Three Ways to Get Word-of-Mouth Referrals for Your Small Business

by Thom Tracy

2 min read

Word-of-mouth referrals can be hugely beneficial for any small business or independent contractor or professional offering products or services. While regular, paid marketing and advertising campaigns are a must for nearly any business, the importance of generating new business through free or low cost word-of-mouth referrals from existing customers should not be overlooked. Referral marketing is one of the most cost-efficient means of growing your business and increasing revenue. A survey conducted by Huzzah Media, a business solutions firm, found that 80 percent of small businesses depend on word-of-mouth referrals and repeat customers as their primary sources of revenue. Having an organized system in place to generate referral business simply makes good business sense.

Using Social Media

Small business owners, or independent professionals such as accountants, who can master using social media to spread the word about their business have a definite edge in marketing. You don’t have to become a social media expert in order to effectively utilize tools like Facebook, Twitter or a blog. Effective word-of-mouth advertising online can be as simple as regularly posting updates about your business on social media channels.

Build relationships by giving potential new customers helpful advice. For example, an accountant might tweet or post to Facebook a link to an article on tax deductions. Retailers can post notices about sales or special events at their store, encouraging online friends to spread the word to their own friends.

A personal or company blog helps to create a brand identity for your business. Writing just one or two short blog posts per week can substantially raise the marketplace profile of your business.

Offering Incentives to Existing Customers

One of the easiest ways to increase word-of-mouth referrals is to offer existing customers incentives such as free or discounted products or services as a reward for referring new customers. Providing these incentives can encourage existing customers to spread the word to their friends about your business. If this creates a new customer who represents repeat business for you, it will be worth the minor expense of giving an existing customer a free product or discounted service. Establishing a customer rewards program for referrals can be one of the best ways of building your business through referrals.

Focusing on Customer Service

Loyal customers are most commonly created through superior customer service. There are two key ways of providing the kind of customer service that not only increases the loyalty of existing customers, but also makes them more likely to recommend your business to friends. First, seek out customer feedback on how you can better serve your customers. Second, responding promptly to this feedback lets your customers know that you are listening to them and are doing your best to provide them with what they want or need. These practices generate positive experiences for your customers that make them more likely to continue doing business with you. Even better, it also makes them more likely to mention their positive experience with your business to other potential customers.

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