Insight #20 - Referral Marketing Power

Word of mouth and referral marketing is the oldest, most powerful, and most profitable way to grow your business. The best part is that by virtue of the way they discovered you, referred customers also tend to be some of the easiest to deal with, and the easiest to maintain and grow. They also tend to be the most likely to continue to refer new customers to your business.

There are dozens of ways to grow your referral business, and they’re often as simple as asking your current clients to spread the good word. However, clever timing, incentives and technology can make a huge difference in the success of your referral initiatives.

Joe Girard became the most successful sales person in the world (Guinness Book of World Records), by capitalizing 100% on simple referral systems that included a thank you card (snail mail) and a small reward for referring new clients. However, today’s Internet, email, interactive and database technologies take the potential for referrals to a whole new level that can literally double the size of a business in no time at all.

In fact, if each new customer was to promote your business to just two other new customers, through a well designed referral system, your business would actually grow exponentially as the referring cycle perpetuated itself.

Tip #20: Be certain that you’re thanking your satisfied customers regularly, and make a point of asking them to refer your business to their friends on a regular basis. Use creative ideas, rewards and incentives, and employ technology to make it as easy and rewarding as possible for them to continue to help you grow your business.

Over and above your ongoing initiatives, use special, themed, targeted and promotionally-based referral campaigns from time to time to even further boost to referral results. Tying referral marketing to customer satisfaction surveys and telephone follow-up can be extremely effective, particularly right after the customer has been delighted with their last interaction with your company.