When you’re a new business in town, and you offer great service or a great product, you are the hype of that town. People are talking about your business with their friends and family. That is a great time to start generating new customers through a referral program. Your first customers will be excited to share your business with their friends and family. From that point on, you can start building a relationship with your clients which will create a network for your referral program.

When looking to generate referrals, it’s ok to let your customers know how referrals are your only chance at new business. Subtly nudge your clients to generate referrals. Instead of asking directly for new clients from your existing clients, try to form a stronger relationship with them by asking for advice. Focus on new customers, or the top 20% of your customers who love your product or service, and avoid bad ones. Avoid asking customers who were unhappy with your service or product. Ask your customers about people with whom they have great relationships and ask them if they’d mind introducing your company to them. 

Draw out a complete look and feel for the client. That way, you can help make it easier for your existing client to refer the best people to you. Reward your referrers with a token of appreciation, and even reward your new clients. That will bring you even more referrals.

What Are 4 Types of Referrals?

When you’re ready to begin bringing in more customers, know that there are four types of referrals your business can work with. They include:

  • Direct Referrals
  • Implied Referrals
  • Tangible Referrals
  • Community Referrals

Direct referrals are pretty straight forward. You directly let a client know that they will receive perks if they refer their friends and family. Some cellphone apps, for example, offer some money to both the referrer and the new client for registering. 

Implied referrals are referrals which showcase your product or service to the local area indirectly. If your employees have your business logo on the side of their truck, that would be an example of possible implied referrals.

Tangible referrals can be run as a campaign every quarter. It puts something in the hands of people, such as a voucher to share with a friend for some money off their next purchase.

Community referrals are another great way to gain more traffic into your store or for your service. You can partner up with a non-profit organization and let customers know that a certain percentage of your sales are going to the selected non-profit. This will lead to more people talking about your business because the non-profit members will be spreading the word about it as well.

How Do Referrals Help Your Business?

One of the ways referrals help your business is by saving you from sales expenses. You won’t have to spend all your time cold calling with a leads list. The difference between a leads list and referrals is that a leads list is only a list of names and numbers. These people have never even heard of your company. When someone refers to your business, however, your business has already been given an introduction. When the new client visits your store, they will already know about it. That’s the difference between a leads list and referrals. 

Another way they help your business is by improving loyalty to your brand. When the top 20% of your satisfied clients are receiving tangible referral vouchers, for example, and sharing them with friends or family, your business is attracting a similar kind of new customer. Lastly, online reviews are the most modern type of referral programs. These reviews help your business have exposure and they also help customers make decisions on purchasing a product or service. 

How Can I Attract Referrals?

Offering great customer service is one of the best ways to attract referrals and more business to you. If you can give customers a hard-to-forget experience that has them coming back for more, if you can go above and beyond, then it’s appropriate to ask them for a review after they receive their shipment. If they complete it, then, the next step is introducing them to your referral program. Asking an unhappy customer for a referral is a bad idea, because they most likely won’t give you one. Remember, positive customers lead to positive referrals. 


Having a referral rewards program helps people keep track of their rewards every time they refer a friend or family member and attracts more referrals. It’s important to have a community of followers to generate new referrals from. Consider the four types of referrals you can use and go from there.

How Do You Ask for A Referral in Sales?

Ultimately, there are a few things a salesperson can do to land a new referral. Please keep in mind the following when selecting clients for referrals:

  • How long you have been in a relationship with the client.
  • How frequently do you communicate with him/her.
  • Their overall satisfaction with your product or service.

If you’ve been in a long relationship with the client and have good communication with him or her, then you can focus on timing. After your customer has just received their product or service with satisfaction, you can take a moment to suggest your referral program to them.

Learn more about this topic in a real time conversation with an expert. Select a time below.

One of the ways you can introduce your referral program to this customer is to ask for help, such as, “I really would appreciate help from you…” Most people are very happy when it comes to helping out. Additionally, another way to ask for a referral is through your Linkedin profile. You can research and network with who your customer knows.

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