Using Customer Referrals to Grow Your Business

Building a customer base for your small business is very difficult. Gathering new clients is very difficult to do no matter what kinds of methods are employed. One method can be an array of different marketing techniques. Potential client cold calling would be another one. You can even use direct mailings to potential client’s homes. Yet there is an untapped resource for many businesses. Failing to take advantage of current client referrals is a huge mistake often made.

The back bone of your business development plan can be customer referrals if you use them in the right way. Current customers who are pleased with your business can be your best form of advertising. Finding a way to generate referrals out of your customer base can allow you to grow your new customer base drastically more than you have in the past. It is difficult to figure out a way for you to generate these referrals in an efficient method.

You can efficiently generate current customer referrals in a few different ways if you think of them. If a current customer of yours refers a new customer, you can offer a bonus or special offer to them as a reward. The perk can be given to the referrer and the referred. A $10 bonus can be offered to the new customer that you acquired and then you can turn around and give the same thing to your current client. This method invokes some added costs, which is really the only draw back.

The normal cost of a new customer is something you must weight though. This new customer cost you how much time to gather? How much money to you spend on the marketing developed? Spending time and developing marketing both end up costing you some money. Often times this money will add up to be equal or greater than that of offering a referral bonus. Making the current customer you have happy is one of the benefits you get from referral bonuses, not only a happy new customer for you.

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