5 reasons why paying for referrals can have both positive and negative repercussions
Paying customers for referrals is always a topic of discussion among roofers.
Some feel it is okay to incentivize their customers to refer them to their friends and family, and others feel it’s a tad disingenuous, that you’re coaxing customers into giving you leads instead of letting them do so on their own volition.
Before we get into this article, leave a comment below telling us why you are for or against customer referral programs.
Now, here’s 5 reasons why customer referral programs can have both positive and negative repercussions.
1. Expectation to pay for new business
As a business owner, you can’t expect new jobs to fall into your lap. You have to put time and money into creating opportunities. Dmitry estimates that every contract he signs is a result of roughly $200 worth of advertising/marketing investments. Think of the wrap on your car or the sign on a lawn. Those things aren’t free, but they’re great ways to generate business.
2. Referrals are not for everyone
Even though your company may offer incentives to customers who refer you, it doesn’t mean every customer wants to take advantage. Be mindful of a customer’s preferences, and don’t go too far in mentioning how great your incentives can be.
3. Don’t NOT offer something
At the same time, don’t leave customers hanging. If someone wants to endorse you to their friend or neighbor, by all means, let them, and then make it worth their while. Everyone likes to feel appreciated, and rewarding customers who refer your company is a great way to build relationships.
4. People expect something in return
When a customer refers you, that doesn’t mean you have to buy them a new car. It simply means that you have to show them your appreciation. Even something as small as flowers for women, or steaks for men, goes a long way toward cementing a lifelong customer.
5. Rename your program
Be creative with your reward program. Don’t make it too stuffy or technical. Make it so that customers want to partake. And then be grateful for whatever leads or referrals you get. Being grateful makes the person giving you help feel good about themselves. And lastly, don’t recruit homeowners to sell for you. Your reward program is not a call for help.
Thank you for reading about customer referral programs.
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