Double Sided Incentive Programs
Referral programs are one of the most effective and commonly talked about ways to generate more business. In a standard referral program, the type that have been around for countless years, you reward someone for sending a potential customer your way. However, thanks to the new wave of social sharing and digital tracking, referral programs have evolved and yours should too.
A double-sided incentive program is a great solution. While it may seem silly and expensive to offer an incentive to a potential customer just for visiting your business, acquiring customers through referrals results in a lower CPA (cost per acquisition) than traditional marketing methods. How you ask? Since there is a higher level of social proof around your product or service, referred customers are likely to stick around longer. Referred customers also have an average of 16% higher lifetime value as compared to non-referred customers.
Referral programs allow our customers to do some of the heaviest lifting for us. Customers want to know that the people they are referring will be taken care of. A double-sided incentive can add a layer of confidence for your referring customer. They feel a sense of ease knowing their referral will receive something beneficial along with a positive experience. This also makes the referring customer look like an even better friend to their audience. The ability to fulfill our customers extrinsic need in life is POWERFUL. We all want to be thought of as a good friend, a helpful person and by giving your customers the ability to “gift” a great experience and a reward we can fulfill that need for them.
The digital wave has helped streamline the referral process. Customers can simply share the offer on their social media channels or submit the referral information. The ability for customers to submit and share referrals makes the process more interactive and enjoyable.
What does a double-sided incentive program look like? Let’s use an auto dealership for our first example.
Most auto dealerships currently offer customers incentives to come in and test drive a vehicle. In doing so, they receive a reward. Additionally, the dealerships often reward individuals who refer their friends and family. Auto dealerships can optimize the double incentive referral program through the following offer:
We can’t thank you enough for your loyalty to our dealership, but we’re going to try! Give your friend $25 for taking a test drive with us and if they end up purchasing, we’ll send you $100!
This marketing offer should be backed by a process in which customers can submit their referrals and/or a way for your customers to share this offer. Additionally, they can need a simple way for interested friends to sign-up via social media.
How about an insurance agency referral program?
We want to meet your friends! Refer a friend and you’ll receive $20 if they receive a qualifying quote from one of our agents Even better, they receive $10!
Now that we know how simple the marketing and program execution can be, the operational aspects of the program need to be addressed. Customers love the idea of a reward, but often become unmotivated when it takes too long to be delivered or never arrives at all. There is nothing worse than a loyal customer sending over a referral and the business failing to send their much deserved reward. The benefits of a Referral Platform are vast. You can track and manage new, pending and successful referrals and insure order and delivery of rewards to recipients. Gone are the days of wondering if the program is working. Now, you have proof!
Ready to start generating more referrals and revenue? Contact us today!