Providing quality work for customers has been a centuries-old method of keeping in business. "Word of mouth" is a marketing concept that most companies rely on. However, in this era of fast paces, advanced technology and saturated markets, the "word of mouth" concept gets lost in the shuffle. A new customer can receive company information from an endless supply of resources.
How can a customer service oriented company increase the number of referrals$%:
According to Joy Gendusa, founder of PostcardMania, you have to reward your current and previous customers. "The reason that happy customers don't tell many other people about your service is because most customers EXPECT good customer service so the companies that provide it aren't at the front of their mind. They have too many other things to worry about on a daily basis," Gendusa says. "By starting a Customer Referral Program, you will give your best customers a reason to want to tell other people about you."
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What rewards do other companies offer$%:
According to Gendusa, when you set up your own referral program, you need to make sure that the incentive you offer your customers is in proportion to the price of what you are selling.
For example, in 2000, when new members joined Pay Pal, the online payment service company added $10 to their account and credited an additional $10 for each new member referred, up to $1,000. Similarly, the communications company InfoHighway, rewards customers for each referral with a one-time payment of up to $200 in bill credit or a $100 American Express Gift Certificate. Windows Plus, LLC, pays $100 to their customers for every referral that results in a signed contract.
Referral programs work
As cited in the June 2005 edition of Inside Flyer, 82 percent of Americans participating in customer loyalty programs have actively referred friends and family to their favorite loyalty programs, according to Parago's 2004/2005 Customer Loyalty Research Report.
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