Do You Have A Referral Strategy?Mar 16, 2022
Do you have a Referral Strategy?
Do you have a Referral Strategy, or are you relying on word of mouth?
Encouraging your existing customer database to sell your product's and services for you will be one of the best investments of your time & money. Investing TIME and MONEY into encouraging your existing happy customers to work for your business will take some planning, some action and a small amount of cash. But, a lead-generating website's aside, a good referral strategy will probably give better ROI than most other marketing strategies.
But what is the ROI for a lead generating website, an advert in a local area magazine or your simple and low-cost Referral strategy? Many plumbing businesses fall short by not seeing the importance of collecting data. Followed by taking the time to calculate basic data such as Win Rate's, Cost per lead & Cost per Acquisition. Knowing these basic numbers will allow you to focus on the marketing strategies working for you and cut out the expenditure costing money. Remember, Time is Money and therefore, Money is Time and every £100 wasted has cost you time to collect it!
Marketing costs / number of leads = Cost per lead
Marketing costs / Jobs won = Cost per Acquisition
The following year after introducing our Referral strategy, we found that
17% of new customers had been referred to us by past customers, up 10% from the previous year! The data also showed that the win ratio was much better for a referred customer than a brand new customer who has found our details elsewhere.
Building your referral strategy
Below I'm going to outline the five steps to getting more customer referrals, giving you more profit, and in less time.
Step 1: Approach every job in the future with a priority of collecting another five-star review. Wowing your customers with an unexpected level of customer service will make it much easier for them to tell others about the service they experienced with your company.
Step 2: Plan, write and perhaps create a video for your Referal Incentive. Year's ago, we offered a Complimentary Free Boiler Service for successful referrals. What can you offer that would be of interest to all customers? Maybe £50 / £100 of Love to Shop vouchers would be easier to market to all customers?
Step 3: Ask for a referral ( How will you do this? )
I understand that blatant asking somebody face to face might seem a tad pushy! So maybe being a little more subtle in the approach would be better. Include the Referral offer with the documents you hand over after work is complete. Via printed flyers or as part of email communication, always pointing to the benefit, free service, voucher or cash incentive. Your mindset should be that you are not bribing them for something. You are thanking them for making an effort to pass your details to their friends, family and work colleagues.
Step 4: Keep in touch via Email & SMS, and Social Media.
As some customers will find you and use your services at short notice, they may not necessarily know how much of an expert in your field you are. Try to keep in touch with your customer's after the deal/service is complete. From time to time, give advice and helpful content, positioning you and your team as experts that your customers can trust, and when possible, refer to friends & family. The odd offer for new products is ok, but try to send help & support rather than sales messages.
Step 5: Be helpful when needed. Repeat your 5-Star service at every contact. Hopefully, you are getting the idea. You have to aim at excellent and friendly customer every time they make contact with you. If you can't help them? Find somebody who can. Create a network of people who also serve your customer base with different products & services. By linking with other engineers and other trades, you could be the knight in shining armour to save the day.
So what is your referral strategy?
How do you encourage your customers to recommend you to their friends, family and work colleagues?