This article outlines the best practices that we recommend to increase the chances of referrals and new customers!
Choosing the Ideal Advocate
Not everyone who walks through your door is necessarily going to be the right fit for your Referral Program. To save you time and resources, you should try jotting down an idea of the kind of customer you think may be ideal. Perhaps they are in a certain age range, or have spent over a certain amount, or are a regular user of your service. There are a multitude of factors, but only you will know best the type of person who would best fit the Referral Program. Of course, we are happy to help guide you through this process - just ask your OneLocal Marketing Specialist!
Once you've determined your ideal Advocate, the next step is figuring out the reward that will best entice them to invite their friends...
Offering the Right Reward
It's important to choose a reward that will be appealing enough that your Advocate will want to take the time to invite their friends. Now that you've identified the Advocate you're trying to attract, what do you think they'd prefer? A discount or a gift item? We can customize the reward to exactly what you want.
We've noticed that successful LocalReferrals users tend to offer at least 5% of the LTV of the customer. So if your customer typically spends around $400 during their entire lifetime as a customer, you should aim for a reward that is $20 or above.
Benefits of a Two-sided Reward
Getting the Advocate to participate in the Referral Program is only half the challenge; the Friend needs to be offered a reward that is enticing enough that they will want to reach out and use your services, or buy your product.
This reward can be the same as the Advocate's, or depending on your business, it may be smarter to offer the two parties different things. Just keep asking yourself: What do I need to offer my current customers to get as many new customers as possible?
Sending the Requests
Knowing the right time to send requests to potential Advocates is crucial. You don't want to wait too long, but you also don't want to bombard them (especially if you are concurrently using LocalReviews). If you're unsure about when would be the best time, do not hesitate to contact your OneLocal Marketing Specialist.
LocalReferrals gives you the option to send the requests over email and/or SMS. Interesting to note, research has found that 98% of SMS messages have a response rate of 45% while open rates for emails are now 22% with a much lower response rate of 6%. This means that more 3 times the people are reading your messages than opening your emails.
If you aren't collecting and storing your customer's phone numbers, now may be the time to start! That being said, email is still a super viable channel to reach out to clients.
Marketing & Promotion
Getting the word out to your customers about your new Referral Program is really important. This means that you won't have to solely rely on having to send out requests yourself, instead you can attract people through other marketing avenues. Why not print out a few posters and display them around your store? You could hand out flyers, put a blast out on social media or even put it in the header of your website!