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By now, you've probably realized that your customers trust their peers more than they trust your brand. And those peers are constantly sharing what they like and don't like with their networks.
Related: 25 Ways to Ask for a Referral Without Looking Desperate
Just look at social media. Your friends are constantly talking about businesses just like yours. They may even be offering glowing recommendations — recommendations that you and other friends of theirs will pay attention to. According to Mark Zuckerberg, "Nothing influences people more than a recommendation from a friend."
Word-of-mouth marketing is a powerful form of marketing, but extremely difficult to control. We can't all be like Uber, Dropbox or Airbnb, businesses that were built on word of mouth. But it is possible to grow your business through customer referrals. Here are five steps you can take to create a referral program that works for your business.
1. Offer an incentive.
You can't expect referrals to just happen. And asking isn't always enough to get customers to recommend you. They need to know what's in it for them.
That's where an incentive comes in. In exchange for recommending your business and referring a friend, offer a discount, upgrade, free item or other gift. Whatever you decide to give, make sure it makes sense for your business.
It doesn't need to be a huge cost, either. Dropbox gives its customers an extra 500 megabytes of space in return for inviting a friend. That way, Dropbox gets the referral, and no reduction to its bottom line.
2. Get the right information.
Referred customers are more valuable than leads since they are already invested in your business. These kinds of customers help you build the right audience. But, how you get the referral matters just as much as getting it.
Acquiring a name and email address isn't enough. You must go beyond just gathering leads and actually get them to convert.
"The best referrals are where a customer actually facilitates a meeting, visit or purchase by the referred person, in person, by email or otherwise," says Daniel Kehrer, editor and director of content development for Business.com.
3. Time it right.
Timing is key for any form of marketing, but especially in regard to referrals. Ask for a referral at the wrong time, and you risk being ignored and even losing business.
The best time to ask for a referral is when your customer is engaged and highly satisfied with your business. Then, you can take that person's positivity and channel it into the action you want him or her to take.
The perfect time could be right after the customer has made a purchase or had a positive customer service experience. There may be several moments when it makes sense to ask for a referral. Just be attuned to your customers and how they will respond.
4. Make it easy.
Giving a referral shouldn't be a difficult or confusing process. So, you want to make sure your referral program is set up in the easiest way possible. Your customers shouldn't have to work hard or put in a lot of effort to refer someone. Don't assume that customers already know about your referral program, either. If that's the case, you won't get many takers.
The idea is to create a seamless brand experience that encourages your customers to participate. By making your referral program a prominent part of your website, and promoting it through multiple channels, you'll make your customers' journey easier.
5. Get the word out.
As mentioned, getting people to participate in your referral program means you have to make sure they know how to do it. That's why you need to make it visible.
Start by dedicating a page on your website to referrals. Include the details of your program, and a clear and simple call to action. Consider adding a form to the page to capture your customer's referral information. Having a dedicated page also makes it easy to share the link through email, social media and other channels.
Related: 2 Secrets to Maximum Referrals
If you want to get even more visibility, make your referral program visible on your home page. For example, Prize Candle placed a call to action for its referral program in the upper left of its home page. This makes it easy for customers to see it, and ensures that everyone who visits the website will know about the program.