less time convincing the lead to work with you and more time finding out how you can best help them.

Generate Warm Leads
The leads you get from advertising or cold calling are, well, cold — it’s right there in the name. Even if you can get in touch with one of those cold leads, you have to spend time, effort, and, often, more money to convince them to work with you. You have to spend time warming them up and building trust in order to convert these cold leads. A client referral, however, comes to you warm from a happy client who has been singing your praises and saying that you’re the ideal person to help them with their insurance needs.

Superior Return on Investment
An investment is about more than money — it’s about time, effort, and energy. Think about all of the ways you invest in converting a cold lead. Money spent on follow-up advertising, time spent on follow-up conversations and lead nurturing, effort and energy devoted to convincing this lead that you can actually help them. Now, think about how easy it is to convert a lead when they have been sent to you by a trusted friend or colleague. They come in ready to work with you, which means you spend less time, money, energy, and effort converting them into a client.

Similarly, it can take weeks or months of steady lead nurturing to close a cold lead, while a warm lead from a referral may be ready to sign on the dotted line after the first follow-up phone call or email. That fast closing process makes a difference in your business operations, in your time spent on lead generation, and in your potential profitability.

How can you generate more referrals?

Of course, many people pursue referrals in a half-hearted way. They may put a message in their email signature that says, “I’m never too busy for your referrals!” They may drop a hint in their conversations with clients and members of their sphere of influence (SOI). They may even occasionally post a referral incentive on their social media platforms: “The first referral this month wins a Starbucks gift card!”

In reality, however, these lukewarm attempts at referral sourcing generate lukewarm results and may even make you look a little sad and desperate. What you need is a professional, purposeful, and organized process for generating referrals and rewarding the sources of those referrals. You need a plan for a customer referral program that pays dividends month after month, year after year.

How can you create a customer referral program?

A customer referral program has a number of moving parts and, at its best, has a lifecycle that takes into account a pre-referral process, a follow-up process, and a reward process. That way you can ensure that you are properly incentivizing referrals and nurturing them once they come in.

Promote your Refer-a-Friend program
In order to get started, you’ll need to promote your Refer-a-Friend program. You can do this through a number of channels, including the following:
● Social media posts
● Email newsletter or announcements
● Direct mail to members of your sphere, including current and former clients
● Website or landing page
● Existing advertising channels
● Invitation letters to clients
● Email signature link
● Business cards

You may want to brand the program for more impact with a unique name, logo, and other graphic elements. Spread the word about the program consistently so that it doesn’t look like a one-off, temporary promotion — it looks like a core channel for marketing your business.

Develop the program criteria
You’ll want to spend some time developing the program, including the way it will work, who will qualify, what types of rewards you’ll offer, and how you’ll determine who is rewarded. You may want to keep things exciting with variable tiers for rewards, according to the number of referrals a client sends your way.

Outline the program criteria on a webpage or landing page or in a disclosure statement on your direct mail or email promotion. That way, everyone will be clear on the rules and parameters for the referral program.

Capture lead information
You’ll need to determine how you’re going to capture the leads that are being sent your way as part of the program.
● Will you use a dedicated email address just for referrals?
● Will you have a separate phone line or some other way of differentiating between these leads and those that you are getting from other sources?
● Will you require specific information in order to verify a referral for reward purposes, like the lead’s email address and phone number?
● Will you put referrals into your general CRM for follow-up or create a dedicated category for leads that come in through your referral program?
● If you are part of a team, will someone in your organization be creating a central clearinghouse for referrals that come in through the program or will each agent nurture his or her own leads?

Creating a process ahead of time helps you make better decisions when those first referrals begin hitting your inbox. That will make both your follow-up and conversion process more efficient and effective.

Reach out for an initial consultation
You’ll want a way to reach out to new leads quickly in order to maximize your chances of converting them into clients. After all, if they’re being sent your way, it’s probably because they are in the market for the insurance products and services you offer. A fast follow-up is essential so that you can be the first and only agent on their radar.

Make sure your process includes a clear way for you to connect with your lead for that all-important first phone call, Zoom call, or in-person visit. If your assistant or a junior associate set those appointments, make sure that they are on top of their notifications. If you’re following up via email initially, ensure that your CRM or email platform has a well-planned drip campaign in place so that you can easily generate that first contact.

Follow up until closing
You may have an auto-generated email campaign in place or you may personally email and call your leads. Whatever your follow-up process, implement it consistently across a variety of channels in order to maximize your chances of closing that new client. You may want to use your standard drip campaign for ongoing, long-term follow-up or you may want to create a new one that takes into account the source of the lead as a satisfied client.

Reward the referral source
One of the things you will determine when planning your referral program is the basis for rewarding your referral partners. Maybe you’ll send one reward for leads and a larger reward for conversions. Maybe you’ll send increasingly valuable rewards according to how many friends your referral partners send your way. Whatever your reward strategy, make sure that you have a fool-proof plan in place to ensure that they receive acknowledgment and the appropriate reward in a timely manner.

Leverage referrals for marketing
As you implement your reward program, you can also use it as the basis of your marketing, review, and testimonial strategy. After all, you now have a whole new group of satisfied customers who not only value your as an insurance agent but appreciate the generous rewards that come from your referral program, as well.

Seek out testimonials and reviews from your most enthusiastic clients and share them on your social media channels, on your website, or on a professional portal that features your profile. Create graphic cards to share with the best quotes from your happy clients and send them out in an email blast to encourage other clients to participate in your Refer-a-Friend program.

Track program effectiveness
One of the most important things you’ll do is track your progress to determine how well your program is working. Keep an eye on the following elements in order to ensure that you have a clear picture of the various aspects of your plan:
● Track the number of clients you’ve contacted about the program
● Track the platforms and channels you used to contact them
● Track the way referral partners heard about your program and responded
● Track the number of leads generated by the program and by each partner
● Track the conversion rates for leads generated by the program and by each partner
● Track the rewards that went out as well as any subsequent reviews and testimonials

While this may seem time-consuming, it is an important way of ensuring that your program is working effectively. It will help you determine what communication and marketing platforms are most effective in reaching your audience and inspiring them to participate. It will help you determine your cost per lead (CPL) and compare that to the cost of your other advertising and lead generation programs. Finally, it will help you determine which rewards are most incentivizing and effective and whether you should expand your program or change it up.

Final Thoughts
An effective referral program offers an efficient and cost-effective way of bringing in new leads and nurturing them for quicker conversions. It also gives you a way to stay in touch with your current client base and show your appreciation for their ongoing support and the value they add to your business.

While a Refer-a-Friend program is unquestionably effective and useful in growing your business, be conscious of the need for consistent and professional implementation during the planning, lead nurturing, and reward phases of the program lifecycle. All of these should be optimized for maximum effectiveness and tracked for continuous improvement and increased efficiency.

If you’re looking to add the power of a fully integrated Refer-a-Friend program to the marketing plan for your insurance business, GrowAllies is the solution. We offer a full-service program for referral capture, follow up, conversion, and analytics so that you can put referrals to work as part of your lead generation strategy. Take advantage of our turnkey start-up and 14-day free trial and let GrowAllies help you reach out to your most valued clients more effectively.

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