4 Reasons Why Having A Referral Program Is Awesome

For a lot of businesses, word of mouth is the most important way to market their company. Unfortunately, beyond social media, there’s very little that a particular business can do to control that. Once a customer escapes the confines of your business, there’s very little incentive for them to tell all of their amazing friends about how brilliantly on point your car service was, or how impeccable your floral designs are. Sure, they are definitely impressed. You know that because they told you so. And they may even off-handedly mention you to their frien

But what they’re not doing, probably because they have no reason to, is referring their friends. Convincing people that they know to get their car serviced at your respective shop, or that they should use your decorating services for their wedding. And reason why is because you don’t have a referral program. You offer them no reward for doing so, so why should they help you out? Here are just a few reasons why having a referral program can be extremely beneficial for your business…

1. (Most) People Trust Their Friends

Typically, when I want to know the name of an excellent Mexican restaurant in my area, I turn to my friends. I ask them, “what’s a good Mexican restaurant around here?” in a droll, unsarcastic manner, and receive several answers in mostly incomprehensible paragraphs, wrapped in three layers of sarcasm. Sigh.

Then, because I can only trust my friends so much, I turn to Yelp or Urbanspoon in order to find out if their recommendations actually check out.

Still, I trust my friends significantly more than I trust anyone on the internet. That’s why referral programs are so important. Yelp and Urbanspoon are great, but nothing is more influential than a solid recommendation from a friend. Referrals give those friends a greater incentive to urge and harass their other friends into doing business with your company, while simultaneously increasing their likeliness to do business again with you in the future simply because of the added bonus you’ve given them.

2. Referrals, While Similar, Are Not Coupons

There’s something oddly unsatisfying about using coupons. Maybe it’s the fact that, typically, they are given to you. “Get 20% off for being you!” an ad in the PennySaver reads. Too easy.

Referrals, on the other hand, are earned rewards. They provide a means for flexing my influence and savvy in convincing my friends to visit a particular restaurant.

And earning something is rarely ever an unsatisfying experience.

3. Referral Programs Are (Usually) Cheaper To Implement

Whereas coupons sometimes require your business to place ads or purchase print material in order to market particular coupons, referral programs typically just require you to inform your current clients. Fortunately, that’s something that can be done in a simple e-mail blast.

4. Referrals Create More Potential For Repeat Customers

Depending on your particular industry, customers may seek your business out as much as once a week, if not more. Still, there may be other, equally qualified consumers that visit your business far less.

Referral programs are a great way to change that, and turn those every-other-monthers into every-other-weekers, or, even better, every-weekers. A referral program grants them greater incentive to do business with you on a much more frequent basis. Additionally, it grants you an opportunity to ‘wow’ their friends, and turn them into loyal customers of your business.

Referral programs, like most incentives, are intended to provide consumers with discounts in order to simply get them into your business. That’s their ultimate goal.

But they also have some hidden advantages that aren’t necessarily inherent within simple coupon discounts, including the ability to drastically increase customer loyalty.

The most important thing to consider is just what sort of impact a well-executed referral program can have on business because, in some cases, it can be monumental.



Source: MSM DesignZ, Inc. is a Westchester NY web design firm specializing in SEO, social media, web and graphic design and much more.