Customer referrals are indispensable if you want to grow your customer base organically. A referral program incentivizes your customers to share your product or service with their family or friends.

Here’s what you need to know to create a small business customer referral program that works for you.

How to Set Up a Referral Program

Referral programs for small businesses are great for keeping your sales pipeline full without additional work for your sales team. A great one will encourage your customers to recommend your company in exchange for something they want.

It’s a win-win for everyone involved, but you must be strategic in your setup to maximize results. Here’s how to create a small business customer referral program
that your customers will love.

First, clean house. With a small business referral program, you ask your customers to risk their credibility to vouch for your product or service. You owe it to them to troubleshoot every aspect of your offerings to ensure they won’t disappoint. This includes providing fantastic customer service.

Next, brainstorm incentives. What will you offer your customers when they successfully refer someone to your business? Consider the demographic of your ideal client and what types of rewards would motivate them.

Common incentives include discounts, extra subscription time, or free products. Customers could also amass points to redeem for a selection of rewards. Offering a discount on a future purchase encourages repeat business, while a tiered system rewards customer loyalty over time.

Finally, pick a platform. Many apps, add-ons, and plugins will handle the bulk of your customer referral program for you. If your website uses Shopify or a similar website builder, search “referrals” in the corresponding app store and browse the results. If not, you’ll need to find a referral-tracking method compatible with your website.

It’s okay if your website is a little more low-tech. If needed, you can manually track referrals with a spreadsheet. Just know this will become more difficult to manage as the program grows.

Once you’ve developed your referral program, you must inform your customers. Create a landing page explaining the program in simple, concise language. Make it easy for your customers to sign up and start earning rewards. Then, announce the program across all of your marketing and communication channels.

Overall, small business referral programs benefit both the company and its customers. However, customers will likely forget about the referral program if it isn’t top of mind. Please send email reminders to alert new customers and remind previous customers about this opportunity to be rewarded for their recommendations.

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Coach Dave