Referrals are the best type of new customers. Every study I’ve ever read says they are worth more, easier to sell, have a higher lifetime value and make the person who referred them more loyal. Most businesses (often incorrectly) use incentives (e.g. free services, $25 gift cards, etc.) to get new referrals.
But, what happens if your industry won’t let you use an incentive to get more referrals? How do you entice people to talk about you and share your services without risking losing your license or business or even getting jail time in some cases?
The good news is, all is not lost. The even better news is, once done correctly, you can actually end up getting referrals for less per new customer then some of the best incentive programs. The bad news is, this isn’t easy. Sorry.
The first place to start is with information. I don’t know of a single industry that can’t give out information as a lead magnet to get a referral. Here is how this works. Let’s assume you’re a physical therapist and you accept Medicare, which basically means you have limited options for gifts for new referrals. You can hold seminars (which is a great idea and totally works) or you could offer an incentive in the form of information, for example, “7 Home Remedies to Relieve Lower Back Pain.” This could be a DVD, online video series or eight-page workbook.
This “free information” tactic is also an excellent approach for lawyers, who deal with heavy-handed restrictions on their marketing campaigns. I work with several who offer information on what to do after being injured in a car…
