Did you know that 54% of business owners say referral programs for their companies cost less per lead, than any other form of marketing in fact? In your screen-printing print shop, you might not be happy with your leads pipeline. The good news? If you create a compelling referral program built on an amazing customer service experience, you’ll start getting new customers faster than you expect.
The reality is that your next big client could be closer than you think. Your existing customers do business with others and are friends with other business owners. They can refer you to other high-volume clients if they like your work.
“If your customers refer you to someone they know, it helps you gain another great client who’s typically like them: easy to work with and who pays on time,” says Howard Potter, CEO of A&P Master Images. “It’s also cheaper to invest in a referral program, which has a higher ROI and carries little to no risk. With a great referral program, you’ll end up spending less on advertising overall.”
We break down how to build a referral program that will work hard, on repeat, for your shop.
Why Spend Time On a Referral Program?
First, using referrals to gain business should be a no-brainer. It’s one of the lowest-cost methods out there when it comes to getting new customers in the door Beyond that, there are still more reasons to invest in this strategy:
1. Setting up a referral program is quick and easy. Once you set up your shop’s plan, all you have to do is manage it by rewarding those who refer new business to you. It’s pretty simple.
2. It’s a pretty sure bet. A whopping 92% of consumers trust recommendations from friends, family or business associates. All a new customer needs to take a chance on your shop is a feeling that you’re credible as a decorated products business. A referral will give them that extra dose of confidence to trust you with their first order.
“Your referral engine literally starts with that old school great customer experience,” Potter says. “Produce quality artwork and put it on a quality product. Give them a great product selection. Get the order done on time or ahead of time. Treat them with respect. Your customers will naturally promote you without you asking.”
3. Referrals create more referrals. If you get a new client as part of a referral program, they’re able to refer others and so on. In fact, the numbers can grow almost exponentially as the average referring customer invites an average of 2.68 people.
“There’s no glaring secret sauce when it comes to repeat business,” says Lucas Guariglia, co-founder and CEO of Rowboat Creative. “If you follow through and offer superior products, your referral business will continue. With our music industry clients, our team continues to deliver when they’re in a pinch time and again. The word spreads like wildfire because there are a ton of facilities that over-promise and under-deliver. Once a client gets burned, the likelihood that they’ll come back or put the name on the line to refer you is slim to none.”
4. Customer referrals also help you retain the customers you already have. By knowing that their referral matters to you, you keep your current customers happy, leading to a 37% higher customer retention rate than other businesses.
9 Tips to Get Started With Referral Marketing
#1 Develop a business plan. It’s impossible to succeed if you don’t have a plan. “When you develop your approach, you’ll understand your hardline costs,” Potter says. “For example, if someone gets you a new customer who places a $500 order, factor in a percentage for a discount on their next order or a voucher to help them save money on their next order.”
Start by creating a plan that addresses the following questions:
- What do you offer to your customers and clients that make them want to use your business?
- What sets your shop apart from similar companies? (Or can you figure out a way to differentiate yourself from the pack?)
- Who’s your ideal customer? What brings them in and makes them buy from you?
- Who’s your main competitor? What do they do to bring in customers?
- What means of production are most in demand by your customers?
- What are your operating expenses, and how much profit do you hope to make?
- What avenues do you use to market your shop?
- What is standing in the way of achieving your goals?
By coming up with the answers to these questions, you’re on the path to improving and strengthening your shop overall. Revise this plan regularly so you can stay fresh and current.
#2 Pick a referral program platform to make things easier. Whether you’re a newer, smaller or larger shop, managing a referral program can get tricky. That’s why it makes sense to take a look at referral program software that helps you manage your referrals and rewards. Sometimes, referral program software will allow you to enter your clients into the software so they can receive a unique referral link or code to share with their network. Then, once the new referral places an order with your shop using the link or code, then your referring customer receives an email with their discount code or reward.
“If your customers refer you to someone they know, it helps you gain another great client who’s typically like them: easy to work with and who pays on time. It’s also cheaper to invest in a referral program, which has a higher ROI and carries little to no risk.”
Howard Potter, A&P Master Images
#3 Know who you’re targeting. When you worked on your plan, you identified your typical customer. Now, look closely at this definition and identify the customers who place your biggest orders. These are the ones you specifically want to target for referrals. Sure, it would be great to get one or two new small-order customers. But it’s those bigger (or more frequent) spenders that you need to target to bring in more like them.
“This strategy can work as well,” Potter says. “Also consider promoting to clients or industries that have easier work and consistent volume to gain growth, but never limit the program to others.”
#4 Keep your program simple to understand and use. “Referral programs can be too complicated,” Guariglia says. “Our shop’s feeling is that clients and partners should be willing to refer other potential clients to you because they truly feel you offer superior service and experience, as opposed to being solely motivated by monetary or ‘perks’ elements. If you just rely on referrals for perks, you can quickly lose that customer once another competitor offers a better perk. We prefer to align ourselves with solid business based on strong relationships, as opposed to just handouts.”
That being said, you can ask your clients what “perks” they’d enjoy most. Discounts on future orders? Free samples? Free rush order? Depending on what motivates them most, you can create a simple structure for your clients, along with a referral code they can use once they’re eligible.
#5 Focus on customer service. Customer service should drive almost everything you do. “Simply by producing a quality product and getting the order done on time or ahead of time can get you a free customer referral,” Potter says.
Communicate clearly what your customers can expect from you, and do everything you’ve promised to make your customers happy. Then, they’ll be delighted to provide you with a referral because they know that anyone they send your way will be treated right as well.
#6 Make sure everyone on your team works toward the same results. A top-notch referral program isn’t a one-person enterprise. When you set your goals for the referral program, make sure they’re SMART goals (Specific, Measurable, Achievable, Relevant and Time-Bound). That could include emailing or phoning each new client to thank them for their recent order and tell them about your referral program. For example: If you refer a new client to us and they place a $500 order, you get 20% off your next order.
“Gather your team and simply explain the pros and the end goal of marketing your referral plan,” Potter says. “When your team communicates your referral program benefits to your clients, they get excited to learn how they can save themselves money while helping your company grow and gaining other great clients. You might even offer your team incentives for getting new clients through their referral conversations.”
#7 Make your program mutually beneficial. Your rewards can do double duty for both the referrer and the referred. For instance, if you give one a discount or a promotional item to your referring client, send the same discount or benefit to the new client as well.
#8 Monitor your progress. Now that you have your program in place, constantly update and monitor your data. Make sure you’re reaching your goal that you’ve set. If you haven’t, adjust your staff’s approach and rewards to improve your program’s performance.
#9 Promote your program. Finally, it’s essential that you promote your program consistently and thoroughly. No one will be able to take advantage of the program if they don’t know it exists!
“Promote your program in person or via a personalized email,” Potter says. “Otherwise, you look like you’re begging for help by promoting it all over. Plus, if everyone starts promoting your shop at once, you won’t be able to keep up with the volume of new customers. Instead, set benchmark goals for your desired number of new customers and end sales goals.”
A Few More Ways to Promote Your Referral Program
This last point is a huge item, so let’s break it down further. If you have a referral program, you need to promote it. Here’s how:
1. Reach out to all of your customers. One of the best ways is to include it as part of your post-order emails. When you send your paying customers a message thanking them for their order, include information about your new referral program in that email. Make sure to spell out all the benefits that come from referring your shop to others.
2. Let them customize the program. When you give your customers a referral link to give out to friends and family and other associates, let them customize the page that the link takes them to. If they can put their own spin on the layout and message of the referral page, they’ll be more invested in it themselves.
“There’s no glaring secret sauce when it comes to repeat business. If you follow through and offer superior products, your business will continue.” Lucas Guariglia, Rowboat Creative
3. Include testimonials. As part of your referral program, be sure to include actual customer testimonials. This can be in the form of text, or you can get creative and use pictures and video to tell the customers’ stories.
4. Include program information with every purchase. When your customer receives their package, include a referral program guide and code with the purchase. You can also follow up with them a week or two later with a thank-you gift that also includes the referral information.
5. Use your data wisely. Give your sales data a review to determine your top customers. You want to target your best clients to make a part of your referral program.
Word-of-mouth has actually gotten bigger in our internet age. By telling others about your business, you’ll not only expand your sales to include these new customers, but also make your current customers happier and more likely to stay loyal.
“We just keep doing what we do with the same focus, care and attention to detail as when we opened 15 years ago,” Guariglia says. “That’s what makes Rowboat who we are: nimble, fluid, creative and committed. Figure out what makes your shop superior, and keep on doing that to prime the referral pump.”
Laurie is part of the marketing team for the leading supplier in the industry, alphabroder. During her free time, Laurie likes to ride horses, sail and spend time with her husband and her two children. Reach her at Lprestine@alphabroder.com