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How to Build a Customer Referral Programme

It has become something of a cliché – a dissatisfied customer will tell more people about their experience with your business than a satisfied customer. But like many clichés, it has its basis in truth, with several studies finding this to be the case.

But while most businesses dedicate resources to placating dissatisfied customers, many overlook those in the satisfied camp. And that could be a costly mistake.

A recent Nielsen survey found that 80%+ of consumers, from Gen Z through to Boomers, trust referral marketing – with almost a third of Millennials saying they will not try a product if their friends don’t approve it.

Most notably, Nielsen’s survey found that B2B companies with referral programmes see up to 70% higher conversion rates.

And the best part is, putting a customer referral programme in place does not have to be a complex business. Here, we’ll look at how to start generating quality referrals in just five simple steps.

What is a referral programme?

In short, a customer referral programme is any method that standardises word of mouth sharing of your services. This could be a simple forwarding link on company emails, an incentivised programme, or a formal scheme with customers acting as ambassadors.

It is ultimately a growth tactic, aimed at winning new customers on the recommendation of your existing customers. And it works. A staggering 92% of consumers say they trust referrals and recommendations from friends and family.

Create a Customer Referral Programme in 5 simple steps

While customer referral programmes may not be too difficult to set up, they require thorough planning for maximum results. When designing yours, you should focus your efforts in these five key areas. 

1. Define your goals

Before launching any campaign, you need to outline precisely what you aim to achieve. Are you looking to drive sales across the board? Do you want to raise the profile of a particular product or service? Or do you want to increase customer loyalty at the same time as uncovering new leads? Once you’re sure what you’re aiming for, you can start drawing up a plan to reach your goals.

2. Choose the right channels

A great referral programme should be simple. Referral links and messages must be easy for your customers to share and easy for you to track. You should consider whether you wish to use referral links, a customer portal, pre-written messaging, or any other methods. The one that’s right for you will depend on the nature of your business and customer base.

3. Incentivise!

Some customers will recommend your business solely because they love your offering. Others, however, will need a little extra encouragement. Consider what is most likely to incentivise your customers to spread the word. This could be a cash payment, a discount code, gift, or anything else you feel your customers could benefit from. And remember to offer a welcome incentive to your new customers too.

4. Spread the word

Your referral programme can only be a success if your customers are aware of it. There are several ways you could spread the world. Consider placing referral messaging on invoices and in email signatures, as well as prominently in customer portals. You should also contact your customers directly, introducing the scheme, and explaining how they can earn rewards by recommending your business.

5. Be sure to follow up

Your referral programme is only as good as your follow-up. It’s crucial that you make contact with leads as quickly as possible, and that you follow clearly defined next steps. As well as acting quickly to sign up any potential new customers, you should also follow up with your referrers. If they are swiftly rewarded for their efforts, they are even more likely to recommend your business in the future.

Customer Referral Programme Ideas

The more eye-catching your referral programme, the more likely your customers are to engage. From straightforward discounts to contests and giveaways, there are plenty of effective ways to entice your customers to get involved.

Discounts and credits

The most direct way to reward your customers is to offer them a credit to spend with your business, either to their account or in the form of a voucher. Discounts are effective too. These can be tiered, with 5% off for one referral, 10% off for five referrals, and so on.

Prize draws

Offering a big-ticket item can be a great way to generate engagement in your customer referral programme. This could be one of your products or a popular prize such as a TV or tablet. If you opt for this approach, you may want to offer entry to the competition dependent on a successful new sign up. This will help to discourage low-quality referrals.

Ambassador programmes

If you want customers to make multiple high-quality referrals, consider starting an ambassador programme. Here customers are rewarded depending on how many of their referrals sign up to your services. The more successful sign-ups they generate, the more exclusive benefits they receive.

Take your business further with Business Incorporation Zone

There are few better ways to generate new business than through your existing customers. When implemented correctly, a customer referral programme becomes a powerful lead generation tool – designed to help your business grow.

We know all about growth at Business Incorporation Zone (BIZ), with years of experience helping businesses flourish from startup and beyond.

We are a team of company registration professionals who are passionate about bringing the dreams of aspiring entrepreneurs and SMEs to life.

As well as handling trade license applications, BIZ can also assist with the opening of corporate bank accounts and advise on the most appropriate financial institution to suit your specific needs.

We also offer visa and immigration services and can handle all government formalities, permissions, work permits, and visa applications required to trade in the UAE.

In short, our experts can establish your company on your behalf, make your license and visa applications, and take care of all the necessary admin – leaving you free to get on with running your business.

Spoil your start-up with the best value-for-money offer, for just AED 18,900 get a trade license with 6 visa allocations & 1 free visa for 3 years.

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Start up with the flexible packages starting from AED 13,500 and scale your SME up to 15 visas without renting any physical office space. Get in touch with us to create your future.

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