When seeking a new solution for a business need, initial steps often include seeking out the recommendations of colleagues and individuals in the relevant industry. Client referrals can be a powerful method for B2B businesses to convert business prospects into business partners, with the added benefit of current client retention and advocacy. In this second part of our two-part series on referral programs, we delve into the external, client perspective on referral programs in the B2B sphere.
The Science behind Client Referral Programs
For most B2B businesses, referral programs are already a staple of a comprehensive marketing plan. According to a recent Gigaom survey, brands that implement client referral programs gain a competitive advantage, with 43% of those who use referrals acquiring more than 35% of new clients through the program. The most obvious benefits of a well-executed client referral program include higher close ratios, shortened sales cycles, and overall client retention. Certain key elements determine the success of client referrals, however. Here’s a breakdown of the science behind them.
A Targeted Approach
Similar to how traditional marketing and sales plans target specific audience types to draw in the ideal client for the business, client referral programs too must exhibit a targeted approach in determining what type of client the referral program is designed to bring in.
Bonus Tip: Along with identifying the ideal client audience for a referral program, also identify the target current customer or business advocate who might be inclined to offer a positive recommendation on behalf of the business and its solutions.
Client Services as the Initial Touch Point
At the heart of a successful client referral program is the success of the actual business solutions that you are providing your client. Beyond that, a business’s client services team can massage and motivate clients to offer positive recommendations on their behalf, since they are a business’s touch point with the customer.
Bonus Tip: Go beyond just the client services and get sales teams involved with championing the referral program as well. Equipping sales staff with referral program success rates has the added benefit of demonstrating to a prospect just how viable the pitched business solution is.
The Right Kind of Motivation is Key
Ultimately, what will generate client referrals and positive recommendations for a B2B business is the right kind of motivation. As we noted in our last blog on employee referral programs, cash prizes remain popular as incentives – however, creative incentivization such as charity donations or paid time off, also prompts employee referrals. The same principle hold true for client referrals. Know the audience and their needs and wants. Determine referral incentives and rewards accordingly.
Bonus Tip: Sample multiple incentives to determine what the audience likes best. Whether it’s a T-shirt, a cash prize, or a tech gadget – know what gets the target audience, whether current/former clients or simply business advocates, motivated to offer the coveted referral.
Regardless of how stellar a business solution, or how motivated a client or advocate may be, if the process to submit a client referral is cumbersome, the referral will be lost. Implement a user-friendly process that takes advantage of current referral software, such as Influitive, for referral submissions.
Bonus tip: Whichever software or technology is used in implementing the referral program, ensure it integrates with social media easily – this way the client or advocate has the ability to refer the business on their social networks effortlessly. Take it a step further and optimize the referral program for mobile (via smart phone apps), giving clients and advocates the ability to submit a referral instantaneously while also keeping the business at the forefront of their minds thru the app.
Once you’ve secured the client referral, maintain contact and keep the referrer informed about any progress. This is also the chance to say “Thank You” and secure the client or advocate’s recommendation for future referrals. If the referral leads to the closing of any new business, send a reward or gift to demonstrate to the referrer the value of their effort and how appreciative your business is.
Bonus Tip: Use the post-referral communication as a method to garner additional feedback on the referral process as a whole, thus continuously refining your business’s referral program.
Whether it’s an internal employee referral program, or an external client referral program, a B2B business stands to gain tremendously when implementing referrals for the business. With the basic science of the different kinds of referral programs laid out, how likely is your business to implement a referral program?