Research results have shown that referral marketing is more effective than traditional billboard advertisements, TV commercials, etc. Come to think of it. You probably ask the people around you first before you try something new.
You might search online to read reviews. But, you trust the opinion of your friends and family more than that of a stranger online.
As a rule of thumb, people tend to believe word of mouth from their friends and family more than what a TV commercial says. However, besides the general practice, there are several other reasons why referral marketing is currently the most effective way of promoting your products, some of which includes;
The Viral Nature of Referral Programs
We have social media to thank for the viral nature of the referral program. It only takes one of your customers to share your referral program link, and hundreds of their family and friends would have seen it. With the click of a button, you can only imagine how fast it would grow your business over time.
One of your customers shares your link or well-structured write-ups to their social media page. Their followers get to see it, and they click, becoming a customer. The new customer also jumps on the referral program, sharing your link with people on their social media page, and the cycle becomes endless. This cycle means more customers for you.
Creating Loyal Customers
You may not know the length to which your customers are loyal to your business until you create a referral program. However, when a customer can willingly refer your business to their friends and family, they automatically become your brand advocate. They are like your business cheerleaders, rooting for you.