Market research is all about getting to know the audience for a service or the potential market for a new product. That means gathering data. Often, the data you gather can tell you a lot about customer habits, and for small businesses, that helps inform a vital part of their marketing strategy.
Market researchers know that data allows businesses to make predictions about future behaviour; that’s why so many stores have loyalty schemes. But if your business isn’t profitable enough to offer continual discounts, there’s another way to market yourself and find out what customers like: the referral scheme.
In this article, we’ll look at ways to create your own referral scheme and the potential benefits of doing so from a market research perspective. We’ll also find out how to weave market research work into the humble referral.
Setting Up a Referral Scheme
Many businesses use manual or word of mouth referrals, and there’s nothing wrong with that providing you have the time to keep on top of the referrals you’re receiving. Automation is normally preferable if you’re stuck for time.
Assuming your site is built on WordPress (more than half of blogs whose CMS is known are built using WordPress), you have a number of options. Free WordPress referral plugins are not easy to find, but premium (paid) plugins are plentiful:
- WP-Referral allows unlimited referrals and affiliates plus stats about each user.
- WordPress Referral gives you some attractive visual reports on how your referral scheme is going.
- Affiliates Pro offers full ecommerce integration.
We think WordPress Referral strikes a nice balance between simplicity and rich features, but Affiliates Pro is the plugin to choose if you’re serious about generating masses of new business. Make sure your referral plugin captures extra information such as reasons for the referral, testimonials, comments and star ratings.
Creating Attractive Terms
Your referral scheme needs to strike a fine balance: it must attract new business, inspire your referrers and generate profit for your business. You might want to give the referrer some kind of kickback once they refer a customer who spends a certain amount of money.
Don’t give away too much to the referrer. Remember that you still have to pay yourself a salary. Nobody expects you to compete with huge affiliate marketing schemes, simple is better according to the affiliate programs service https://insurancerevenue.com/.
- Rather than paying cash, think about issuing coupons or discounts off invoices.
- Aim to cut your marketing spend in line with the referral credits you give out.
- Glean as much data from your referrers and referees as possible to enhance market research data.
- Think about cascading referrals in exchange for testimonials and feedback from your newest customers.
Do Referrals Work?
Referrals are a great way of generating new business, since the people who refer new clients can give an honest recommendation based on their experience of the work you do.
But referrals work best when you use the process as a chance to see why you’re being recommended. It’s great for research and it helps you to understand where you could improve.
About the Author: Sam Wright is an avid researcher and is writing on behalf of Brand Republic.
Photo credit: Ian-Bogdan Dumitrescu
