As marketers and salespeople, we all know the power and impact of word-of-mouth on our business, yet we still struggle to leverage it. Why? Because it’s hard to measure, difficult to systematize, and seemingly impossible to monetize. While these challenges exist in some cases, Amplifinity continues to prove every day that the best way to solve them is through closed-loop referral marketing programs. Before launching another mediocre referral program that will fail to drive meaningful long-term lead volume, consider these three common referral program mistakes:
#1 – Failure to support them with the right systems, processes and strategies
Marc Benioff, CEO of Salesforce.com said it best: “Although every company knows customer references are important, most companies have a lax approach to managing them.” Just like any other marketing program a referral program must be well strategized, tested and continually optimized to ensure peak performance. And when you automate a referral program and take the manual tracking and management aspect out of the equation, the results are even better.
Takeaway? You can’t just ‘set it and forget it’ and expect good, long-term results.
#2 – Lack of executive sponsorship
Typically, a referral program is initiated by an executive and handed off to a junior-level employee to drive – often without the proper knowledge or bandwidth. As a result, the program is launched haphazardly and left to run itself. Sure this method can provide average results, but we all know average isn’t gonna’ pay the bills.
Takeaway? Referral programs that are continually improved upon – and viewed as long-term acquisition channels have the power to produce just that: ongoing and sustainable customer acquisitions.
#3 – The Black Hole effect
In order to manage lead volume and quality, it’s important that every customer, prospect, and sales rep enrolled in the referral program is kept in the loop regarding the status of their referrals and any incentives tied to them. When referrals are made and disappear into a “black hole,” engagement plummets, operational costs of managing escalations increase precipitously, and the program loses credibility.
Takeaway? Customers who refer new business to you are your BEST customers. Regular communication and nurturing them results in satisfied, high-producing additions to your company’s “sales team.”
Do you have a tip for building successful referral programs for your business? We’d love to add them to our blog!