Marketing is one of a business’s most important endeavors ― but it’s rare that a home-based entrepreneur has time to devote to researching emerging marketing trends and reviewing marketing tools and techniques. Thus, many small business owners and leaders might be unfamiliar with the concept of referral marketing, a growing marketing practice that produces substantial results.
Referral marketing leverages the power of a business’s existing network to strengthen customer relationships and gain new leads. Referrals tend to occur naturally, if spontaneously, as satisfied customers tell friends and family about their experiences. Referral marketing encourages customers to be more vocal by awarding prizes for different activities, such as posting on social media or signing up a friend for service. Referral marketing has the potential to be the most effective of marketing campaigns because it uses the exceeding power of word of mouth ― but only if marketers are diligent. Unfortunately, it takes time, knowledge, and skill to manage a referral program well.
Fortunately, there’s referral marketing software to make developing and managing a referral campaign incredibly easy. This guide will help you understand the ins and outs of referral software, so you can benefit from a referral campaign.
What Referral Software Does
A referral program consists of dozens of working parts: web and mobile sharing pages, internal and external rewards, inbound and outbound promotion, loyalty points, referral codes, advocate tracking, and more. To find success, you must carefully monitor and deploy all aspects of the program ― which is why referral software is so valuable. Instead of manually tracking every action necessary to keep your referral program running, you can trust your software to implement your referral system, even to collect data on program performance, so you can understand the campaign’s real impact.
Of course, not every platform offers such extensive services. There is a handful of varying referral software options, and the services available to your business will depend on the software you partner with. Thus, it is important that you research and compare different programs, so you can obtain precisely those features you need most in your referral campaign.
Why Referral Software Helps
There are a few concrete benefits to using referral software, including:
- Software increases ROI. Instead of throwing rewards at customers and hoping for a boost to sales, you can almost guarantee a return on your investment thanks to the software’s reliance on tested techniques and structures.
- Software establishes trust. By essentially automating your referral process, neither you nor your customers need to worry about the distribution of rewards. Customers new and old can rely on your referral program, and you and rely on your referral software.
- Software improves other marketing strategies. An effective referral campaign will work alongside other marketing tactics ― particularly social media marketing ― to help your brand go viral.
- Software allows analysis. As mentioned above, most referral software collects copious amounts of data on its own performance, providing insight into what changes can drastically improve the program and further increase your ROI.
Where Referral Software Is Available
Because referral marketing campaigns are complex and tend to be exceedingly personal, few marketing firms offer referral services.
Further, working alongside a custom referral program creator is costly, and few at-home workers and small business owners can afford such an enormous marketing expense. Even if you already partner with a marketing services provider, you likely don’t have access to valuable referral software. Fortunately, most referral software providers operate online, so you can find and evaluate your options from the comfort of your home office.
How to Use Referral Software Effectively
Though you can use your standard marketing channels to improve your referral marketing campaign, referral marketing is a beast of its own. Here are a few tips to help you use your referral software to the best of its ability and see the business success you crave:
- Set a quantifiable goal for your campaign, for example, a 10-percent increase in sales over a six-week period.
- Offer rewards your customers want, which will require some testing before and during your campaign.
- Be polite, and make sure you always thank your customers for the business they send you ― even though their actions are incentivized.