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Customer referral program

Written by: Russell Bowyer

Article Overview: There are many businesses that would argue their best source of clients is by referral and yet if you ask what they do about this ‘Best Source', most would also say nothing. Do you reward people for referring customers to you and do you have an organised program to encourage this form of referral? If you answered 'NO‘ to this question then I would ask you to take a moment to think about your answer for a moment and to perhaps discuss changing how you deal with this aspect of your business with your business partners and employees. Firstly, you could make a decision to reward those people that refer clients to you by way of a financial reward either with a cheque or a voucher. Alternatively, you could reward them with your own products or services, by way of a discount on future purchases or by giving items away.

Customer referral program

There are many businesses that would argue their best source of clients is by referral and yet if you ask what they do about this ‘Best Source', most would also say nothing. Do you reward people for referring customers to you and do you have an organised program to encourage this form of referral?

If you answered 'NO‘ to this question then I would ask you to take a moment to think about your answer for a moment and to perhaps discuss changing how you deal with this aspect of your business with your business partners and employees.

Firstly, you could make a decision to reward those people that refer clients to you by way of a financial reward either with a cheque or a voucher. Alternatively, you could reward them with your own products or services, by way of a discount on future purchases or by giving items away.

However, I recommend discounts, as this would encourage them to buy more product or service from your business, which is a ‘win-win' situation and best overall for your business.

Not only should you consider rewarding people when they introduce business to you, but you should also consider actively encouraging it so that people know beforehand that they will be rewarded for referring business your way.

The Internet has thousands of businesses that have been built in this way and are called affiliate businesses and you could even use this if your business fits that style of expansion, but if it doesn't then at least think about doing this on a smaller scale and a start would be to put details of your ‘referral program' on your website.

Related Articles
  Referral Program
  Frequent Referral Programs
  More on Referrals
  Stop Begging for Referrals
  When Good Referrals Turn Bad by Keith Rosen, MCC

Article Tags: business partners, cheque, customer referral program, financial reward, voucher



Related Forum Posts
Viral Incentive - One way I found extremely effective is by making viral reports that generate back end revenue for referrers. What I do is whenever I want to promote a site, I use Viral PDF to create a report for anyone to change their links to attach their referral IDs embedded within the report. They give away the report, and when new members are generated as a result of their referral, it helps them gain commission. For this website, there is something we all gain from. I haven't really paid attention to it since I have been here, but I believe Evan splits Google Adsense revenue with people who come to visit this site as a result of your referral. We can create a report, make the link brandable to whoever want to pass out with their referral IDs. I need to look into how the referral program worked one more time to configure it. But this way, it gives you the incentive to pass around the branded report because it's a soft-sell on your end. The key to make this successful is we need to come up with great, useful report. Things like helpful links, helpful information, collection of popular threads even work -- this is the hardest part of it all. We'll compile them into a PDF, I will sign them to add tags you can download to change them into your own IDs. That usually takes two buttons to push. Then let the visitors pour into the site. This is great because there are quiet observers in the forum that are seemingly inactive, yet visit the forum often. Even those people will feel compelled to spread the report. Regards, Takuya
Referral strategy - Hi Andy - here are some of my thoughts: 1) It could work depending on the demographic. Sometimes incentives work very well to generate referrals and other times they don't. I remember when Intuit announced a cash referral program for their customers. The reaction was not positive. Customers said they are happy to refer their friends on because they loved the product and did not want to feel like they are "selling" their friends. Others, however, love being affiliates and base their entire business on this type of model. Test it and see the reaction. It may work out and it may not. It will probably be a nice add-on but I wouldn't rely on it as my main marketing strategy. 2) Why limit it to 2? Like any other community you're going to have people who really take to your idea and others who won't. You want to create champions of the customers who refer so why limit it to 2? Providing an ongoing revenue stream to your referral partners is a great way to bring in new business. 3) I agree about them paying up front first. By "credit" do you mean he'll be paying them $300 cash or does it go towards other products / services he is offering?
Re: Two Useful Books To Help You Focus On The CLIENT - Hi David, To add to your thread, I'd like to recommend Jonathan Tisch's "Chocolates On The Pillow Aren't Enough: Reinventing The Customer Experience". Tisch's book includes content on "Welcoming Customers", "The New Art of Customization", "The Challenges of Customer Diversity" and "Offering Something Extra to Your Customers" to name a few.
Looking for Mentor - referral directory / reward program - Hi all, Hope all doing well. I am in the process to start a new internet based business referral directory aligned with a local community development reward program. Ideally, I am looking for a successful entrepreneur with some back ground on business directory and/or reward programs. Looking forward to hear back for the forum, AM
Re: Need your opimion-tested this new opportunity - Hi Betty, Welcome to the forum. I never heard about this program, and I am glad it works for you. My advice to you is never join a program you don't know before asking about it and doing a complete research. If the program is good, you can wait a day or two.


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