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We are thinking of offering a referral programme to our clients. Seen this work anywhere else?

Nov 23, 2018

Referral programme

Several accountants have asked me about referral programmes lately. One client in Canada said, “We are thinking of offering a referral program to our customers… something like 10% of new sign-ups monthly fee as a discount for 12 months. What do you think? Seen this work anywhere else?”

In our experience paying people for referrals doesn’t really work. If you want to send a gift to people to thank them for referrals, that’s great – I’ll talk about that further on. But setting up a scheme of some kind is not the best marketing you can do, and here’s why.

Referral programmes are based on an outdated type of marketing.

They’re based on the concept that people refer in simply one way. They send a link, or tell someone about you, the person gets in touch, they sign up, job done.

That’s not how marketing works anymore. Remember the progression model –  the buyer goes through a long process of becoming aware of you in a variety of ways, and neither the buyer nor you know exactly what it was that tipped the scales.

What if the person refers, but they forget their link, or the person forgets to say who recommended them? That causes frustration more than anything else.

It actually makes it harder, not easier, for people to refer to you.

People are going to tell others about your accountancy firm in casual comments, on social, in an email, in a text message – a thousand different ways.

If they have to scrounge around on their phone desperately trying to find the special link, or the code, or the website page, they’re either going to give up and not bother – or else they’ll simply say “well it’s this firm, go talk to them”.

The referral alone doesn’t get you the business.

A good referral helps a lot – it can even help mitigate the situation if your brand or website are terrible – but it’s not the only thing that gets the new prospect to become a client.

Hinge Marketing produced a report which indicated that 46% of people who had been referred to an accountancy firm never actually got in touch with the firm. The firm was recommended. Someone said they were great, told them to go check them out. The person checked them out on their website and…never did anything.

Maybe the website wasn’t great. Maybe the brand didn’t impress, or the words sounded like every other firm. Maybe a lot of things: but that’s nearly  half of the people who have been referred to you….doing nothing.

Referrals are good: but you need a good clean brand, a solid website that reflects your brand and its messaging, and great content based on the questions and issues your ideal client has.

People love to refer a business or establishment that is good. They do it because they want others to have a great experience.

You’ve heard that if someone has a bad experience, they’ll tell ten people; if they have a good experience, they’ll tell one person.

This is because when we have a bad experience with a company, we want to make sure that no one has to go through what we went through. It’s why people complain on Twitter, or share horror stories by video, or simply tell a tale at the pub. Whatever happened made our life really difficult for a short or long period of time, and we don’t want that to happen to someone we care about.

It may sound simplistic to say people want to refer purely out of the goodness of their hearts, but in this case I’ve found it to be true more often than not. Think about the last restaurant you absolutely loved. An example for me is the Educated Flea in Edinburgh. I had an incredible experience there (the people and the food), and if someone is coming to the city and wants a good food experience, I want to make sure they don’t waste their time with places that are promoted highly but aren’t that great.

It’s why TripAdvisor is so popular. James Ashford and Will Farnell and I were in San Francisco earlier in the month, and we were looking for a place for breakfast. I pulled up TripAdvisor on my phone, and we found a place that did crepes and waffles and all sorts of good American breakfast food, and it was indeed good. It was taking a few minutes to connect on my phone, so Will suggested we could just pick a place and go there, but James reminded him that it’s 2018, and you don’t just walk into a place and risk a complete fail. (When you do, though, it can make for a great story later!!)

The person who gets the referral wants to know it’s genuine.

I’ve had countless companies suggest that PF join a referral partner plan so we can get credit of some kind when we recommend them …but every time I go back and say we don’t do things that way.

If their product is amazing, and our accountant clients tell us about it, we’ll recommend it highly. If we like the idea and we like the people who work for the company, we’ll mention it, but leave it to the accountant to make up their own mind.

But we won’t take discounts or referral fees for doing so, because we want people to know that when we recommend someone, it’s because they’re good.

If they stop being good, we’ll stop recommending them.

Sometimes when we have a great relationship with a company, we’ll ask them to create an offer which will save our clients money, or we’ll pass the discount directly on to our clients. That way our clients know we only refer because the company is excellent, and no other reason.

Whatever your programme is, you’re essentially paying people for referrals – and the very best referrers don’t care much about that.

Okay…so what do we do? How do we thank our referrers and get more referrals?

What works best is simply thanking and rewarding people personally as the referrals come in. You want people referring because you are awesome, not because they get something – and then the getting something is an amazing reward they didn’t expect.

It also shows you care about them personally, rather than a generic gift or money. Most people who truly refer would almost be offended at the thought of doing it for money.

The typical referral gift is a bottle of wine, chocolate, a gift certificate to a restaurant, or a spa day. What if the person hates wine? Doesn’t drink? Lives far away from typical restaurants? Hates chocolate?

For example, I don’t like milk or white chocolate. I only like dark chocolate, and in small amounts. I am not a big fan of wine. But I do love whisky, and Harry Potter, and reading, and coffee. I’ve been sent some really lovely gifts by people who know me – and it’s not about the gift amount. One client sent me a handmade magical wand with my name on it – they knew someone who did that sort of thing, and got one handmade for me personally. I still have the wand on my desk and I think of them all the time.

Another company sent me a thank you box including a bottle of my all time favourite whisky (Auchentoshan), two custom whisky glasses, and branded PF swag. They knew me well!

So keep it personal. Think of something really useful or what the referrer would love – and every time you get a referral, send a real thank you to them.

How do we encourage people to give us more referrals?

1. Ask clients if they have ever referred you before.

When you talk to existing clients, ask them if they’ve ever referred you or mentioned you to anyone. If they say yes, thank them and ask what it was that brought it up in conversation, or what they love about you.

If they say no, ask if there’s any reason they wouldn’t if it came up.

2. Ask specifically for referrals to a niche – such as creative agencies, or dentists, or an area you’re experienced in.

If you say “Do you know anyone who needs a good accountant?”, they might instantly say no, because they haven’t spoken to anyone recently. But if you say, “By the way, do you know any digital creative agencies in this city who are struggling with their bookkeeping too?”, they’re far more likely to either think of someone straight away, or at least remember the conversation when it comes up later.

3. Document any referrals you do get.

Most times people refer in a very casual way – in a conversation, in one of many different communication methods! I’ve found myself asking, “Wait did I message them on Twitter? LinkedIn? No wait maybe whatsapp. Or email? Which email address?”

However someone refers to you, make a note of it yourself. Have a system so you know that they referred, and when the person does become a client, you’ll know who to thank.

4. Do crazy cool things.

Xerocon had a zip line at their event in London this year. And swings, and real grass for an indoor park, and beanbags. Xerocon always does a great job of impressing people with their events, and that’s because they do things people remember, enjoy, laugh about, share.

What can you do that will stick in people’s minds? That they can take a picture of, and appreciate, and enjoy?

It doesn’t have to be a zip line. But as an accountancy firm, you have an amazing opportunity to stand out, because people still have this perception of accountants as if they are boring. You and I both know you’re not boring, but how do you show that? What can you do that is really cool, even if it’s small?

When I was a wedding photographer, there was a company from which I would order a very expensive camera lens from time to time. Usually the lens was somewhere in the range of £1k – £7k, so it was a big investment and I was really excited when it arrived. But every time you ordered anything from this company – whether an expensive lens or an SD card – they included little packets of Haribo sweets. I kid you not, every time, I would open that amazing box with its beautiful new expensive lens and go “ooooh, sweets!!”.

Whatever you do, BE CONSISTENT. You need people to be able to rely on the sweets, the gift, the fun thing. That’s what helps keep you top of mind.

5. Care about your clients as humans.

Yes, you need to do great work. You also need to stay connected to your clients as human beings. Send them a text message now and then. Remember birthdays or anniversaries or weddings. Notice what they talk about on social and bring it up the next time you see them.

This will help you know what kind of personal gifts to send, too.

6. Continually ask for feedback.

At the end of the day no referral programme, thank you gift, cool thing, or website will ever make up for bad service.

If you don’t do what you promised, or the referred person has a bad client experience, it doesn’t matter what you do to thank the referrer. They’re going to be hesitant next time.

Do great work, and ask for feedback on a regular basis – in a variety of ways. You can send a survey if you want, but in our experience that is much less effective than a personal phone call or text or email. “How’s it going?” “Everything go okay with your bookkeeping this month?” “Did we hit our promised deadlines this quarter for you?”

And if the answer is no, or things aren’t right, you have the opportunity to fix it, fast. Before it becomes a recurring problem.

Do great work, and keep doing it.