Referral Incentives

FACT: Providing quality products or services is not enough reason for people to refer your business to others. In fact, people are far more likely to talk about your business when they are unhappy with your product or service than when they are happy with it!

Therefore you need to develop an incentive plan that will give people a reason to refer your business to others.

In establishing referral incentives there are some important elements to consider:

Be consistent and reward referral sources equally.
Determine the potential cost of the program in advance and plan appropriately.
Decide if you will be rewarding:
1. All referrals
2. Referrals that purchase only
3. Referrals that purchase above a certain amount
You could consider doing a tiered incentive program as well.
Select what the incentive will be:
1. A gift?
2. A gift certificate?
3. A percentage or dollar amount off their next purchase?
4. Or plain ol’ cash?

Adding special touches such as unique wrapping or a hand made card make an even greater impression. I have even seen custom gift certificates made of chocolate wrapped in gold given to appreciative clients! They not only get to spend their reward they get to eat it as well! You can continually reinforce your relationships by sending a personal note or inspirational message to your referral sources as well.

There are also other less tangible ways to recognize the people who refer business to you; like recognizing them publicly by thanking them in your newsletter. Or, establishing a section of your newsletter that thanks them and shares what they received as a result of referring. This can be very effective.

Be sure to track and follow up on your referrals. Share with the source that referred you what is happening with that referral. Tell them what you plan to do next and keep them informed. They will appreciate knowing how well you are taking care of the person they sent to you.

The most successful incentive plans to get people to refer you are generally special and memorable, leaving an impression upon the source so that they will be inspired to continue referring your business to the people in their lives. Using an effective incentive plan will help you do better and smarter business.

Kelli C. Holmes is the Founder of TEAM Referral Network, a professional referral organization that turns success-oriented business people into a strong team of networking professionals who work together to build their businesses by referral. Relationship marketing is a better, smarter way of doing business. For more information visit their website http://www.teamreferralnetwork.com/ or call (866)311-TEAM.