In this post, I am going to give detail to those strategies.
1. Make it easy for customers to refer. Businesses that are successful at generating more referrals create templates that customers can use. They give the words to say. This really works well with email. You can provide a message that they can easily forward onto their friends and associates.
2. Generate testimonials. This is more of a passive referral, but can be easily mined from customer experiences. Anytime a customer has a positive experience with you, whether it is through a new purchase, a service experience, or a positive claim process, ask for them to provide a testimonial. Surprisingly, this can be hard for a customer, but you can help. Ask them to describe their experience and what they liked, then type it up for them, and ask for their stamp of approval to use.
3. Strategic Partnerships. I touched on this in the first referral post. Find business and associations that you can help and they can help you. In personal lines, credit unions, realtors, mortage brokers, financial planners, boat dealers, motorcycle dealers, etc are perfect partnerships. On the commercial side, join associations that fit niches you write. Offer to promote their business on your website or in other marketing you do. Being a referral giver is often primes the pump to receive referrals.
4. Creative Offers. This can be sticky in the insurance industry due to rebating laws. Most state DOIs have limits on how much you can gift a customer or lead source, and they only allow you to give based on the referral and not whether you sell it. One agency I know did this, and found himself paying for terrible referrals, names on napkins and bogus phone numbers. He cleaned this up by requiring qualified referrals. The customer had to allow him to quote the business before a referral gift was given.
There are more things we can do for referring customers that provide a value. Charity promotions are a great method. For every referral written you give 1% of the premium dollars to charity in the referrers name. You can provide seminars and workshops. In PL, this is easily done for banks, credit unions, and realtors. I have done this one behalf of agents within realty companies, and it has created nice referral streams.
Don’t be afraid to spend money to generate referrals. This should be treated like any marketing effort. If you know the value of a customer, then it is easy to figure out your money limits. For example, if you have 750 customers that generate $100K in revenue, then each customer is worth $133 annually. So you know, that your budget should allow you to spend at max. $133 to acquire 1 customer. Spend less if you, but you know where you can’t go beyond.
5. Local Media Resource. Develop relationships with local journalists at the daily paper, local news, or business papers. Curate insurance news and send their way. Become the spokesman they go to when they have insurance questions. This becomes free promotion, and makes you a trusted source of insurance.
6. Social Media. This is really an extension of the old-school print testimonial. You create online communities where you share experiences and information, allowing people to create reviews on your business. Reviews become the social currency that their friends use to make buying decisions. Don’t look on social media as some high tech foreign concept. It is just a powerful way of generating testimonies and referrals.
I hope you enjoyed this series on referrals. Our email newsletter should hit inboxes within days, detailing next month’s topic, and sharing some referral data that didn’t make it into the posts.
What has beneficial for you in generating referrals? Comment below.