When a customer tells someone else about your product, the inbound lead you'll get is one of the easiest to qualify, fastest to close, and cheapest to acquire.
- They probably share similar needs and challenges with the person who referred them.
- They're already in 'buy' mode.
- They trust your product because someone they know and trust uses and recommends it.
As many as 84% of B2B purchases start with a referral. And referral leads have a ~30% higher conversion rate compared to leads from other sources.
Most businesses get referrals from time to time. But, if you're just waiting for them to happen organically, you're leaving a valuable source of leads untapped.
Building a referral program shouldn’t be complicated.
Mastering your referral program is a lot easier than it looks. It's all about creating a system and process that encourages and rewards your satisfied customers for sharing their positive experiences with others, without making it a chore to participate.
1. Make it accessible to all your customers.
Finding the right customers for advocacy is usually the #1 pain point when running an advocacy program. Most fall short because they're too focused on targeting top influencers, rather than a broader segment of their customer base.
Referring a new lead to your company should be as easy for them as sending a social media post. Use a customer advocacy platform to...
- Have customers onboard themselves through a guided process
- Submit referrals directly through the system
- Automatically track who they refer, where those referrals are in your sales funnel, and the impact of their contributions
2. Put your incentive at the forefront.
Show the value they will receive if their referrals convert. Instead of sending them a generic thank-you message, communicate the specific reward they'll get.
Incentives that work best:
- Cash rewards
- Discounts on future purchases
- Exclusive access to new products or features
The point is, your rewards system should be clear and simple. Designate a specific reward for each referral category so every customer knows that when they do X, they get $Y.
3. Always keep the referee in the loop.
When a customer refers someone to your business, make sure to keep them updated on the progress of their referral. This (a) shows appreciation for their effort and (b) keeps them engaged and motivated to continue referring others.
During the sales process, send them updates on the status of their referral (e.g. lead contacted, demo scheduled). Once the deal closes, personally email or message them, thanking them for their referral.
Making referrals a top source of high-quality leads
The most powerful form of marketing is word-of-mouth. The reason is simple: it's authentic.
When you build your referral program, your goal is to maintain that authenticity while intentionally amplifying the volume and impact of your satisfied customers' voices.
A few best practices to keep in mind:
- Allow referees to personalize their pitch. Give them the opportunity to share their own experiences with your product, rather than providing a generic message for them to copy and paste.
- Look for opportunities to solicit a positive response. Even if a customer doesn't immediately elect to refer someone, invite them to when they leave a positive review or respond enthusiastically to a customer satisfaction survey.
- Make it easy for customer advocates to stay informed. Your software's customer-facing interface should enable them to track their rewards, referral activity, and its value.
- Engage referrers through other channels. Newsletters, loyalty programs, product testing, VIP early access to new features, and customer reference calls are some ways to maintain and strengthen your relationship with them and extend their value.
Referrals are just one avenue for advocacy.
Building a strong referral program is critical, but not all your customers will be willing or able to refer others. And some are willing to do a lot more.
A well-rounded customer advocacy program is flexible, so each customer can contribute their feedback and actions in ways that suit their time, motivation, and comfort level.
It has to incorporate:
- Testimonials
- Reviews
- Case studies
- Customer reference calls
- Product feedback and suggestions
- User-generated content
With Deeto, you can build your whole customer advocacy program on one platform and manage all your customer advocacy initiatives from a single dashboard.
Request a demo to see it in action.
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