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

The lead generation matrix

Okay lead generation marketers, red pill or blue pill?

Anyone in marketing understands the continuous state of change we’ve endured since mobile and social technology entered the picture. Lots of amazing innovation that turned marketing practices on their head. I don’t know about you, but to me it feels like we’ve kind of got a handle on things for the first time in many years. We tackled SEM and SEO. We’ve got an advanced lead nurture program. Our websites are optimized for lead generation. Many of us have even found ways to adopt a level of personalization into our digital experiences. So what’s next?

Whether you realize it or not, marketers are living in a “matrix” of their own creation. A matrix that has kept upper management happy for a while. But take a good look around. Is everything as you think it is? If you take a close look at your data, you may start to notice some interesting things.

  • Your lead nurture email open and click through rates are likely eroding
  • Teleprospecting success rates are slowly declining
  • Paid search costs are rising
  • Advertising and even syndication are losing their luster
  • Activities like tradeshows and webinars that used to be for lead generation are now predominantly for awareness

But why is lead gen declining? It was going so well…

The answer depends on which pill you take.

If you take the blue pill, you can live in bliss for a few more years. Your results will still be decent, but you won’t be able to achieve demonstrable growth. That’s okay, you’ll still keep your job, mindlessly doing what you’ve been doing for the past 5 years.

If you take the red pill, you’re going to have some hard work ahead of you. You’re going to need to rethink your lead generation methods and how you engage customers. For those of you ready to take the leap, here’s what lies ahead.

  1. First, you need to stop putting so much effort into traditional outbound marketing. That’s what is collapsing. Take a hard look at the resources (both people and spend) that you are putting into activities where you are paying for leads. Take note of what’s still working and what is losing its luster so that you can reallocate those resources.
  2. Next, invest in customer advocacy and referral marketing. While your target buyers have started ignoring your message, they have some key people in their network that they trust. Referral marketing allows you to leverage those trusted advisors like customers and partners and have them approach your target buyers on your behalf. This drastically scales your lead generation efforts at a low cost.
  3. Then, you need to put focus on customer delight. Per the point above, your customers can expand your reach, but you need to make sure they are thrilled with your product and service.

Taking the red pill means you are going to have to shepherd a new lead generation strategy and culture through marketing, sales and customer success. It won’t be easy. But it is the only clear path to marketing success.

What will you decided? Will you take the blue pill and continue to add to the marketing noise? Or will you take the red pill and wake up to a whole new way of marketing?

 

launching a referral program

This vacation brought to you by business referrals

Referrals take the guesswork out of your buying decisions

I’m sitting on a South Pacific beach, and you’d think that the farthest thing from my mind would be business referrals.  It was one of the first days of vacation and maybe I hadn’t quite pulled the plug, so I started thinking about referrals from a different perspective.  We usually think in terms of what referral advocates do to get the attention of prospects, but maybe we need to think more about the value of referrals to the prospects.

I did a thought experiment where I put myself in the role of a purchasing agent in a large organization.  And since I was settling into my vacation at a time-share resort, what better type of organization to consider. I need do no more than look around me to visualize the myriad decisions that I and my purchasing team would need to go through.  We’d have to find and source vendor relationships to support products and services such as:

Beach equipment – Who provides all the beach chairs, cabanas, and umbrellas that support our days of leisure?  What about the chairs and tables for the weekly outdoor luau, and the carts to move them? Who repairs this equipment after storm damage and normal wear and tear?

Towels – Where I was staying, every resort visitor gets two beach towels and can turn those in daily (or more often) for fresh towels.  Where does the resort buy those towels?  Who washes them? If it is the resort, then who supplies the laundry equipment?  The laundry soap and fabric softener?  Or, do they use a third-party service?  Same goes for towels, dish towels, and linens in the residence units.

Pool – Who maintains the pool?  Where do the chemicals come from?  Who repaints them?

Restaurant – One could dedicate a whole blog to food service.  Our resort has two restaurants, a pool-side bar, and a small convenience store/fast-food outlet.  How are they learning where to buy all the food and supplies for these facilities?

Furnishings and Appliances – Sofas, chairs, tables, beds, carpet, sliding glass doors, balcony tables and chairs, kitchen appliances, laundry appliances, and air-conditioning systems.  Where do you buy things?  Who services the appliances and air conditioning?

Communications – TV, Internet, and multi-function phones (the latter being overkill and mostly used for messages from resort staff).  Who is the ISP?  Who provides the connectivity?  Who wires the resort and maintains that wiring?

Golf carts – Not for the golf course – that, too, could be another blog.  But, golf carts used by resort staff to move supplies around.

Maintenance – Lawn mowers, tree trimmers, tractors for raking the beach, grass trimmers, leaf (and sand) blowers), painting, cleaning service.  Where does all of this come from?

And the list goes on.  Maybe we are sourcing some of these services from our local community for local use. Maybe we are helping the corporate office to source for regional or global distribution.  Our team is going to receive dozens of solicitations for each of the many products and services listed above.  We’re likely not satisfied with some of our current vendors, so we’ll be actively looking for replacements.  Other vendors will be trying to get us to replace vendors that we are currently using.  How do we make our decisions?  How do we decide which vendor calls to take?  How do we know which vendors to trust?

Referrals cut through all of this complexity.  Putting myself in the mindset of a prospect, if I hear from a colleague at another resort down the shore, or if a business acquaintance that I met at a hospitality business conference contacts me, I will listen.  If they tell me about good results from a service provider, I am going to listen harder.  I’ll respond to an email or return a phone call from someone I know, even a passing business acquaintance, ten times faster than any other solicitation I receive each day.  These are people with whom I already have a connection, and I’m going to listen seriously to their experience and the basis for their recommendation.  That’s why business referrals work!

The reality is, referrals are an important part of your prospect’s buying process. If you aren’t providing your customers and buyers with effective ways to give and get referrals, you’re missing the boat.

Now that I’ve got that off my chest and out of mind, let me get back to my Mai Tai.

Questions? Email me at LBloom@amplifinity.com

launching a referral program

How widgets limit your referral program’s functionality

Are referral widgets just a vanity application?

Referral widgets have become a widely adopted approach for businesses so you may be considering whether this is the best path to launching your referral program. But unless you’re an ecommerce company concerned with only tracking a single transaction and not interested in generating repeat referrals, widgets fail when applied to referral programs.

In fact, when widgets are applied to most B2B referral programs they become more of a vanity application than anything else. Like vanity metrics, widgets’ trending popularity in the technology sphere might make you think that adopting the widget strategy will improve engagement since it has no barrier to refer. But for B2Bs, widgets fail to prompt and capture repeat referral action and data which is essential to a successful referral program. While a widget makes it easy for customers to make a referral, it only does this by dramatically reducing the amount of valuable information you acquire.

A full referral program however, captures customer and partner information in order to build a mutually beneficial relationship and increase the value of referrals, generate and close a higher number of referrals, and obtain repeat referrals from the same costumer.

Check out these 7 questions to help you decide if a widget is really what you want or will just act as a vanity application.

7 Questions to ask when considering a referral widget

  1. Will a widget inhibit referral program data collection?

 

Yes. With a widget, there is no referral program registration. Program registration provides deeper understanding of your advocates and repeat referrals. The information you collect at the time of referral using a widget is usually the bare minimum necessary to track and fulfill a reward. Typically this is just an email address. The gathered information is more concerned with delivery of the gift card than creating a relationship with your advocates.

 

  1. How does qualifying leads change with a referral widget compared to a full referral program?

 

With a widget no advocate profile is created, which means that you cannot see top advocates (other than email addresses). Additionally, there is not enough information to pass into Salesforce to match up with a contact. Therefore, no advocate data exists in Salesforce. That also means no Advocate name listed on the referral lead so you can’t contact them to prequalify the lead.

 

  1. But wait, can’t we just collect the name and create a profile each time a customer or partner use the widget?

 

Sure, but then you are forcing them to register each time and they might change their contact information so you have no way to ensure that their data will be combined properly. Furthermore, this would eliminate the fundamental advantage of the widget that it is a simple process. Once you add registration, you might as well not use the widget.

 

  1. Hold up, if it is an SSO system, can’t the widget talk to that system and get the info?

 

This is possible, but only with so much dev effort that it eliminates the value of the widget being easy to drop in. One company I talked to about this strategy attempted to do this and had to develop an entire page solely focused on supporting their new widget. It took so much dev time and effort that they never were able to implement the widget on any other page.

 

  1. Does adopting a widget based strategy introduce any security concerns?

 

Yes. Another issue with widgets is that they open up your website to the potential of getting hacked. More specifically, your website is at the mercy of the security processes and standards of the company developing the widget you are adopting. To avoid this issue marketers should make sure the widget goes through a comprehensive internal security review to avoid introducing any security risks to their web properties.

 

  1. But widgets at least are always available and visible to a website visitor right?

 

No. Another limitation of widgets is that they don’t always work when a web visitor has ad blocking turned on. About 20% of web users today utilize ad blocker technology, which means 20% of your visitors won’t be able to refer.

 

  1. So how do widgets keep customers or partners engaged in the referral program?

 

They don’t. Another issue with the widget is that you can’t accumulate rewards. Since the widget tracks the single referral and not the advocate, you can’t use reward structures such as monthly commission checks. This also discourages repeat referrals.

At Amplifinity, our platform is designed using a relationship focused sales approach, which means that providing you the best data while creating a good experience for the customer and partners who are referring you is our top priority. And with the option of single sign-on (SSO) we lower the barrier of entry into the referral program to make customer and partner referrals seamless. Learn what features will increase your referral program ROI by checking out our features page and requesting a demo today!

 

ROI Calculator

Questions? Email me at JSwenson@amplifinity.com

Originally appeared in Customer Think

How to grow a software startup without marketing

I feel a little “Benedict Arnold” writing this as I make a living as a Marketer. However, it has become glaringly obvious to me in the past few years that early stage startups have some interesting opportunities to stimulate growth without needing to invest scarce funding in Marketing headcount. When the company takes off, by all means get some Marketers in to help scale. In the meantime, here are the key things you need to do.

1. Build a website
I think everyone gets this one. You need a website, but don’t outsource this! The one hire I recommend you make is a Digital Marketer who gets how to build a lead converting website, understands SEO and SEM.  Your website needs to be a dynamic part of your marketing strategy where you are constantly working to improve traffic to your site from organic search and conversion once they get there.

The next step in maturity once you have the funds will be to make sure you show up in search for the key buying terms for your product. Again, do not outsource! Make sure your Digital Marketer is Google certified and knows their stuff, then turn them loose. They will get farther than any agency because they understand your product(s) and are a part of your business.

2. Keep software to a minimum
Vendors would have you believe that you need marketing automation as soon as you start generating leads. But really, you don’t need it until you are much larger and even then you might not need all the bells and whistles that marketing automation is based on. If you want to email product releases to customers, just use your email system. Lead nurturing with email is starting to become an outdated practice as prospects are filtering and ignoring vendor emails as a standard.

That means that email marketing software (the simple version of what marketing automation is based on) is no longer a must have either.CRM is a tougher call. You are going to want to keep track of your customers and you’ll want CRM functionality as you grow. There are some inexpensive entry level products for startups. But don’t be bullied into it. The important thing is to keep a clear record of your customers, their contact information, the product(s) they have and a way to keep basic notes on your interactions with them. You will have turnover and you’ll want to make sure that customer IP doesn’t leave with your employees.

3. Start a referral program
So if you don’t have marketing, how are you going to grow your business? The answer is with a referral program. Uber, Dropbox, AirBnB and countless others achieved growth via referrals. It works because your happy customers are doing the marketing work for you. They are finding the right prospects that are interested in your products. This is critical to helping you scale because you don’t have the money to have the few precious people who are selling chase down a bunch of bad leads. You need them focused on the highest quality leads and referrals from people who already use your product are the answer.

This is the one place I recommend you invest in a solid referral software solution that can grow with your business. The reason for this is because tracking referrals is not an easy thing. You need to connect a prospect to an advocate across multiple digital avenues and through the sales cycle. If anything breaks or is missed, you can easily give your once happy customers a very disappointing experience.

4. Spoil your customers more than your kids I can’t stress enough how important this last step is. Gone are the days where customers use your product and are satisfied that’s enough. They expect you to delight them. They expect you to treat them like they are precious and valued. This is particularly true in software where you have a long term subscription relationship. You constantly have to be earning their business.

So what can you do? Be proactive and give them value beyond what your product does. Don’t wait for problems to come in, solicit feedback from customers often. Invite them to focus groups with their peers to discuss how to use the product or how it can be improved. Monitor your customer’s use of your product and consult with them on how they can get more value.

And of course, random acts of kindness don’t hurt either. Call them to congratulate them on a successful referral and make them feel special. Send something fun to them in social media or via direct mail just because. If you aren’t giving them all the love and support that a parent would, they just might start thinking they aren’t wanted and take their business elsewhere.

ROI Calculator

Care to further the discussion? Tweet me @Trishawinter

Software ROI that’s a piece of cake to measure

Throughout my 20 years as a marketer, the hardest question to answer has always been “Can you prove that this [insert latest marketing program or technology] is going to make us money?” Even with all of our current capabilities to collect data, there are still many areas of marketing where the honest answer is “We can’t prove the “it,” but we believe this will help us.”

Unless you’ve done “it” before, you have to rely on reference calls with a star customer to prove that “it” works. Kind of a skewed representation of value, which doesn’t always help you feel confident that your new initiative is going to move the revenue needle.

The good news is that with all of today’s capabilities to collect data, software companies are able to collect the information on how effective their product is for their customers. If they’ve got some good analysis behind it, they can even predict your results.

Here are some questions to ask the next time you are looking to bring on a new technology:

  1. What is the average result for a company of my size/situation?
  2. Is there a wide variation in that result across your customers?
  3. What bottom line cost savings or top line revenue growth can I expect to see in year 1, year 2 and year 3?
  4. What ROI can I expect to achieve in year 1, year 2 and year 3?
  5. What are the key factors that affect ROI year over year?

If you just read these question and scoffed because you don’t think any company can accurately predict how their software will affect your revenue, think again. Amplifinity has analyzed all of the data on its referral automation platform over the past 3 years and can provide this information based on real customer use. If you are tired of not having a solid argument to drive your ideas for demand generation, I encourage you to test drive Amplifinity’s ROI Calculator. Just by inputting the number of your customers, employees or partners and identifying your average annual revenue for a single customer, the calculator generates your predicted results based on real customer data.

If you are dealing with a vendor that can’t provide answers to your ROI questions, you might want to think about changing your investment to something like referral software that can truly demonstrate success.

ROI Calculator