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5 Strategies To Grow Your Referral Business

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Referrals are one of the best ways you can grow your business.  If you don’t already have a referral marketing strategy in place, you’re leaving a lot of money on the table.  

On top of the money that you’re missing out on, you’re also missing out on one of the best opportunities you’ll have to increase your customer base by using some of the most loyal customers you already have.  

When they refer other people to your business, the new customers you generate will become just as loyal, giving you even more opportunities down the line.  

Referral marketing is one of the strongest strategies you can use to grow your business, and one of the strategies that made companies like Airbnb, Dropbox, and even Facebook so popular, so quickly.

The following five strategies will help you implement and grow your referral base, while making it easier for your existing customers to send you new business on a regular basis.

Before we get started, though, you’re going to need to....

Focus On The 80/20 Rule


If you’ve been in business long enough, you already understand that most of your customers aren’t going to provide new referrals to you.  It’s just the nature of the beast.

A wise philosopher, Pareto, dictated that 80% of your results are going to come from 20% of your efforts.  The same is true for your customer base.

80% of your referrals are going to come from 20% of your customers -- those raving cheerleaders that you’ve already sold on your products and services, that are going to be loyal to you until the end of time.

As a business owner and someone wanting to increase their referral network, you’re going to need to identify those 20% and then figure out new ways to stay in front of them, while getting them to spread your message for you.

When potential customers hear someone they know talking about you, it’s going to create instant trust for your brand and products that is hard to match with any other marketing technique you can use.

Strategy #1: Provide Exceptional Customer Service

The only way you’re going to get your existing customers to start talking about you to their friends, family, colleagues, and random people they meet on the street is to make sure you’re providing the absolute best customer service and product purchasing experience possible.

By devoting your entire business model to service, it’s going to practically force your customers to start talking about you. Think about Apple, for instance.

A customer that goes into Apple to have a broken screen on their iPhone repaired leaves the store with a brand new iPhone, rather than just having their screen repaired.  This is a true scenario that happened because Apple’s systems were down and they couldn’t bill the customer for the repair.

Instead of having an upset customer, Apple’s store went above and beyond to please the customer, which is going to get them talking about their experience to other people.

Strategy #2: Pay Attention To The Data

The numbers don’t lie. 

If you have data that you can follow to help determine who the 20% of customers are that continually refer new business to you, or the 20% of websites on the internet that consistently refer new traffic to your website, you need to spend more time focusing on those key customers and websites, in order to generate even more of the same referrals.

If you’re not actually watching your data, though, you’re letting a prime opportunity pass you by.  

Either by using analytics on your website, or a CRM system in combination with a referral reporting system, you can get a clear picture of the 20% of customers or websites that are sending new business your way, and then focus on getting them to do it more often.

Strategy #3: Make Your Product Experience Shareable

creating a great customer experience from purchase to packaging can help encourage referrals down the lineImage Source: Christy Lee Design

Excellent customer service is just one way to get people talking about you.  Another is by wow’ing them through the way you deliver your products and services.

One company that’s a great example of making their product experience shareable is Everlane.  The packaging they use, along with the way they reach out to influencers to get them to help spread the message has helped them achieve massive growth over the last few years.

Sometimes, something as small as a handwritten thank you note inside of your boxing is enough to get your customers to share their experience with your company.

When you get people sharing their experience, dig into what it was about your company, products, or services that made them go above and beyond to tell their network about you. Then, focus more on providing that same experience to your new customers.

Strategy #4: Make It Easy For People To Refer You

it seems simple, but making your referral program easy to access is the best way to encourage program adoption and grow your referral business Image Source:

The easiest way to make the sale is by simply asking for the sale, while also making it easy for your customers to buy.

The same strategy works for building a referral marketing engine.  If you simply ask people to refer your business to their friends, family, and colleagues, some will take you up on it.  When you incentivize the sharing of your business, even more will take you up on it.

Make sure that people understand that sharing your business with other people will result in a reward for them, and then ask them to refer you to other people.

Ask them to share your posts on social media.  Ask them to blog about their experience with you.

Make sure there are buttons on your website that make it easy for them to refer other people to your business.  Add social sharing buttons to every product page.  Include a link to your fan pages on every email you send.

Strategy #5: Actually Implement A Referral Program

One of the best, most cost effective strategies you can use to generate new referrals for your business is to incentivize the process for your existing customers.

By giving them rewards, and making them a part of a “member’s club”, you’ll build a level of exclusivity that will compel your customers to start sharing, and become even more loyal to your brand.

Think of the “member’s club” as another marketing expense and, in the end, it will end up costing you less than generating new customers would, using other marketing strategies.

There’s no mistaking that referral marketing is one of the best ways to grow your business, but it can also be one of the hardest for business owners to understand.

Using the strategies we’ve broken down for you here, you have 5 new ways to tap into the 20% of customers who are already sending you new customers, and get them to work even harder to help grow your brand in the future.


james crook choc chip digitalJames Crook - Author, Speaker, Web Marketer - is the best selling author of “Digitally Enhanced” and founder of marketing agency Choc Chip Digital. He works with hundreds of small businesses each year to grow their client base online, and is a passionate advocate for the power of authentic, heart-centred marketing. Widely recognised as a confident and articulate communicator, James draws on his love of digital technology to inspire, motivate and educate audiences across Australia.