Use Paid Referrals to Generate Buzz

by Emily Retherford

1 min read

Regardless of industry, referrals and reviews are the key to long-term success. It’s critical that the ongoing chatter about your business reflects it in a positive light. You can’t force your customers and clients to refer their friends and family to your business, but you can incentivize them. A paid referral is exactly what the term implies: You pay someone to share your company’s information with someone who might be interested. This doesn’t always mean you’re going to cut a cheque. You can offer discounted products, store credit, gift cards, or free services in exchange for referrals. You can also recruit online affiliate marketers who can seek out people for you in exchange for a percentage of sales. Before offering paid referrals, you need to plan your strategy. For example, does the person referring your business receive compensation when someone signs up for an email list, or does a purchase need to be completed? A company might pay for referrals because the profits outweigh the payouts. This is especially true if you only pay upon completion of a sale. Paying a 5% commission still leaves 95% for your business. Even after accounting for other expenses, you’re still making a substantial profit. Paid referrals have tremendous scalability potential, especially online. Reward your customers, and they will reward you.

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