According to the Wharton School of Business, a referred customer costs a lot less to acquire and has a higher potential for retention and loyalty. In fact, a referred customer has a 16% higher lifetime value than a non-referred customer.
But how do you go about breaking the ice with your customers to ask them for help? How do you encourage them to mine their network to help you without being pushy or awkward? Here’s how to make the ask, whether you’re in sales, customer service, or just looking to grow your company.
1. Build Value First
You can certainly ask for customer referrals immediately after closing the deal—but we wouldn’t recommend it. Wait until you’ve provided your customers with unparalleled service. They’ll be more likely to share names of trusted colleagues once they know you haven’t just been trying to get them to sign—the value you’ve proven will make them want to tell their network about you.
Share relevant content with them and let them know when your company releases new products or features that would benefit them. Three to six months after their initial purchase, consider asking for referrals—but only if you’ve delighted them thus far.
2. Ask, “Who Do You Like?”
Ask your customers, “Who do you like?” to ensure you get referred to people customers have close working relationships with. When you receive referrals of people your customers have, at best, passing or lukewarm relationships with, they’re not much better than cold calls. Ask for people they like, and you’ll benefit from the closeness and trust that relationship already has.
3. Offer Incentives
Offer Amazon gift cards, a discount on next month’s invoice, or a donation to the charity of their choice for sending in a referral. Send this incentive offer to a portion of your happiest customers, and tell them the first 10 to respond with a referral will receive the prize. You might be surprised at how fast those referrals suddenly come to your customers’ minds.
4. Return the Favor
If you want to get referrals, you should also give referrals. This is what I call a “referral mindset.” Help your contacts and acquaintances grow their businesses by hooking them up with people in your network, and they’ll feel inclined to return the favor.
5. Send an Email
When requesting a referral, you want to keep the focus on your customer and their happiness. You don’t want to appear like a lead-hungry sales rep who’s done with them and ready to move on to their friends.
Here’s an example:
Hello [Customer Name],
I’m so glad to hear you’re happy with the results of working with [Your Company Name] so far. I knew we could help, and I’m pleased you’re seeing results so quickly.
Since things are going to well, I found myself wondering if you have any colleagues at similar companies who would benefit from our [product/service]. I would love to help them achieve similar growth.
If you have a favorable response to the email above, reply with, Great, I have an easy email template I’ll share with you. All you have to do is press send! Provide them with the email template below, and you’ll make it simple for customers to refer you:
I don’t know if I’ve mentioned it before, but I’ve been working with [Your Name] for a few months. The other day, I was talking with her about some of the things she and I have done, and I realized I should connect you two together.
[Referral’s Name], meet [Your Name, with your LinkedIn profile URL and little bit about you].
[Your Name], meet [Referral’s Name, with their LinkedIn profile URL and a little bit about them].
I’ll let you two take it from here!
From there, you can take it away or connect them with a salesperson at your company.
Don’t wait around for referrals to start trickling in—formalize your process and launch it today.
This article was originally published on Hubspot. It has been republished here with permission.