HomeBusiness InsightsRewarding Your Customers: Part Two

Rewarding Your Customers: Part Two


“Spread the word!” If you’re a small business owner and want to bring in new customers, chances are you’ve uttered these words on more than one occasion. Let’s face it – no matter how exceptional your product or service, you’re going to have a tough time generating new business if people aren’t talking about you.
refer a friend

That’s where referrals come in. Have you ever been impressed by outstanding customer service or a product/service that goes above and beyond your expectations? It’s likely that you’ve excitedly told your friends, colleagues and family members about your positive experience so that they, too, can be blown away. In this regard, referrals are a powerful thing. Word-of-mouth recommendations from a credible, unbiased source will almost always be more influential than a company-sponsored radio ad or television commercial.

From a business perspective, this is a golden opportunity – prospects know about you, they are under the impression that you are good at what you do, and they will likely contact you when they are in the market for your product or service. The best part? They are often completely free. 

Customer referrals are becoming increasingly important in today’s Internet-dependent society. With just a click of a mouse, potential clients have access to websites and reviews that can either help or hinder your business. That being said, if you’re a 10/10 company in all aspects and no one refers you or even knows about you, it will be difficult to grow on a grand scale. 

Additionally, not everyone who comes across the best kept secret in town passes on the information to those closest to them. Quite simply, people get busy and they forget. That’s why deliberate planning in the form of referral programs can go a long way in securing customer recommendations. By utilizing a pre-planned program complete with rewards, you incentivize the referral process and increase the number of leads. 

Here’s a good way to make a referral program work:

Step 1:  Make your customers happy. You aren’t going to get many referrals if you don’t set the bar high. Excellent customer service should always be a top priority.

Step 2:  Communicate with your current customers about your referral program via e-mail, advertisements, phone calls or direct mail. Let them know that if they tell a friend about your company, and that friend ends up making a purchase, they will receive a reward. This reward can be in the form of savings, cash back, or anything else you desire. Ensure that communication happens on a regular basis. You may want to consider having a standard tagline (e.g. “Refer a Friend and Save!”) on all receipts and invoices to ensure that this information doesn’t get missed along the way. 

Step 3:  Track purchases to assess which new customers are from referrals.

Step 4:  Reward customers who bring in new clients through their recommendations. Some companies choose to reward the new customer as well. 

You know you have a great company, so why not spread the word? Set aside some time to structure your referral program in an organized fashion. By offering your customers incentives to talk about their positive experiences, you will likely see an increase in business.

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