Should you have a referral program in place? This is a question you may have asked yourself casually, perhaps multiple times — a referral program is the kind of lead generation tactic that marketers may see as a nice, additional feature that won’t necessarily make a huge impact on their business, and thus isn’t seen as being high-priority.

Of course, that perception couldn’t be more wrong. Studies have shown that referral programs are worth a lot more than people think:

• The American Marketing Association found that prospects referred to your program by a peer are 250% more likely to buy than a non-referred prospect.
• Trusov, Bucklin, and Pauwels performed a study that showed that a peer-to-peer referral costs less to generate.
• Referrals grow exponentially (one person tells a few people, each of those people tell a few people, etc.)

There’s no question about it — referrals have the ability to supercharge your marketing program and bring in a substantial number of leads. So what’s the next step towards starting a referral program?

Referral dos and don’ts
Launching a referral program will take research and planning, but these basic tips should help guide you in the right direction.

Do …

• Be honest and transparent about the referral program’s rules, rewards, and limitations
• Look into a variety of reward options (monetary rewards can bring in quick referrals, but non-monetary rewards tend to create stronger connections)
• Keep referrers updated on their referrals’ progress
• Understand your audience to ensure that you know how to motivate them

Don’t …

• Ask for a referral too soon (this violates trust)
• Build up unreasonable expectations for your program’s success
• Treat referrals as cold leads by jumping straight into a sales pitch
• Only allow customers to send referrals

You’ve worked hard to gain the customers or clients that you have — and you deserve to keep reaping the benefits of that hard work. There is lead generation potential hidden in your existing customer relationships. Don’t miss out on it!

Need help supercharging your marketing program? The experts at Proven Systems can help. Contact us by email or at (970) 223-6565.