How to Build a Referral Program


A referral program is a system that rewards other individuals or businesses for sending paying clients to your company. It is common for service companies like real estate brokerages but also works for companies that sell tangible items, like makeup and fashion products. It takes time and networking to set up a referral program of your own.

  • Write an outline of your referral program. The outline should map out exactly how you'll handle a case where an individual sends a paying client to your company. Determine a reasonable referral fee that you can afford but that will also inspire people to want to actively participate in the program.

  • Create a written referral program agreement that you can present to all of your invitees to the program. Base the agreement on your outline and get your business lawyer to review it for clarity. It should provide clear details about the referral process, how to get credit for the referral, payment amount, and the timeline for when you will forward payment after completing a sale successfully.

  • Hire a professional graphics designer to create a web page and matching brochure that briefly describes the referral program.

  • Visit industry networking events with your business cards and brochures in hand. Talk to other colleagues in your industry who may be able to send business your way whether due to an overflow of work or a request for a service that they don't offer. Even if the referrer is a competitor, he can still make money through the referral.

  • Tap your existing client list to further build your referral program. Past clients are familiar with your work and can spread positive word-of-mouth to draw in new clients.

  • Highlight the referral fee when you discuss the program with possible referrers in person, over the phone or through email. This is usually the main selling point and motivator for getting people to start looking for people to refer to your business.

  • Provide referrers with the document outlining the terms of your referral agreement if they are interested so that each person is clear about how the process works. Ensure that they have your brochure to understand your products or services as well as your complete contact details, so that they can call you if they have questions.

Tips & Warnings

  • In some cases, you can pay referrers residuals when they suggest other referrers. However, study your state's rules regarding multilevel marketing schemes to ensure your referral program would not fall under that umbrella. Consult with your lawyer.

Related Searches


Promoted By Zergnet


You May Also Like

  • How to Create a Customer Referral Rewards Program

    Many businesses operate customer referral rewards programs to increase sales and customer participation as well as to stimulate interest in products or...

  • How to Start a Referral Service Business

    Some people have it in their blood to help others and give advice. If that's the type of person you are, then...

  • How to Make Referral Cards

    A referral program can be a powerful and cost-effective marketing tool. These programs are a type of word-of-mouth advertising in which you...

  • How to Create a Referral Form

    Referral forms can be used in a plethora of applications. Doctors, lawyers, counselors, friends and loved ones all can use a referral...

  • How to Make Referral Cards for a Hair Salon

    To make referral cards, choose a stylish design for the front, put identification information on the back and add an incentive for...

  • Employee Referral Programs

    An employee referral program encourages current employees to recommend people they know to fill positions in a company. This recruitment method takes...

  • Referral Marketing Ideas

    Referral marketing capitalizes on and, to some extent, formalizes the word-of-mouth process. Word-of-mouth referrals hold more weight than traditional marketing tactics, because...

Related Searches

Check It Out

Are You Really Getting A Deal From Discount Stores?

Is DIY in your DNA? Become part of our maker community.
Submit Your Work!