As a marketer for the last 13+ years, I have done lots of types of marketing in lots of different industries. Some programs are industry specific and some things aren’t. Referral marketing programs consistently generate results for any organization in any industry. From healthcare to manufacturing, start-ups to established organizations: referral marketing should be a core component to your marketing plan and programs. Referrals impact: the value you bring to your customers by influencing your reputation, your business scope and your bottom line.
A Great Referral
Think about how you have used referrals in the past: restaurant, vacation spot, doctors, websites. More than likely you have tried the following 2 step process:
1. Find out if the referrer has actually USED that product or service.
2. Take the word of mouth referral and then done the research yourself. This is where SEO comes in handy. Go to the organization’s website, read customer reviews, check out forums and other unbiased reviews of the organization. This is confirmation that the business or organization does what it says it will do.
I saw the following comment on this blog post and thought it summarized the importance of referral marketing and its worth quite well. The true value of a referral can be calculated in many ways. The easiest way is by using this example:
Most business owners would probably agree that out of every 10 “new customers,” they will probably pick up a couple of referrals which means an additional 20% more in business.
If those 10 new customers came in and spent, $100 each, that gives the business a $1,000 Gross Sales Net. Now if you tie in the value of a referral at an additional 20%, then the business would add another $200. Giving the company a Gross Sales Net of $1,200.
Referrals are the most powerful form of marketing that you can use and it’s also the least expensive.
Getting referrals started for your organization is simple. Put yourself in the minds of your customers: Do your customers know that you encourage referrals? Do you have tools set up on your website or on social media for them to easily refer you and your business? Check out what others are saying about you. Get these elements in place before you start a marketing referral program. Then simply as k your customers to refer you. Find your most passionate customers and ask them to refer their friends to you if they are looking for your service. It is amazing how many organizations don’t ask for referrals and endorsements of work. A quick mention during a conversation with your customers or even a well-placed testimonial on your website can highlight you are open to additional business. And make sure everyone in the organization feels empowered to recommend you to others. After these elements are in place, you can create a more elaborate program.
Don’t underestimate the lifetime value of referrals for your marketing. How many times have you gone to a fancy restaurant and dropped $100. How many times did you go back? Think about how many people you’ve told, “You must try that place, it’s fantastic.”
As you are setting up your marketing plan for 2012, keep referrals top of mind. Referral marketing is not bonus business, but it can be an integral part of your marketing programs.
How has Vivid Image helped you with your marketing this year? We would love it if you mention our marketing and social media skills to others who are looking to move their marketing in a digital direction. Send us an email, like us on Facebook and tell us how we are impacting your business value.