Many a time, we have heard of the term referral program, and that has left many puzzled as to what this program is all about. Over the years, referral program has been a means of livelihood for so many, and has also contributed to the growth of many companies the world over.
In the course of this article, we are going give a thorough breakdown of what Referral programs is, the different type of referral programs we have and why we strongly recommend it to you our dear reader. Let us start with the first question:
What is a Referral Program?
A referral program is a type of business strategy that a company pays someone for referring or directing a client to enjoy the same opportunity they also had with a particular company. A referral program is also known as affiliate programs in the online world, where a certain amount per sale is given you for simply telling someone about a product or service.
It can also be seen as a bonus or extra money earned, if you decide to do the program part-time or just passively spreading the word about a product.
It is very much true that this method is often a business agreement that companies use to get customers, it can also be used to retrieve employees. However, small traders also take advantage of this, as giving referral incentive do not always mean giving money.
Referral incentive can also be in the following forms:
Why the need for Employee Referral Program?
Big companies need not direct their attention only to customer referral programs, so as to get more clients patronizing them. They are strongly advised to also set employee referral program as a method for showing appreciation to all those who have dedicated their effort in finding the perfect people to fill in vital positions in the company.
Research has shown too that, Employee referral Program is still one of the most powerful tools when it comes to recruiting. Not only does it help the find right resource persons for the job, it also helps to cut down the habit of sentimental style of working (i.e. like most employees are referred by a friend will likely stay because his/her friend is also working in the company).
Another reason why employee referral program can not be overemphasized is the fact that, if your employees are dedicated, determined while handling their work, there is an undeniable truth that they will hang out with people of like minds and attitude. This agrees with the belief that says “the same springs another gang”
Best way to create an Effective Referral Program
Having a customer referral program in place in your business is a great way to get new customers. Whether you are a lawyer, a realtor, a doctor, an insurance agent or a great marketing business, you should start getting ideas about how this program and how to ensure its effectiveness. Here to keep some things in mind when starting a customer referral campaign:
A very good methodology in getting new clients or customers trooping into your place of business is via Referral program. No matter the profession you might be in, finding the in-depth knowledge of how the referral program works and starting making it a goal.
In starting up a good referral program, here are some tips you should have in mind:
Tenant Referral Program
Just as the name implies, it is a tool to minimize the vacancy. Your tenants, if they still live in your home, or they already left, can say things about you and your home. So you need to make sure they say only nice words! This is where a tenant referral program goes.
It is built on a network chain, whereby an owner will give incentives to their tenants as they direct a friend or family to rent a vacant apartment or building. These incentives may come in different forms, but the most common examples are giving rent discount, making grocery certificates of nearby establishments, gas station discount tickets and free laundry and dry cleaning service for a certain time.
These referral programs are actually very important, because your tenants are representative of your home. What they say about your house can make or break your business.
AT & T Referral Program
Top companies also have referral programs. They usually put a client or customer referral program in place especially when there is a new product that needs promotion, or if they simply want to expand. One of the major companies that offer referral programs AT&T.
AT & T is a telecommunications network that offers telephone and Internet services, among others. Because of their frequent innovation, they launch new products every time, so they are also very keen on promoting these products to their market at large. The company knows very well that their existing customers are their best sellers so they provide them with these programs.
One of the referral programs AT & T offers is the Uverse product. In this program, existing customers will refer a friend or family member to patronize the company and the customer gets a token of $25 for each referred person who activates their service with the company.
Sprint Referral Program
Another very catchy promoter of referral program is the Sprint Company. In fact, Sprint has a very strong network of referral program in place, because it is not only the current customer who refers a friend that gets an incentive, but also the person he referred. That's $20 for the customer, and $10 to the friend referred.
However, there are some conditions on which the Sprint referral program operates:
They will only be given if both phones will be active in the Sprint network for 30 days.
Everything Plus Referral Program
Interestingly, Sprint has a referral program that is quite popular with customers who want everything in this business. What is The Everything plus Referral Program all about? Sprint explains on their website, the customer can save $840 per year. What differentiates this type of referral program from others is the fact that an employee of Sprint is the only one to refer who is qualified to refer a person. What does that mean? It simply means that, to take advantage of this program, the potential customer should be invited or called by an employee of Sprint, as the employee ID or CID is needed for the application.
Referral programs from other companies
Building a successful referral program is not relegated to the top notch companies discussed above, like Verizon FiOS, Microsoft, ING, Scottrade, Mozy, Avant Link, Amtrak or Google Adwords etc., No! Anyone can, other smaller names also succeeded in making this work. From broker to contractor to agent’s mortgage, smaller software companies and physicians looking for a patient, and even government offices have found that referral programs are truly effective. But you should be aware of the pros and cons that go along with this program, because it costs money. But for those who have the capacity to venture into this style of business, it is a long term means for sustenance.
Some of the entities that operate referral programs are the US Army, Child Care Resource, Tissa, Neopets and Dropbox.
Studies have shown and also suggest that Referral is liable to failure. Of course, nothing is fool-proof. However, if you have studied the programs to implement it, then chances are that you will succeed.
What's more important is that you keep your business integrity and your customers satisfied. In the end, it is what will make your customer and what they will do reflects on how they feel about your business or services.
Referral programs further helps to show firsthand how satisfied your customers or employees are with the company. With a good business relationship and the right incentives, you can entice them to make more sales by bringing in more customers and employees capable to get your business running seamlessly.