How to Set Your Referral Program on Fire - Part 2

Referral Fire Starter Tip #6: Market Your Program Creatively

Once you’ve got the outline for a strong referral program in place, you need to start talking it up. If no one knows about it, no one is going to get excited about it.If no one knows about it, no one is going to get excited about it.
Here are some creative ways to promote your referral program:

1. Create a section of your website. Even if you are a bricks-and-mortar business, websites are great places to send people for more information. Have a section of your website that you can direct people to, and list all the referral details. Make sure there’s a form right there that people can use to refer friends and family.
2. Use the back of your business card. The back of your business card is prime real estate. Instead of letting it go to waste, use it to advertise your referral program. You could give details or just include a link to your referral program.
3. Create “refer-a-friend” cards. In addition to handing out business cards, give your customers refer-a-friend cards. They could say, “Someone really likes you, and thinks you’d like us! Use this card for 20% off your next purchase.” Then have a space for the referring party to include their name so they receive credit for the referral.
4. Use compelling language. Many cash-based businesses (real estate agents, mortgage brokers, etc.) will include, “I PAY FOR REFERRALS” on their marketing literature. If you don’t want to be that blunt, you could write something like, “Did you enjoy today’s service? Tell a friend and be rewarded. Check out our referral program at www.YOURSITEHERE.com.”
5. Create a direct mail piece just for referrals. Particularly if you are revamping or launching your referral program, you may want to think about creating a direct mail postcard specifically to promote the program to your existing customers. Highlight how easy it is to participate and the benefit to them – and their friends – if they participate.
6. Mention the referral program in person. When your customers are checking out or ending their transaction with you, remember to mention the program and ask for referrals.
7. Add it on all marketing materials. This mention can be as simple as a line that says, “Find out how you can earn free products! Go to www.YOURSITEHERE.com.”
8. Use Giveaways. Inexpensive giveaways like pens, mouse pads, and notepads are great places to mention your referral program’s URL. These items stay in front of them, and will keep your program top-of-mind. One note: Don’t give away junk! “Inexpensive” does not mean cheap. You’re better off investing a few more dollars in a giveaway people are going to want to use, then handing out junk that ends up in the trash.

Referral Fire Starter Tip #7: Make It Easy for Referrers

You can have the best referral program with fantastic rewards, but if it’s difficult for customers to use or understand, they won’t use it. Everyone is overwhelmed enough as it is; the last thing they want to do is to have to wade through piles of information or red tape just to send a customer or two your way.Everyone is overwhelmed enough as it is; the last thing they want to do is to have to wade through piles of information or red tape just to send a customer or two your way.
Here are some tips for keeping your program simple and user-friendly:

1. Keep the rewards simple. Don’t get too complicated with different levels of rewards or different rewards for different people. Keeping it simple and streamlined will make it easy for your customers to understand, and easy for you and your employees to implement.
2. Don’t give too many choices. More choice is not always a good thing. In fact, surveys show that when people are given more choice, it actually increases their confusion and reduces their satisfaction with their final selection. If you must give choices for redeeming referral rewards, keep it simple. Ask them to choose between two types of the same thing ($20 off a future service or $20 in merchandise credit, for example, or a t-shirt in red or blue.)
3. Have a variety of ways for people to submit their referrals. Asking people to go online to submit their referrals will cut down on the number of referrals you receive. Instead, take referrals in person, by phone, by mail, AND on your website. You may want to even let customers text the information to you if it’s more convenient for them.
4. Ask only for the information you really need. Everyone hates filling out forms, and the shorter your form is, the better. If you don’t need someone’s phone number, don’t ask for it. Keep it short and sweet, and remember you can always get the rest of the information when your referral becomes a customer.
5. Confirm when you receive a referral. Let your customer know when you receive a referral from them. An automated reply, “Thank you for trusting us!” is perfect. You can also make a note in the computer if you have a customer management system so the next person to speak with that customer can let them know you appreciate the referral.
6. Reward promptly. The only thing worse than never receiving the reward you were promised is having to wait months for the reward you were promised. Reward your customers promptly when they’ve earned something from your referral program. Positive reinforcement will increase the likelihood of a repeat performance.

Referral Fire Starter Tip #8: Moving It Forward

Once you’ve got a stack of names and contact information, you’ve got money in the bank, right? Well… maybe. Before you can start spending your new dough, you’ve got to convert those leads to customers. Here’s howBefore you can start spending your new dough, you’ve got to convert those leads to customers. Here’s how
to make sure that happens:

1. Check It Out. Your first step is to contact the referral. You’d be surprised at how often the contact information is incorrect. Sometimes, your customer has supplied a fake name in the hopes of getting their reward for nothing, or has referred someone who has absolutely no interest in your product or service. A good portion of your referrals will be weeded out at this point.
2. Explain. Even though you’re calling a “warm” lead, chances are that the preson you’re contacting didn’t know your mutual acquaintance passed on their contact information. You’ll want to explain how you got their name, and that you’ve got something special to offer them. Try something like, “Hey, Joe! Sally Smith gave me your name and number. She’s been a client of mine for over a year, and she thought you might be interested in the current promotion we’re running on bookkeeping services. Is there a time when I can go over our services in more detail and explain how we can save you at least 10 hours a month?”
3. Set a Time to Meet. If the referral passes the initial screen, you can set a time to chat further to explain your products or services, or to conduct an initial appointment if the referred person is interested. Remember, in most cases, the goal of the initial call is to get the prospect interested enough to want to learn more about you. Just as you can’t convert someone from a blind date to fiancée in one evening, you’re probably not going to make someone a customer for life in a single phone call. You just want to move them to the next step in the process.
4. Do Your Thing. Once you have the prospective customer interested, the next step is to do the thing you do best – explain your products and services to them. Emphasize how helpful you’ve been to your mutual acquaintance, and ask lots of questions. Begin establishing a relationship.
5. Report Back. Your customer will likely want to know how it went when you contacted their referral. Drop them a line by email or in the mail that says, “Thanks for referring Joe! We met last week. I truly appreciate your trust in me.” Then you can inform them how they can claim their referral reward. Short and to the point does the trick.

Effective communication at every stage of the process will smooth the way – communication with your new prospect, communication with your staff if they’re assisting you in converting a lead to a customer, and communication with your original client. Letting everyone know what’s going on and why may seem like overkill, but it really makes everyone feel like part of the process.Letting everyone know what’s going on and why may seem like overkill, but it really makes everyone feel like part of the process.

Referral Fire Starter Tip #9: Troubleshooting.

Even the best referral program can run into some issues along the way. Here are some common problems and how to address themEven the best referral program can run into some issues along the way. Here are some common problems and how to address them
:

1. No one is using the program. If you’re not getting any referrals, you either haven’t created a strong enough rewards program, or people don’t know about it. If you think the issue is with promotions, start mentioning your referral program at every opportunity. Add it to your regular mailing, mention it to all your customers, and consider doing a separate mailing to promote your program.
2. The referrals you receive aren’t interested. If you’re getting plenty of referrals but they’re not becoming customers, that means you need to increase the quality of the referrals you’re receiving. Make sure you let your customers know you’re rewarding based on qualified leads. You can also ask a qualifying question on the referral form to make sure your customers are thinking in the right direction. For instance, if you sell cosmetics, you could ask your current customers to list the product lines their friend currently uses. This simple question will make your customer think twice about writing down anyone and everyone, without regard to whether they fit your ideal customer.
3. You’re getting too many referrals. This shouldn’t be a problem unless the referrals you’re receiving aren’t qualified. Otherwise, most people wish they could be in your shoes – so overrun with business that you’re wondering how to turn off the flow.
4. Your program is too expensive. If it seems like you’re spending more money on referral rewards than they’re worth, there’s either a problem with your perception, or you’ve stacked the rewards too high. Most businesspeople know how much a new customer is worth to them in terms of business over the next year or years. Compare that amount to the amount you’re paying to your referrer. If each new customer is worth about $50 in new business over the next year, you don’t want to offer more than that as a referral bonus. If you are offering $100 credit for each new customer referred, no wonder it seems expensive – it is! Adjust accordingly.
5. Your program is taking too long to administer. If you’re spending hours each week administering your program, you need to simplify and automate. Create systems to help you track and reward your members, and streamline your process so it can operate quickly and easily. Cut out extra steps, get rid of things like punch cards and by-hand tracking, and make it all digital if possible. If that is too complex for you, a single index card with names and numbers of referred clients can work, too. Pick something that fits your style and remember that simple is best.

Referral Fire Starter Tip #10: What NOT to Do.

We’ve spent some time talking about how to fix some of the things that can go wrong with your referral program; now, let’s discuss some things you’ll want to avoid at all costs.some things you’ll want to avoid at all costs.
Any one of these pitfalls can sabotage your referral success:

1. Not following up. We talked earlier about the need to actually do something with the names and numbers you collect. If you don’t use them, it’s the same as sticking quarters in the ground and waiting for them to grow into dollar bills. You may think it’s too much work to call a dozen referrals in search of the one that says “Yes,” but sales is a numbers game. Each “No” takes you one step closer to the inevitable sale.
2. Not automating your process. Your referral process should run as smoothly – and as automated – as possible. If you’re collecting referrals electronically, there should be an automatic process for them to get forwarded on to the person who’s going to make the initial contact. Don’t let your referrals get bogged down at any point; a kink in the hose means a kink in your bank account.
3. Not keeping it simple. The more complex your process is, the more time and energy it will take to administer it. If you have to choose between keeping it simple or making it really cool, go with simple. Your referral program should be a money maker for you, not a resource swallower.
4. Not telling people about it. No one is going to go out of their way to take part in a program they don’t know about. Take every opportunity to let people know how they and their friends can benefit from your referral program.
5. Not paying attention to changes around you. If your customer profile is changing, or your market is changing, or the products and services your customers are demanding are changing, you need to be aware of that. Your referral program won’t rescue you from being behind the times in other areas of your business.
6. Not valuing referrals and treating them like gold. The highest compliment a customer can pay you is to refer a friend or family member to you. If they do and that friend has a bad experience, it reflects poorly on them. When someone sends an acquaintance your way, you need to go above and beyond to make sure that referral has a great experience. Not only will that make you look good, it’ll make the original customer look good, too.

Conclusion

As you can see, creating a strong referral program isn’t rocket science. In fact, the simpler your program is, the easier it is for you to administer and for your customers to understand.

But don’t be deceived by the simplicity; referrals are the lifeblood of any serious businessperson. Having customers who constantly feed quality leads your way is like having a sales force of hundreds of additional people – without having to pay them a salary or benefits!Having customers who constantly feed quality leads your way is like having a sales force of hundreds of additional people – without having to pay them a salary or benefits!

Keep the tips and suggestions in this article on-hand to make sure your referral program is as successful as possible. And when in doubt, go for the most simple solution you can design. That approach is sure to keep your program operating smoothly and easily.