When you’re preparing to make a large purchase, don’t you love getting a recommendation from someone you trust? With the big-ticket sales going on in the B2B world, referrals are even more important. In fact, according to one study, 84 percent of B2B decision makers start the purchasing process due to a referral. And sales leaders agree: referrals close 70 percent faster and have a 59 percent higher lifetime value.
If your business doesn’t currently have a referral program in place, it’s time to build one. So, how can your B2B business see success with referral marketing? Here, we’re going to discuss eight steps that will take you through the process of creating a successful referral program. You’ll learn:
-What you need to do to prepare the groundwork.
-How to set up a referral marketing program that works.
-How to maintain your referral program into the future.
By the end of this guide, you’ll be fully prepared to launch a referral program that brings in new revenue to your business.
Preparing the Groundwork
1. Develop Your Current Customer Relationships
Before you even think of creating and promoting a referral program, you need to make sure that your customers actually want to refer you.
That’s why developing your customer relationships right from the get-go is the first step in building your referral marketing program.
Once a sale is complete, don’t put that existing customer on the back burner. Show them you care by keeping in contact.
For example, as a new customer learns how to navigate your software, check in regularly to make sure they understand how to use your product to the full.
Be attentive to the needs of your existing clients, and be genuinely helpful. This will give existing customers a good impression of your business right from the start.
When your existing customers are happy, you’ll have a much greater chance of success when promoting your referral program to them.
2. Get Relevant Feedback from Existing Customers
Another way to prepare for a successful launch of your referral program is by asking for feedback about your product or services.
Using a simple Google Form, you can create a quick survey with short, easy-to-answer questions.
The key here is to be specific: ask what users like about different aspects of your product or service, if the design makes them feel more productive, or whether they have any suggestions on how to make the interface more user-friendly.
These specific questions will be easier for customers to answer and will give you a better idea of what makes customers happy. Later, do your best to apply these suggestions.
This has a two-fold benefit for your business and your referral marketing strategy:
First, asking for the opinion of your existing customers makes them feel like you genuinely care about them and their experience with your product. Then, when making an effort to apply their suggestions, they feel included and appreciated.
This in turn helps warm them up to the idea of referring others to your business.
Second, asking for the opinion of current users could get you some really great ideas for how to improve your product.
3. Decide Which Customers to Target
During all of these interactions with your current customers, it’s good to take some time and decide which ones you will target when you launch your referral program.
Instead of sending waves of emails to all customers, focus in on the customers who are most likely to refer your company to others.
How do you know who to target?
Here are three traits to look for in customers that are primed to become referrers:
The customer leaves positive reviews or feedback. Obviously, the first trait of a potential referrer is that they are actually happy with your product.
It’s time to go back to that survey you took of your existing clients. Based on the answers that they gave you, which customers seem to be most satisfied with your product?
Also, find customer reviews on forums and SaaS review sites. Who are the customers that are currently singing your praises?
The customer is actively using your product or service. Customers who only use your product once in a while may not be familiar enough with it to refer it to others, or they may not truly enjoy the experience.
Obviously, those customers are not likely to refer new customers to you.
Use tools like Google Analytics to see which of your current customers are constantly visiting your website. Or, add a question to your survey to find out which customers use your software regularly.
The customer has been with your company long enough to know the value of your product. New customers shouldn’t be part of your target group for a referral program. Try to narrow your list to customers who have been using your product or services for at least a few months.
These are the customers that have experience using your software, and they know just how much value your product brings to their business. That makes them more valuable as referrers.
Set Up Referral Marketing for Your B2B Business
4. Make the Referral Process Easy for Referrers
Sending a referral should be an easy process for your customers. The more difficult the referral process, the harder it will be to get people to refer.
So when you start sending out emails or making calls to promote your referral program, it’s essential that your customers understand exactly how the referral process works.
For example, let’s say that a particular code is necessary during the checkout process in order for the sale to be recorded as a referred sale. Make sure that the code is something that’s easy to remember, such as the name of the business that referred that new customer.
For an even easier approach, give your referrers a link that they can share by email or on social media, making that link trackable to their customer account.
However, if you decide to track referrals and trace them back to their original referrers, make sure that the process is quick and easy for both parties.
5. Show Your Appreciation with a Reward
It’s time to dangle that carrot in front of your customers: what are you going to give them in exchange for referring new customers to you?
There are plenty of different options when it comes to referral rewards. Here are some ideas:
Discounts: Every business loves a discount. For example, if your product is subscription-based, you could offer a discount on the subscription cost for a period of time (one month, six months, etc.) in return for a referral.
Features within your product: Rewarding your customers with expanded features within your product opens you up to some interesting possibilities that won’t cost your business money. For example, as a reward for a new referral, you could give referrers a free upgrade for a limited time.
Dropbox does this by giving referrers 500 MB of extra space for every new referral. This is a perfect reward for that product’s users.
Free training: Whether it’s in the form of a webinar, an online course, or a free 1-on-1 conversation with an expert from your company, giving away free training is a great incentive. This could be training on how to use your product, or training in the area of expertise that your business deals with.
When deciding on the best reward to offer in your referral marketing program, the key is to find balance. Choose a reward that will be attractive to your customers, but won’t cost your business an arm and a leg.
At this point, you’ll also need to decide whether the reward will include your new referred customers as well. Offering a benefit for the referrers as well as the referrals gives greater incentive for making new sales.
6. Automate Your Process for Capturing and Qualifying Leads
Once you’ve prepared your referral program, it’s time to decide how you’ll capture and qualify these new leads efficiently.
New referrals need to be cared for quickly, which is why automating your lead qualification process is essential.
Connecting the tools you use with a workflow automation tool like Zapier ensures that these new referrals get sent to your sales team right away.
Also, you can qualify leads quickly by finding out something about their company right within the lead capture.
For example, if referrals are sent to your website through a special link, you can send them through a fast questionnaire that allows your sales team to get some insight before they make contact.
Maintain Your Referral Marketing Success
7. Split Test Your Referral Program
Just because your referral program is up and running, doesn’t mean it’s time to sit back and relax.
Now it’s time to make sure your referral program is reaching its full potential.
Start by setting your key performance indicators (KPIs). These could be metrics such as participation rate among your targeted customers, response rate, the ratio of referral invitations sent to new referred customers, etc.
Once you have your KPIs in place, track and analyze the results of your referral program.
Now, you have a baseline to work from. At this point, try switching up variables to see what works best. For example, try testing the results with a different type of reward, or a different referral process.
Split testing these different variables will help you see what works best both for your customers and for the people that they’re referring.
8. Analyze and Refine Your Customer Relationships
In any business, it’s essential never to become complacent. Just because your customers are happy today, doesn’t mean they will be tomorrow.
That’s why it’s your job to continue to improve both your product and your customer relationships. Follow through on step 1 by continuing to develop your current customer relationships. Keep sending out surveys to see what people like and dislike about your product.
By doing this, you’ll live up to the expectations of your new referrals.
Conclusion: Make a Success of Your B2B Referral Marketing Program
Creating a referral marketing program that works and sticking to it is a proven method to boost your company’s revenue.
Are you ready to get new leads, close more sales, and get more satisfied customers on board with your company?
Follow the steps above and you’ll have a referral marketing program that’s successful now and into the future.
Emil Kristensen is the CMO and co-founder of Sleeknote.