How to find budget for your marketing (referral marketing) initiative

Allegory of a marketing budget

If you have never read Plato’s Allegory of a Cave or even if you have, you may have not connected it to business today.  But when you’re trying to get budget for new marketing (referral marketing) initiatives the Allegory of a Cave resonates with the predicament that many marketers are facing.

In Plato’s Allegory of a Cave, men have been chained facing a wall their whole life. The fire behind them casts shadows onto the wall in front of them.

Out of all the men, one is freed. Slowly, he makes his way out of the cave into the light of day. At first he is blinded by the light, but when his eyes adjust he is able to make out the world around him. The man descends back into the cave to tell the other men of the real world and the marvels it offers, but he is blind in the dark now that his eyes have adjusted to the light. The men chained to the wall however see the man’s blindness as evidence of the danger the world above poses and don’t believe the man.  The shadows are the only reality they have every known and they can’t conceive that anything better exists outside the cave.

Marketers who have seen the light of day often experience a very similar struggle to the one that Plato described in the Allegory of a Cave when trying to get budget for new marketing initiatives like referral marketing. But it’s not because the decisions-makers are ineffective or deaf to what they’re saying, but that they haven’t been educated in the same manner.

It can be very difficult to get someone to step away from what they know and into what they consider the unknown. Many times, experienced Marketers are so busy focusing on the shadows of leads from noisy marketing channels (PPC, social media, and email) and trying to make them real that they can’t focus on a new path to greater lead generation.  It’s up to you to show them the way.

But how do you convince decision-makers to give you budget for referral marketing?

  1. The me-too strategy – You might remember the well-loved children’s book, Me Too, by Mercer Mayer. One of the very first pages reads, “When my little sister saw me riding my skateboard she said . . . ‘Me too!’” Most likely you’ve got a competitor who has already discovered the advantages of referral marketing, or at least are talking about it. If you present a decision-maker with this they’ll be more inclined to look into referral marketing and find budget for it.
  2. Get help from your peers – Having a peer send an article or study about referral marketing to your boss/CEO helps to educate them and enforces the idea that referral marketing has support. Even if your boss isn’t the decision-maker it helps when a proposal comes from further up the ladder.
  3. Use Sales – When you’re trying to sell your CEO on something, why not bring in someone whose job it is to sell. By making the referral marketing proposal with Sales you’ll deliver your CEO the unexpected and it will be hard to say no to the first thing you’ve ever worked together on. And if you really want to make it hard for them to say no, throw a curve ball by bringing in Customer Success for the pitch also.
  4. Reallocate funds– Sometime no matter how hard you sell an initiative there just isn’t budget for it. However, that doesn’t mean this is the end. It may not be about getting or asking for budget, but creating room in your current budget for your new marketing initiative by reallocate funds from initiatives that aren’t producing quality leads anymore.  Referral marketing has a 4x better conversion rate than traditional marketing leads (emarketer). Look at your conversion rates and decide what money you can reallocate to a referral marketing initiative.

Do you want to hear from other business professionals about how you can get budget for your marketing initiative? Try listening to the webinar, Getting Budget for New Projects: Advice from CMO’s.

And to make a case for adopting referral marketing try the ROI calculator to determine what your ROI would be with a referral program.

ROI Calculator

How referral software bridges the chasm of B2B technology adoption

Escape the Neverland of the technology adoption life cycle with referral software

There are many stories and movies that document and romanticize the idea of never growing up (Peter Pan and Pippi Longstocking). And it’s not hard to see why. Childhood and adolescences is a time full of opportunity, innovation, and creativity without the responsibility or social expectation of having everything figured out. This is very similar to the technology adoption life cycle during the innovators and early adopters stages, from Geoffrey A. Moore’s book, Crossing the Chasm. The type of creative and experimental license and development that takes place during these stages of the technology adoption life cycle is only accepted at this time because of the psychological characteristics that categorize innovators and early adopters.

  • Innovators – Innovators are forgiving. They know your technology will have its challenges and maybe some issues but they embrace it because they want to be cutting edge.
  • Early adopters – Early adopters can see the potential of your technology before it has presented proven or widespread results. However, their belief in your product includes the expectation that everything is working properly.

Both innovators and early adopters are characterized by their lack of focus on a technology’s proven results as opposed to its ability to have great future results and put them ahead of the curve.

But while those adopters are necessary to amass in the early evolution of your technology’s development, no business wants their growth to halt at the early adopters stage of technology adoption. After all, even Wendy from J.M. Barrie’s classic, Peter Pan, is ready to grow up and leave Neverland eventually. Just as every startup will inevitably attempt to get their technology adoption to grow and cross the chasm to reach the early majority. Unfortunately, unlike Peter Pan, fairy dust and happy thoughts will not fly you over the chasm like it flew the Darlings home (although it would be great if it did).

When trying to cross the chasm to grow your customer acquisition you have to understand the psychological characteristics that are inherent in the early majority to know the cause of the chasm between the early adopters and the early majority. These characteristics include:

  • Pragmatism
  • A desire for proven results
  • The craving for referrals and reviews from trusted sources
  • Evidence of program support

By understanding the characteristics that cause the chasm you can then start to figure out how to construct a bridge between your early adopter and the early majority.  Otherwise, like many other startups or new technologies, you might get stuck in the Neverland of technology adoption with little chance for growth.

So what will help you construct that bridge?

The early majority aren’t looking for your assurances on how reliable and cutting edge you are, they need to hear that from sources outside your business that have experienced the benefits and challenges of your technology. This means that your business isn’t the one who can physically layout the bricks to build the bridge, your customers and partners are.

But as you know, to be disruptive you need to have control, automation, and the ability to scale in all your processes and initiatives, including advocacy. Automated referral programs provide those features.

How to give Advocates the materials and motivation to build your bridge

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While you may not be able to directly bridge the gap between early adopters and the early majority, you do have the opportunity to increase the referral reach and activity of your current customers and partners by giving them the tools that optimize the process. And lucky for you, innovators and the early adopters are inherently enthusiastic and optimistic about your technology which makes them prime candidates to refer.

Automated referral software turns that simple enthusiasm into action by providing you with the opportunity to incentivize and empower referrals through a consistently branded channel of communication that motivates your innovators and early adopters to make a warm introduction to your potential early majority adopters. Through this channel, Advocates can extend the trust and respect of their previously established relationships to encompass your brand and create a bridge of communication over the chasm to the early majority for high valued interactions.

In fact, the automated referral software bridge is so effective at crossing the chasm that studies have proven that referral leads convert 4x more than marketing leads, (emarketer).

So if you’re in the process of staring down into the chasm that separates your current customer and the next stage of your technology adoption, ask yourself this question.

Do I have the right tools to bridge the chasm?

If you don’t know the answer to that a referral program might be the exactly what you’re looking for. After all, no one wants to be stuck in technology adoption Neverland forever. Calculate how automated referral software can bridge the gap and improve your ROI now!

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Mirror, mirror on the wall . . . Are your referral metrics the fairest of them all?

Don’t let vanity referral metrics lead you astray

Marketers put a substantial amount of time into referral initiatives and programs in an effort to grow revenue and achieve fantastic ROI. But it can be difficult to determine what referral metrics actually represent how our programs and strategies are performing. The problem is there are growing amounts of metrics that all are promoted as providing amazing insight into your initiatives but without context, the metrics you’re relying on and any wonderful insight you’re seeing can easily turn into a vanity metric.

But what is a vanity metric? A vanity metric is a metric that appears to demonstrate program growth but in reality doesn’t reflect the health of your initiative. Often, this happens when metrics are being looked at as a standalone performance indicators instead of being connected to revenue producing action.

So how can you tell if you are relying on referral vanity metrics? By asking the right questions about your data and reports. This not only applies to referral programs, but marketing automation, CRMs, and much more.

How to avoid turning your referral metrics into vanity metrics

There’s no such thing as a stupid question. In fact, the more you question your referral metrics, or any metrics, the better off you’ll be.  So where do you start?

One of the main cause of your metrics becoming a vanity metric is if you’re looking at them all individually instead of creating context by looking at how each metric relates to one another.

Follow this line of questioning to avoid having your referral metrics turn into vanity metrics and determine if your referral program is really paying off as well as you thought it was.

Questioning your referral email metrics

1.Your referral program promotional emails have a good open rate, but are you getting click-throughs?

While potential Advocates (customers or partners) might be opening your emails, if nothing is motivating them to take the next step it’s time to reevaluate your emails and pinpoint what is turning advocates off or what could be changed to motivate them to click-through. However, by itself, click-throughs are not a constructive way to measure the success of a referral email.

 2. If you’re getting click-throughs are they translating into conversions?

Click-throughs are only as valuable as their next action. If click-throughs aren’t translating to conversions than they don’t mean a thing.

 3. What action do you want your potential or current Advocates to take?

One thing to consider is what you have defined as a conversion. If a conversion is something so insignificant that it won’t help get your program any closer to generating increased revenue there is no point to it. In this current state, a conversion becomes a vanity metric. However, if you define your conversion as registration into your referral program or current Advocates making a referral from a promotional email they received, then you have conversions that are worth more because they are on track to producing revenue growth.

Questioning your Advocate referral metrics

1.You have Advocates, but are they making referral shares?

Let’s suppose a substantial number of Advocates have registered for your referral program. What does that mean? While it is defiantly a good sign it doesn’t mean your referral program is demonstrating growth. If your Advocates aren’t making referral shares they aren’t generating revenue growth for your program. Look into your rewards to see how you can better spark Advocate referrals.

2. If they’re making referral shares, are they sharing it with the right people?

If Advocates aren’t sharing referrals with the right people, they aren’t going to be accepted. Communicate to your Advocates what demographic would lead to a successful referral. Tell them to keep a look out for people who would benefit from your product or service, a person or business that has the resources to buy, the right person within a company that is or has the ear of decision makers, or all of the above.

3. If the referrals are largely accepted, are they closing?

The people your Advocates are sharing referrals with might be accepting the referral but no sales or not a large amount of sales are being closed from it. While a large number of accepted referrals might look good, if they aren’t closing you’re not generating large revenue from your referral program. Try to determine what is making Advocates decide not to buy (price, miscommunication or features) in order to adjust your pitch and close more referrals.

When evaluating your referral metrics or any program metrics always ask yourself whether this action contributes to your revenue growth. If the answer is that it doesn’t then you’ve encountered a vanity metric.

However, if you have tied your referral metrics to revenue growth but they aren’t showing that you are generating the revenue to meets your goals your problems might be greater than vanity metrics. More likely the issue lies with your referral program itself.

Start exploring how to improve your ROI by learning how to implement a scalable automated referral program with the e-book, 8 Steps to Initiating the Right Launch Sequence for your Referral Program

launching a referral program

Originally published on Salesforce 

Questions? Email me at JEdmondson@amplifinity.com

Why referral programs generate more quality leads than automated personalized marketing

Technology is trending, and as Marketers, we’re always keeping an eye out for the next big breakthrough (like referral programs) that will make our job easier. So when automated personalized marketing came onto the scene many thought it was that breakthrough. After all, personalized marketing has made amazing strides in the past few years and automated personalization has become a highly adopted best practice for both B2Bs and B2Cs. This is often employed through an automated software like marketing automation, which crafts individual messages in an attempt to create a customer-centric approach. And for a while, this form of personalized marketing was the ultimate way for Marketers to create a targeted strategy. But as we know, when a channel or tactic becomes highly adopted its effectiveness begins to wane as it becomes increasingly crowded and noisy.

In fact, as of recently, “The majority of marketing leaders report dissatisfaction with results from Marketing Automation. Frost & Sullivan reveals 75% not accomplishing what they expected,” (Root Causes of Marketing Automation Failures).

This is not a surprise. After all, just in one day I receive an average of 30-50 personalized automated emails in my personal email account and 10-15 in my work email.

So what do I do? I click check all and delete. Whether it’s 50 consumer emails or 15 B2B emails, ask yourself, would you really take the time to sort through them all to determine if one offers you value.

The reality of the situation is, that even for the 15 B2Bs that are sending automated personalized emails to my business account, I’m very unlikely to open them. I have deadlines to meet and despite if I know the business, I haven’t developed any personal relationships with them so in my mind they can’t be sending me anything that will fulfill some unfulfilled need because they don’t know me well enough.

The same can be said for prospecting emails. I’m sure you’ve experienced someone who has stalked your LinkedIn or Twitter profile to piece together your work email and send you their solution to all your problems. Or it might be your job to send those emails.  And while you or one of your prospect may click on them once in a while, they mostly end up in the same place – the trash. But this doesn’t mean that the sender of those emails are doing anything wrong, it’s just the nature of prospecting today.

And although the success rate of automated personalized emails and prospecting emails has declined, I’m not saying that you should abandon these marketing efforts, just that you can’t rely on them to generate high quantities of quality leads anymore. While you’re headed down the right path with personalization and the attempt to create a customer-centric approach, these approaches are missing a vital component to succeed today – the relationship.

How referral tracking programs succeed in high quality lead generation

Referral tracking programs are that next big breakthrough for Marketers.  Referral programs employ a relationship-focused sales approach in a strategic customer-centric way. Referral tracking programs harness the power of your current customers, partners, and employees’ relationships with their network and  incentivizes them to provide you with a warm and trusted introduction. These advocates already have an established relationship with the customer demographic that you hope to capture, and because of that, they’re referral of you is more powerful than any unsolicited prospecting email or automated personalized email.

Referral tracking programs offer automation and clear ROI while employing all-inclusive sharing options that attribute advocate referrals and measures each advocates individual success to optimize your nurturing strategy and get the most return on investment.

In fact, referral programs:

  • Create a 4X higher conversion rate than typical marketing channels (emarketer)
  • Increase LTV by 16% compared to non-referred customers (Harvard Business Review)
  • Decrease churn by 18% compared to non-referred customers (Harvard Business Review)
  • Increase a leads likeliness to buy by 400% (Nielson)

But you don’t have to trust the numbers. Discover what your individual ROI and revenue would be with a referral tracking program by using the referral ROI calculator now!

ROI Calculator

Choose the advocacy adventure that’s right for you

Where to start on your advantageous advocacy adventure

In the past few years the martech industry has become flooded with promising solutions that strive to solve the challenge of breaking through the marketing noise and acquiring the leads, recognition and notice you desire.

Advocacy is the latest and greatest new marketing channel that facilitates the acquisition and retention of greater quantities of quality leads and increased brand recognition. Gartner’s research finds that “Referral marketing is a channel that offers a high volume of excellent low-cost leads.” This is done by capitalizing on the trust of advocate’s previously formed relationships which other forms of traditional demand generation tactics and brand awareness methods cannot hope to access.

But the term “advocacy” has become quite fashionable in the marketing world, and has generated a great number and variety of reference and definitions.

So how are you supposed to know which subcategory of advocacy your business should venture down first? Well, there are a number of factors that help determine what advocacy adventure is the most advantageous for your business.

Think of choosing the right form of advocacy akin to a-choose-your-own-adventure book. You want to choose the path that will get you the biggest impact. And while choosing the wrong advocacy path might not cause you to be killed by aliens or fall down a well and break your leg, it can keep you from achieving your goals.

For instances, imagine if your advocacy adventure said:

You walk into a maze. Two paths are open to you but neither indicate which path is more advantageous. Do you go right or left?

You choose right. After walking for a bit your path splits into four more unidentified paths. Which path do you choose?

You choose the path on the far left. After walking for a little while longer you hit a dead end. Unfortunately, you’ve now wasted time and have put off achieving your goals.

The fact is, if you don’t know where to start your advocacy adventure it will never be advantageous.

Amplifinity’s advocacy quiz ensures that your advocacy adventure will remain advantageous by helping you to figure out the right starting point for your business objectives. Take this quick quiz today and start on your way to your advantageous advocacy adventure.

ROI Calculator

Want to further the discussion? Email me at Jedmondson@amplifinity.com

SMB Telecoms become tele-competitive with referral software

A revolution is taking place. One that might have very similar roots as the all-so-famous Revolutionary War. But what does this mean?  Well, in many areas of the country and the world, large telecommunication conglomerates have the monopoly on their telecom industry. Customers have only a few choices in their television, Internet, email, or phone service provider. In any way that matters, these telecommunication companies are essentially king.

So how are small and medium sized telecom businesses and newer technology driven technology driven telecoms supposed to convince customers to riot and switch over to them? Well, as you yourself may have experienced or heard from others, smaller customers don’t always feel well-cared for by the kings, and while they might provide great prices at first (this usually changes later),  many people have become frustrated and disenchanted with their unapologetic treatment of customers.

This alienation of customers leaves an opening for SMB telecoms. While SMB Telecoms  might not be able to match the pricing of the telecom kings, you can provide something that people and business are ready to revolt for, a personalized customer experience.

How RingCentral personalized their customer experience

RingCentral delivers cloud business communication solutions with a relationship focused sales approach. The success of their business depends on keeping every interaction extremely personalized. In their blog, RingCentral’s Sales Organization: Building Success by Building Relationships, they emphasize how building a relationship with customers is a necessary part of their business model.

To keep to this relationship focused approach, from the first phone call RingCentral starts their interaction on a positive note, which they believe can make all the difference in fostering a fruitful relationship. If your sales team demonstrates how they care for their potential customers and understand their pain points you can start to establish a relationship that builds to a sale.

For RingCentral this often pays off when pursuing a company that has more than one location. RingCentral noted that the previous fostered relationship then opens the doors for a client to test out their product in one location, and when it succeeds, the company often revolts against the previous telecom technology and fully implements RingCentral’s technology instead.

RingCentral claims that this success is “a direct result of our relationship-building efforts.”

And because RingCentral had proof of the power of a relationship focused sales approach they understood what the next step was to their approach – referrals. With small and medium sized telecom business increasingly focused on customer relationships, why not grow your business through mass personalization by incentivizing the customers who already know how valuable your product is? RingCentral thought along the same lines, and that’s why they implemented Amplifinity’s referral software to make their customers their best sales force.

The next step to relationship building sales – referrals

Referral software is the next weapon to spur the masses in the customer relationship revolution. Referral software mobilizes the customers you already have by incentivizing them to become advocates for your service or product. By empowering referrals with referral software you extend the trust between an advocate and their network of family and friends to include your business. The result of this is a drastic increase in your quantity of quality leads.

In fact, with referral software:

  • Customers are 400% more likely to buy (Nielsen)
  • Leads convert 4X better than marketing leads (emarketer)
  • LTV increases by 16% (Harvard Business Review)
  • Conversion rate from referral to purchase is 36% (Amplifinity)
  • Churn decreases by 18% (Marketing Business Review)

Discover your personal referral program ROI with the ROI calculator now!

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Questions? Email me at JEdmondson@amplifinity.com