How to use client referrals to grow your business

Every business has the same challenge: Growth.

Profits, sales, client base. These are all areas that can plateau and create serious frustration for any business owner or manager. You advertise, you market, but nothing seems to change.

65% of new business comes from referrals.

— New York Times

You have the same client who is purchasing the same products or services over and over again. To ignite that growth in your company, these repeat clients are where you need to concentrate - you need every client referral.

These individuals know people. They talk to people. They participate in social media.

By using your relationship with them, you can start bringing in new clients by the busload to grow through every client referral. There are different reasons why customer referrals matter.

And this is not just conjecture. There is plenty of research to show just how valuable getting a client referral really is.

Nielsen research shows that individuals are four times more likely to purchase a product or service when a friend refers them and nearly half of clients are significantly impacted by friends’ posts on social media. The Boston Consulting Group found that clients are between two and 10 times more likely to rely on word-of-mouth referrals than paid advertising.

So Jim Rohn’s comment that, “One client, well taken care of, could be more valuable than $10,000 worth of advertising,” is much more than just a surprising statement. It is a surprisingly accurate statement. From what I’ve seen in customer conversations, the best referral programs are built on genuine value, not just incentives. One mid-sized marketing agency we tracked saw team collaboration improve from 5/10 to 8/10 simply by making their service delivery consistent - that consistency turned one-time engagements into ongoing relationships with active referral behavior.

The following are some key ways for you to grow referral revenue:

Go above and beyond to get client referrals

Client service and experience are everything, and they are growing more and more important every year. There is just too much competition out there for businesses to be able to rely solely on the quality of their product or service.

Yes, occasionally individuals will share with their friends about a great product that they just tried out. But, more often they will share an amazing experience they had with a company—something that was extraordinarily special and made them feel that the business actually cares about them.

There are examples of this type of personalized client care in nearly every industry, from Lego to The Gaylord Opryland Hotel. And it is not uncommon for the short blurbs to go viral—you cannot pay for better advertisement.

Make people feel special and not only will they become a lifelong client, they will probably actively help you bring in countless other clients and help you grow through every client referral.

The foundation of strong referrals is a consistent, well-structured client experience from day one. When you systematize how you onboard and serve clients, you create the kind of memorable experiences that people naturally want to share.

Push your content marketing further

Another aspect of creating a positive client experience is making clients feel like they are getting their money’s worth. To accomplish this a lot of companies have begun investing in content marketing. They create e-books, blogs, vlogs, webinars, and more.

Potential clients can download, read and watch these for free. Generally, though, this content only reaches current clients or prospects who were searching the web for information about a certain given topic.

What about all of the potential clients who need your product or service but just don’t know it yet?

A great way to reach these people is through referrals. This is why it is essential to always place a forwarding link on these pages and emails. Allow individuals to easily share your valuable information and tools with others to grow through every client referral.

Be a feedback machine

Clients want to know that they matter. An excellent way to prove this to them is through engaging with them and then reacting. In other words, ask your clients for feedback.

When you have gathered the feedback, comb through it, see what you can do to address concerns, and then do it. After a few months, follow up with the client to see if they feel the issue has been solved.

This can be done in-store with a comment box, through an app by requesting client reviews, or through emails embedded with surveys. At Tallyfy, we’ve seen that businesses who systematically track and act on feedback generate significantly more referrals than those who collect it sporadically. Just make sure you’re not asking questions for the sake of asking questions. Research the most effective ways to develop a survey so you don’t waste your time or your clients’ time - if you do, this can backfire and serve as an annoyance to clients.

Just asking though strengthens your chance of a client referral.

Offer incentives to gain a client referral

To really get client referral to your products or services, provide them with incentives. You can try out different offers and see which is most effective. It might include anything from a discount on a current or future purchase to a free gift.

Clients often think that they will refer you to someone they know, and they file your information in the back of their mind—when the subject comes up, when they meet the right person, or when the time is right they will make the referral. Unfortunately, your information file gets lost in their mind because of life and all the stresses and distractions that come along with it.

You can ensure that this does not happen if you tie your incentive to a time restriction. In other words, if a client who they have referred buys from you in the next month, they will get a voucher.

Incentives, especially when combined with deadlines, get people active. Urgency works.

Be clear that you would like to grow through a client referral

Some businesses are shy about asking for referrals because they don’t want to be pushy or annoy clients. But the truth is, referral requests don’t have to annoy clients. There are non-invasive methods that can be used.

As mentioned above, all it takes is a simple link or button in emails and on web pages or social media platforms. If you also include the incentive option, clients will see it as a valuable offer rather than a burden or request.

But the most important thing to ensure is that you are clear about what you are asking for. Don’t just encourage a client referral from their friends and family to you. Provide them with information to send to individuals, offer a form that they can fill out on your website, or email them a code to email on to others that identifies that client as the referrer.

Whatever the process, make it simple and straightforward - and you will grow through every client referral - easily and quickly!

Example Procedure

Asking For Referrals

1Pick the Right People

2Time Your Ask Right

3Ask in the Right Way

4Set Up Your Referral Nurture System

5Offer an Incentive

+2 more steps

View template

Example Procedure

Affiliate Program

1Define your Pay Per Action (PPA) model

2Set up affiliate tracking system

3Create affiliate marketing materials

4Review and approve affiliate applications

5Monitor affiliate performance and fraud

+2 more steps

View template

Show gratitude when you do get a client referral

It’s great if a client refers your business to one person, but it’s even better if they refer you over and over to everyone they know and meet. If you acknowledge the fact that they are an excellent client and that their efforts are appreciated, they will keep at it.

An automated email is the absolute least you should do. Ideally, you should provide them with a discount code, offer them a free consultation, or provide them with valuable material.

To really push the point home and show them how thankful you are to have them as a client, call them, send them a handwritten note, or, if they have provided a certain amount of referrals, mail them a gift. Yes, this all takes time and costs money, but it’s worth it.

These small gestures prove to a client that what they have done has made a big difference. Based on feedback from professional services teams - which represent about 10% of our discussions - this personal touch is often the difference between a one-time referral and an ongoing stream of new business. A book marketing team we followed cut their monthly campaign work from 2 days to a few hours using repeatable templates, and the time they saved went directly into personal relationship building that generated referrals.

To drive all of these processes, it’s important to have order and discipline. If one client can truly be worth $10,000 of paid advertising, you don’t want a single one to fall through the cracks.

To ensure that you address client concerns, connect with a client in a valuable way and use all of the appropriate methods for encouraging referrals, it can be a smart decision to implement checklists. Tallyfy is one company that offers a SaaS app for workflow. This app allows users to build checklists for a variety of needs, whether it be building referral campaigns or developing quality surveys.

It has never been easier to develop a game plan, track your progress and make improvements to the process to grow your client referrals.