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Understanding the Power of Referrals
If more businesses considered referrals in marketing and customer service, they would be more successful. Here is one area where businesses and individuals should be concerned about what other people think of them. It is a popularity contest. The winners reap the rewards. Following are a few areas that need to be looked at as though referrals are the most important aspect. Four simple concepts to remember:
1. Ads should be placed where people will want to look at them. People remember what they see when it relates to something relevant to their needs. People talk only about what they remember.
2. Informative content is more important than flashiness. People like to be informed and they like to share the information they receive with others.
3. Customers should always feel as though they are the most important factor in the transaction, even more important than your product or service. Making people feel important increases your chances of getting a positive referral.
4. Referrals should be used as incentives and incentives as referrals. If you tell a person they will receive a good deal on something they already want just for telling others about your product, they will be motivated to spread the word. Most of us have seen a sign in a restaurant or brick and mortar store saying, "If you have a complaint, please tell us. If you have a compliment, please tell everyone you know." Businesses know that people will complain or praise their service based on their experiences with them. Of course they would rather all complaints be made to them directly, but they are wise enough to know that the experience will be shared whether positive or negative. Referrals should be the motivation behind every interaction with potential customers. Placement is very important. Referrals don't just have to be positive, they need to be appropriate. Putting your advertising in relevant businesses that fall in line with your customer's needs is highly effective. For example, it is smarter to place a banner ad on a real estate site if you are in the moving business than to place a banner ad for moving on a site selling dolls. In the first example, you are addressing a need the customer will more than likely have. In the second, your ad will either be annoying or forgettable. Neither adjective is one that promotes sales. A customer will not refer to something they don't remember or if they are annoyed, that is the experience to which they will refer.
Word of mouthadvertising is more effective than flashy signs, full page ads or creative commercials. A flashy sign catches the attention. We remember the color and maybe even the name, but a flashy sign tells us nothing about the product (unless, of course, the product is the sign itself). Full page ads, if done right will catch our attention during our perusal of a magazine or website, but unless the ad has redeemable value such as valuable information and entertainment, we are more apt to be irritated than intrigued. Creative commercials make us laugh, cry, yell.... All of these are good responses because an emotional reaction "sets" a memory in our minds. There are a lot of commercials I like on television. I remember the details of the commercial right down to the incredulous look on the young man's face.... but "Hmmm. What was that commercial for anyway? Oh yeah. That soda! What is that called again?" More information, please.
If someone we trust tells us about the experience they had with a specific company's product and/or service, we remember their accounting when a need arises that might be filled by that company. "Well, I'll tell you who won't be getting my business. Those people really screwed up Meri's order. They were rude when she tried to resolve the matter, then they refused to refund her money. I don't care if they have a cute billboard. They aren't getting my business."
or:
"You know, this company really helped my sister when she was in a hard place. She said they are fast, friendly, and they gave her a great deal. Let's see if they can help us." Keep customer service in mind from start to finish - from advertising placement to the close of the sale. Every potential customer is a potential referral. If a business is customer oriented, even if a buyer does not choose your service, they will remember you to someone else who may be a better fit. Even when you receive a complaint, you have the opportunity to turn a dissatisfied customer into a satisfied one. How you respond to dissatisfaction can make a difference in how customers tell others about your company. Incentives through referrals are tremendously effective as well. If someone knows that clicking on a specific link from a specific site will get them a better deal, they will most likely click on that link. It is that link they will point to when asked for advice from business associates and friends, especially if the incentive is tied up in referrals. Who won't refer a friend if it gets them a better deal? That is an incentive not only for your business to place coupon codes on relevant sites, but a great reason for those link partners to allow you to advertise with them. It is a win-win situation for everyone. Keep these ideas as guidelines for doing business and you will be rewarded not only with more customers, but with more returning customers. Referrals should be foremost in your mind through every step from advertising to delivery. Only you control what others see and hear when they deal with your business. Make it count.
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Contributor's Note
This article was authored by Karla Whitmore. Original posting at: http://www.helium.com/items/1041322-understanding-the-power-of-referrals
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Other Articles by K Whitmore on Helium.Com
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Well over half my customers come from referrals. A well done wood floor helps too.
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