Generating leads that create a loyal customer can be time-consuming and overwhelming. You might be asking yourself, "Where do I start?" or "How do I even get leads for my business?" And that's okay—all business owners ask themselves those same questions at some point in their careers. And we have an answer to help solve this problem—two words: referral marketing.
Referral marketing is the process of using your existing, happy customer base to find new potential customers. It creates a more compelling online word-of-mouth that benefits both your business and your customers.
And your customers want to refer people to you—when they're asked. For example, a Texas Tech University study found that 83 percent of customers say they're willing to provide referrals after a positive brand experience, but only 29 percent do.
There are so many benefits of using referral marketing for your business. Not only do your customers want to refer people to you, but they're also more than likely already talking highly of you to others. Eighty-two percent of Americans seek recommendations from friends and family when considering a purchase, meaning your happy and loyal customers could be talking about your business without you knowing.
Referred customers are also more likely to close faster, buy more, and stay longer than those who weren't referred. This was proven in a study by the University of Pennsylvania, which found that referred customers are more loyal and profitable. Referral marketing also creates a cycle of loyal customers. By getting a referral from a happy and loyal customer, you gain another happy and loyal customer, who then provides you with another lead, and the cycle goes on and on.
While referral marketing is not new by any standards, it's vastly under-utilized by many businesses. You have a fantastic source of untapped selling possibilities in your existing customer base. Try creating a referral program today, and see how it helps your business grow!
Dani James is a Marketing Specialist and writer for Atwill Media. She has a bachelor's degree in Strategic Communications from Arkansas State University with focuses in Public Relations, Advertising, and Social Media Management.
When not working, she enjoys spending time with her family, reading a good book, and watching The Office.