, In my last article \"5 Web Features That Every Business Should Utilize\" I spoke a little bit about the benefits of referral programs. In this article which is Part 2 of 6 we will get more in depth about these benefits. First, lets review what we learned about referral programs in our last article. Referral Programs are:
An excellent way to obtain new customers or clients
A way to give back to current customers and a way to gain new projects
A good way to add to your sales efforts without having to hire an employee
Now lets take a better look at each individual point in its own rights and how it interacts with the other points.
Obtaining New Customers and Clients
Obviously obtaining new customers or clients is the main intent of anyone who is going to implement a referral program. The purpose of these programs is to get semi-warm sales leads. In it\'s most basic function the program works as follows:
1. You budget in a certain amount of funds, made available to the public by way of application and approval, to refer your services to people.
2. In return, individuals may apply to join the program and begin to refer others that they know who are in need of said services.
3. For every referral they send, that turns into a project or sale, pay the referrer a percentage of the sale.
The cliché it takes money to earn money is the idea here; but then again, the money you make will be a Cox Online Backup profit off of what the referrer makes you.
(*a mutual trust is required between the referrer and your business [and an agreement]*)
Giving Back To Customers and Clients
One of Cox Online Backup the most rewarding things you can do is give back to those who have helped you along the way. Besides just gaining sale leads you can choose to \"give back some\" by offering a better version of your referral program to your current customers or clients. Offer your existing clients a discount or a percentage when they refer a customer. I personally offer a program for both my current customers and a standard program available to anyone. This way is beneficial to both you and your clients or customers. Cox Online Backup Let\'s say you offer something such as business services. And let\'s say that in your referral program you give 25% of a sale to a current customer and 15% any referrer. Well if an average customer\'s total services rendered are $1000, your referrers stand to make a decent profit per referral simply by passing on word of mouth. It can be like hiring another sales team, if its done right, which brings me the next point...
Increasing Your Sales Team without Increasing Your Employees
What can I say, this a really excellent way to add to your sales efforts without having to hire any employees. To make a referral program succeed in this manner; it must be done in a way where the referrer stands to make a good profit from nothing. Take my referral program as an example. I pay all of my referrers a 10% referral fee on all referred client billings up to $4999.99. But if you\'re an existing BSA customer or client and your referred client payments reach $5,000, your referral fee percentage increases to 15%, where it remains indefinitely.
I.e. refer a new client with services costing $1000 - You pay $100
I.e. refer a new client with services costing $3500 - You pay $350
I.e. refer a new client with services costing $5000- You pay $750
I.e. refer a new client with services costing $10000 - You pay $1,500.
Next Article ... Awards Programs... February 2006
Joshua M Cox, Owner and Creative Director for Business Solutions of America, has been active in the design field for over 5 years. With a background in design and business he worked his way up through the industry freelancing before launching BSA in 2001.
In addition to his own personal experience, Mr. Cox is privileged to work with an exceptional network of talented industry professionals on a project basis in the areas of photography, illustration, website coding, and multimedia development.
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