Referral Programs
“Your firm probably doesn't need as many new prospects as you think you do--you will generate more impact if you reconnect with the people who already know and trust you.”
- Seth Godin, Get out the vote
“Referrals are the single best and most profitable source for new sales. They're also the least used source. Why? Because they require work.”
- Jeffrey Gitomer, Referrals Defined
“No other sales or marketing strategy delivers such powerful, predictable results. Yet, 95% of companies do not have a written referral-selling strategy, written weekly referral goals, a plan to develop referral-selling skills or a system to track and measure referrals. Referrals are the missing link in every company's business development strategy. It's time to make referrals the primary way your company attracts new clients — and to move referrals from afterthought to priority.”
- Joanne Black, The Magic of Referrals - LifeHealthPro
Your best source of leads come from word-of-mouth and referrals from current clients. Are you going above and beyond your clients' expectations? Do they really know how much you appreciate their business? Do you deliver remarkable client experiences, that not only foster long-term retention, but also motivate them to refer their family and friends?
Do you regularly ask your clients to recommend you?
Do you track where all referrals come from?
Do you have a process in place where you can quickly thank a client for recommending you?
Do you ask your clients to give you positive reviews online?
Recommendations
Review your current referral program. Is it working? Can your employees easily explain it?
Roleplay with your team. Have them practice asking each other for a referral. How did they do? At first this may feel awkward, the more you ask, the more natural it will become.
Do you have a process in place to ask every client to give a verbal commitment to refer?
Use the NPS campaigns to measure how you're doing. Your clients can rate their likelihood to refer you to a friend and family member. That is your NPS (Net Promoter Score). If they leave a score of an 8, 9, or 10, they also receive a follow up email asking them to leave a Google review. Reach out and ask them for referrals! If you receive a low NPS score, call them and find out why and try to turn it around.
Building a Referral Program
Brainstorm with your team:
- What are you selling? To whom? (Identify your ideal client)
- How, where, and when, can prospects and referral sources find you?
- Why is your agency great, and what sets you apart from the rest?
- How often and when will you ask for referrals?
- How do you wish to track and incentivize the program?
Determine available referral resources, such as:
- Chamber of Commerce and community organizations
- Real estate and lender professionals
- Financial services groups
- Captive Agents
- Professional relationships and networking contacts
- EB and CL producers
- New and Existing Clients
- Carrier Referral Programs
- Builders, Property Management, Associations
Ask for referrals on your business cards, on your voicemail greeting, email signature, on your website, on social media, in welcome letters, and more.
If you are going to offer money or gift cards, it is very important to know how much you are allowed to give in your state. It is also important to communicate that there is not an obligation to purchase in exchange for the referral gift.
Tips for a Successful Client Referral Program
Client referrals are an easy and effective way to build your business. Here are some best practices to help you develop your referral program.
Get your office on board. A successful program takes the support of the entire office, make sure everyone is diligent about asking for referrals. Inter-office contests can help stimulate your referral program, drive business, and cultivate a strong customer service culture.
Track your referrals. All the best referral agencies track where their new business comes from. They know each month how many referrals came from clients, mortgage companies, captive agencies, and other sources. Consistent tracking will help you target and focus on what's working for your agency as well which clients are enthusiastic about your business.
Communication strategy and style. Always tie the referral program to a personal monthly communication plan that is NOT full of insurance tips. Your personality is what drives the quantity of referrals. The more your clients know about you personally, the more they can share about you to their friends and family. And remember, the best referral program agencies all say having a monthly newsletter or communication featuring their referral program delivers the biggest consistent boost of new referrals.
Reward the behavior. Reward the behavior of referring. Have a referral bonus or incentive program for employees. When rewarding those that refer clients to you, outside of the agency, know your state laws on how much you can give. It is popular to tie your referral program to a charity. Be aware this can be challenging unless you have a clear established process in place. There are many other ways you can support social causes in your community and build goodwill.
90% of consumers will switch to companies that support a social cause.