Want to Know the Secret to Constant Customer Referrals? It’s Simpler Than You Think

by | 22 Jan 24

Have you ever wondered what’s common across the most successful businesses around the world? They’ve all unlocked the power of getting people talking about their products!

Now, you might be thinking, “Surely, it can’t be that simple!” Well, it is, and in this blog, I’m going to walk you through it.

I’m going to reveal a tried and tested 3-step strategy that has been incredibly successful for me in past and current businesses.

Once you grasp this easy 3-step method, referral marketing, also known simply as ‘referrals’, will soon be your favourite and most successful way to generate new leads.

A quick warning: it is simple, it does work, but it does require action!

Table of Contents

Use these links to jump straight to the part of the article that interests you most.

> Step 1: Identify Your Promoters
> Step 2: Use This Offer
> Step 3: Spread the Word
> Key Actions to Implement

Step 1: Identify Your Promoters

Let’s start by talking about the Net Promoter Score (NPS) survey. It’s actually a pretty simple yet powerful tool you can use to gauge how satisfied your customers are. By sending out NPS surveys regularly, at least four times a year, you can get a clear picture of what your customers really think.

So here’s how it works. The survey asks just one standardised question, like this: “How likely are you to recommend us to a friend or colleague on a scale of 0-10?”.

Then, based on their responses, customers are grouped into 3 groups:

  • The Detractors, those who rate us anywhere from 0 to 6.
  • The Passives, those who give us a 7 or 8.
  • And the Promoters, who score us a 9 or 10.

Now, when it comes to referral programs, your main focus should be on Passives and Promoters.

Promoters are your biggest fans. They’re already happy with your service or product, and they’re likely to refer others to your business.

On the other hand, Passives require a bit more attention. You’ll need to dig a little deeper and find out what it would take for them to rate you higher the next time you send out an NPS survey.

Once they tell you, you have them engaged, you’ll be able to follow up and ask these people to refer you too. Don’t forget to address their suggestions for improvements though! Without this, you’ll turn them into Detractors!

Now you have your list of people who are ready to refer you, so move on to step 2.

Step 2: Use This Offer

So, when it comes to the second step, you need to create an offer that’s just too good to pass up. Let me share an offer that has worked wonders for me time and time again: the ‘10% referral’ offer.

Here’s the offer: you give your customers a 10% discount on their next annual bill for every new customer they refer who ends up buying your product. Simple! Put a limit on this though, a cap of 10 referrals that qualify for the 10% discount.

So, if they recommend you to 10 other people who end up buying, then they get your product or service for free next year. One free customer for every 10 new customers. It’s such a cost-effective way to get new customers.

This method is straightforward yet incredibly impactful. It gives your existing customers a real reason to refer you and helps you acquire new customers at a really low cost.

Step 3: Spread the Word

Alright, so now you know how to identify who’s ready to recommend you and you know what the offer is. All you have to do is ask people to refer you.

It’s just like anything else in business. At least, that’s how it’s been for me. It’s all about taking action. You’ve got to take action and approach people.

Without action, success won’t come knocking on your door. So, go out there and ask the people you identified in Step 1 with the offer you created in Step 2.

Remember, a ‘message’ can be an email, letter, video message, or even in a meeting. Or, why not all of those? You’ve got to put in the effort at this stage. Make sure you ask every single one of your Passives and Promoters for a referral.

That’s it. Just three simple steps to go and get more referrals.

Oh, and here’s a very important tip. Never stop doing this. Schedule sending out your NPS at least four times a year. And always be approaching the right people with the offer.

Make it part of your workflow. It’s an incredibly effective and cost-effective way to get more happy customers.

Key Actions to Implement this Referral Strategy

Here’s a summary of the 3 steps mentioned above.

  1. Implement Regular NPS Surveys: Start sending out NPS surveys to your customers at least four times a year. This will help you identify your ‘Promoters’ and ‘Passives’.
  2. Create a 10% Referral Offer: Develop a referral programme offering a 10% discount on the next annual bill for every successful referral. Make sure to cap the offer at 10 referrals, effectively giving customers the chance to get your product or service for free the following year.
  3. Spread the Word: Now that you have your referral programme in place, actively promote it. Don’t be shy about asking for referrals. Use different communication channels to contact your ‘Promoters’ and ‘Passives’, ensuring your message is heard.

Don’t Forget To: Keep the Ball Rolling! Make this referral strategy a regular part of your business operations. Regularly send out NPS surveys, keep refining your offer based on feedback, and consistently ask for referrals.

By following this checklist, you’ll be well on your way to unlocking the power of customer referrals. Remember, the secret to success is taking action. So go ahead, start today!

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