B2B referral marketing is a simple concept, but it’s not easy to do.
If your organization doesn’t have a formal referral marketing program, it’s missing out on one of the best and most trusted marketing approaches to revenue growth.
Suppose a customer shares their experience with your organization with others. In that case, they’re motivated by their good word’s positive effect on their social status by sharing a solid recommendation with their peers. Referrals resonate with buyers because they are hearing from someone they trust.
The numbers support B2B referral marketing with higher conversation rates, shorter sales cycles, and higher margins.
The Power of B2B referral Marketing can be summarized in the following points.
1. Customers are just one source of referrals.
Existing customers are an essential source of referrals but don’t overlook the influence of peers, vendor partners, bankers, accountants, lawyers, and consultants. There are many individuals and organizations that potential customers trust, so tap into them as well.
2. Customers that provide referrals have a higher retention rate.
Customers who participate in referral programs are more loyal because they have a high level of satisfaction with your organization. Asking for a customer referral is an ideal method to pressure test the strength of a customer relationship.
3. B2B Marketing referral program ROI is high.
Measuring ROI can be elusive for some marketing initiatives. On the other hand, referral marketing is often self-funding, and ROI is more straightforward to track than traditional marketing efforts.
In the past, referral marketing relied primarily on verbal customer outreach, which continues to be a significant source of referrals. For complex B2B sales, we’ve seen the outreach approach deliver a large portion of referral program results.
Modern referral marketing programs leverage social media, email marketing, incentives, and automation tools to increase the scope to reach a broader audience.
4. Sales Enablement is essential for referral program success.
Salespeople have strong relationships with customers, so planning and executing referral conversations is crucial to sourcing referrals. The simple motion of asking an existing customer for a referral can be daunting for fear that the customer may say no.
Before embarking on broad or automated referral program efforts, we recommend starting with the one-to-one interactions between salespeople and their customers. Scripting, practice, and role-plays are ways to help salespeople prepare for customer referral conversations.
B2B marketers continue to evolve and experiment with new initiatives. The power of B2B referral marketing is leveraging your most valuable resources – your customers, peers, and partners – to help communicate the value of your solutions.
If your organization doesn’t currently have a referral program in place, it may be time to develop one of the most potent B2B marketing leads sources.