Building a Referral Program

May 06, 2021

One of the most powerful forms of marketing is word-of-mouth referrals. Oftentimes, word-of-mouth recommendations will happen organically. Naturally, people who have liked a service you provided will go on to tell their circle about your business. If you want to encourage more referrals or add structure to the word of mouth marketing already taking place, it might be time to introduce a referral program.

What Is a Referral Program?

A referral program is a way of harnessing the power of word-of-mouth recommendations by encouraging and incentivizing brand advocates to spread the word about your business to generate leads.

This form of marketing is especially effective as the recommendation of your services and offerings are typically coming from those who have had a positive outcome working with you and have vetted the experience. Statistics show that a high majority of people trust word-of-mouth recommendations and that it remains to be one of the most common business methods to gain exposure for new offerings and promotions.

Here are 6 considerations to keep in mind when introducing a referral program into your marketing strategy:

1. Understand Where Referrals Are Coming From

Are people already being referred by others to work with you? As a starting point, you may want to consider where referrals are coming from. Who is promoting you and where are people sharing their experience? This will help you strategize all the other details when putting together a referral program.

2. Outline the Structure of Your Referral Program

What are the terms of your program? Choose whether you want to incentivize both sides of the referral, such as a discount for the person being referred. What can be promoted to encourage people to reach out to work with you once they’ve learned about your business through word of mouth? Your referral program should be easy to understand and put into action. Think of a simple, clear call to action that promoters can share, such as creating a coupon code to share with their community. Example: Use my coupon code for 10% off a 6-month package.

3. Identify How You Want to Incentivize Referrals for Promoters

Common incentives include monetary rewards, service discounts, or even physical products. Whatever you choose to incentivize with should resonate with those spreading the word about your business. Keep in mind how you plan to deliver the incentives to those sharing their experience, as this can influence what you decide to incentivize with and how you’ll need to keep track of referees.

4. Establish a Way to Keep Track of Referees

This can be kept simple, such as a targetted question on an intake form asking who referred the new client to you, or a more robust program such as PartnerStack. Ultimately, the goal is to understand who’s referred who and what incentive needs to be delivered. To decide which is a better fit for you, consider what type of services you’re hoping your advocates promote. Are they promoting services, physical products, or digital products? Also, consider what volume of referrals do you anticipate coming in, as a higher volume may constitute the need for a more robust managing platform.

5. Reach Out to Potential Referees

The best way to put your referral program into action is to share with those that can help spread the word. You can keep it casual by mentioning your referral program to clients during check-ins via Practice Better Secure Chat, share it as the next steps when collecting final feedback, or broadcast it out to your list of clientele within the platform. If you want to open up the program to beyond just those that have directly worked with you, think of where your brand advocates may be spending time online. This will give you an idea of where else you can share the details of your referral program to help generate more leads into your business.

6. Create and Share Resources

When introducing a referral program into your business, you’re essentially allowing for someone outside of your business to be a voice for your services. You can have more control over the messaging by providing resources such as swipe copy, graphics, terms and conditions, and even personalized links or coupon codes for services you want to focus the promotion on. The goal of these resources is to make it as easy as possible to begin promoting in a way that allows you to maintain a consistent image and brand messaging.

It’s likely that clients who’ve worked with you are already sharing the word about the experience you provided. Word of mouth marketing remains one of the most influential and trusted forms of advertising for a business. Introducing a referral program will allow you to understand who your brand advocates are, incentivize them and generate leads into your business through them.

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