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.