Customer Referrals happen to be the most powerful aspects of generating new leads and increase sales. Many businesses have adopted various Referral Programs. Out of which, some are doing well, and the remaining are yet to make a mark.
They must be wondering what’s going wrong as they are continually striving to find out the real reasons for not getting referrals and accordingly identify the pain points.
Since customer referral has a decisive role in maneuvering the buying decision, the businesses need to take the necessary measurements. Research says that 78 percent of clients are ‘somewhat or very comfortable’ providing a referral to their advisor. That’s good news.
Then what aspects of your business refrain the flow of incoming referrals? Which elements of your business are responsible for it?
In this article, we will discuss 30 various reasons for not getting great customer referrals. It will help you to identify the loopholes and fill in the gap with appropriate referral program strategies.
1 – Customers may not have liked the product/service:
Offering quality products/services is quintessential for getting referrals. You cannot expect referrals if your products/services are not up to the mark. As long as you offer something that is in line with the customer needs and wants, and are of good quality, you will most likely get referrals, otherwise not.
2 – Presence of aggressive Salesperson:
Do you have salespeople who can act as per the customers’ psyche? Are they capable of handling queries and solving pain-points of the customers? Even if you have a top product/service or a sophisticated setup, it is not enough to get referrals.
Barring few, most salesperson starts with a sales pitch which is irritating for some customers—those persons who are selling need to be well behaved, intelligent, and maintain decency.
3 – Not enough trust in the brand:
Trusting a brand is essential for referrals. If the customers cannot trust the brand, they will never refer it to anyone. If we consider that there is somewhat partial trust, it is also quite tough to get referrals.
Customers will be skeptical while referring your products to others, and likewise, there can be some negative messaging about your brand.
4 – Customers are sometimes not exactly how your product might benefit their friend:
Sometimes, a communication gap exists between the customers and the business. Suppose the customers are not aware of all the product characteristics and do not possess the necessary information. In that case, they find it difficult to explain it to their peer group and thereby creates obstacles in referral inflow.
5 – Business operations are backdated and maintain old school practices:
Many businesses take enough time to come out of their shell when necessary to act differently as per modern times. The world is changing fast, and constant updating matters a lot in terms of getting referrals. It helps to stay in the competition and compete with the other players in the market.
6 – Not having a good-structured referral marketing strategy:
A survey on the referral program suggests – “92% of consumers around the world say they trust word-of-mouth and recommendations from friends and family, above all other forms of advertising.” To bring more pace in referrals, companies are engaging in the active promotion of products/services.
Without proper implementation of such things, a business cannot get enough customer referrals. Thus, it is mandatory to formulate a strategy that might yield better results in the overall endeavor.
7 – No digital presence:
Do you have a company website? No presence in the internet world will lead to the downfall of any business. You have to shred all hopes of getting adequate referrals. Referral programs work both online and offline.
But in the modern era, when people are more prone to the internet and online sources, it is essential to have an online presence. Now there are wide ranges of platforms you can be a part of. Start with a business website, and then you can move on to build a social networking presence in the form of Facebook, LinkedIn, Twitter, etc.
8 – Failing to determine and gauge the target audience:
For any marketing activity, hitting the correct target audience is paramount to success. Likewise, without knowing your customers, you cannot win the battle of getting referrals. Thus, your effort should be focused on the correct and feasible Demographics. Along with its understating buyer persona and act according to it will help a great deal.
9 – Referral programs are complicated:
Complicated stuff does not draw enough attention. That is why Referral programs need to be made accessible for customers to avail of the rewards. If it is too complicated, then the customers will be discouraged and thereby obstruct the flow of referrals. Making things complicated will jeopardize the activity and lead to null results.
10 – Referral program is not tailor-made:
Every business has its characteristics. Your business must have some unique elements that need to be taken into account while formulating a referral program strategy. If you follow the generic process without any customization, it will not help in receiving referrals. Thus, a tailor-made solution always yields a greater success rate.
11 – Incorrect timing to ask for referrals:
Are you asking for referrals at the right time – immediately after the sale, or during holidays, or on special occasions? If you are not doing so, then it will affect the process of getting referrals from your customers. Unless you contact your clients along each step of their journey to let them know you are looking out for them, referrals will get affected.
12 – Not exploring the marketing channels:
To grow your referral program through online channels, you must have a vivid idea of these channels and how they work. The opportunity to grow through online channels is vast and beyond boundaries.
Not exploring these platforms is a wrong decision, and you need to act upon it immediately. Without being a part of it, you are missing out on the immense scope of getting referrals.
13 – Not giving worthy incentives, benefits, or rewards:
Have you taken any steps to motivate your customers for referrals? Nothing is better than a ‘give and take’ policy. It generates great interest in the mind of your customers.
You will not get enough referrals until and unless you are motivating them by giving incentives or rewards. It can be anything about your referral program strategy. But there have to be some incentive schemes for the customers every time they refer someone.
14 – Poor after-sale service and support:
Are you taking care of your customers after the sale is made? Only selling is not enough. Selling something and getting away with it will hamper referral inflow in the long run.
To drive additional sales and increase engagement with consumers worldwide, companies are coming up with high-quality after-sales services. Now a day, good after-sales service and support counts, and without it, no business can stand and compete with other prominent players.
15 – Customers sometimes feel hesitant about upsetting their relationships with friends:
Though it sounds a little weird, there is truth. The customer, when unsure about the brand, falls prey to this mindset. Maybe the business could not impose much confidence in the customers’ minds to the extent that they will assume that all customers will receive the same treatment from the company.
Due to this, they remain in a state of dilemma that if their friends face unpleasant discourse or treatment from the company, it might create a tiff between them.
16 – Not taking proper care of your customer:
Customers are treated as Gods for any business. They are the people for whom a company generates sales and earns a profit.
No company could ever exist without a good customer base. Not taking good care of them will lead to a disastrous result of losing the opportunity and referrals. Customers must be treated with respect, honesty, and value.
17 – Customers sometimes cannot find out who could benefit from your service:
It would be wrong to think that customers are sympathetic. On the contrary, few are quite capable of giving sleepless nights. They pursue a bit of negative minded approach. However, this is not in the hand of the business to do much about it.
18 – Ignoring old customers and concentrating only on new ones:
You may be focused on your current clients. But everyone is essential, and they must be treated equally. You never know which customers can be your biggest asset in terms of bringing referrals. So it would be a stupid act to leave any stones unturned while talking about exploring all possible opportunities.
19 – Customer might have a bad experience:
Your client may have had a negative experience with the referral in the past and is understandably reluctant to try it again. Customers get irritated with the pushy sales pitch, avoid the salesperson who doesn’t hear the word “no,” and the email list that won’t let unsubscribe.
20 – Not doing enough to create the ‘wow’ factor:
You might have done an excellent job, but you didn’t wow them. To transform a satisfied customer into an advocate for your business, you must do much more to meet expectations. To motivate someone to recommend you to others, you have to go above and beyond their expectations. Even small touches can go a long way toward creating that “wow” factor.
21 – Lack of promotion about the referral programs:
Are you promoting the referral programs effectively? Unless you efficiently promote the referral programs, how can you receive referrals from your customers?
As discussed earlier, you need to generate interest in the customers’ minds and make them aware of the referral programs. Without promoting and motivating the customers, you will not realize the overflow of referrals.
22 – Company staff is not well-versed with referral programs:
How about educating your company staff with referral programs? Businesses comprise of people who are employees, customers, and stakeholders.
To make your referral program successful, it is the prime responsibility to educate them. It will enhance networking and community connections and disseminate information regarding the referral programs and its rewards.
23 – Busy and irritated customers:
Everyone is busy these days and inundated with marketing and advertisement messages, emails, and phone calls. The next time they need your services, your clients may not remember your name or website.
Sometimes they also feel frustration with the overdoing marketing methodology. Keep in touch with past clients, so they remember who you are. Keep up a regular cadence of communication, which should not sound like a sales pitch.
24 – Customer doesn’t know what to say:
Customers do not have a script or correct details about the product while conversing with their friends. They get confused at the time of knowledge transfer.
Maybe they miss conveying adequate information to their friends, which leads to non-productivity. Or perhaps they think it will be awkward because they may not appropriately present your product/services’ ideas/services.
25 – Customers sometimes don’t realize that you want them to give you referrals:
Do you always proactively ask for referrals? A study says that – “82 percent of the customers said that they were never asked for a referral from their service provider.” They are unaware of the fact that you want to build your business by referrals. Most small business owners don’t ask, and if they do, they don’t have a proper methodology or strategy to implement it.
27 – Tendency to forget:
Maybe you did ask for references from your customers once, but you didn’t want to keep bugging, so the subject never came up again. In such scenarios, they forget to make the referral.
Though they have good intentions, like everyone else, they are busy and don’t always know how to recognize referral opportunities. Doing business through referrals should be a central part of your marketing strategy.
28 – Not staying in touch with the customers:
Do you communicate regularly? Not maintaining a steady and proper communication with the customers is another reason for not getting referrals. A lot depends on calling customers, sending emails, informing and asking them what they like about you, selling new offers, and what they need.
The best way to get your customers talking about you is to ask for feedback about their purchase. Without these activities, referrals are tough to flow in.
Does it sound good to ask for referrals from the customers right after they made the purchase? Well, it’s debatable. However, if you promptly call your customers, though, you can use them as an ongoing referral machine.
29 – Lack of expertise and experience:
Are you aware of how referral programs work? The digital world is ever-changing. To remain on toes and explore the Referral marketing program’s latest trends, partnering with an expert agency certainly counts.
It helps in getting rid of any pitfalls due to a lack of experience and expertise. You will be in safe hands, and a Successful Referral Program will boost your business in many ways.
30 – Financial deficiency:
For any marketing strategy, financial planning matters the most. Every business spends adequate time to chalk out the expenses and accordingly makes the investment plan. If you do not have sufficient funding, you will find difficulty rewarding your customers for each referral, cannot offer worthy incentives, and step back in providing benefits. Though referral programs are cost-effective and it demands less expense, still financial deficiency can affect it.
Solutions to each problem are available at your fingertip. You need to partner with an organization that is a pioneer in this domain and can place expert advice.
A well-planned and tailor-made strategy for your business is the key to success in receiving referrals. For a complete referral process re-engineering and a new implementation of a referral program, NextBee is the perfect option at your disposal.
It offers essential and innovative features, such as – branded refer-a-friend and social sharing widgets, giving referral rewards tied to sales and subscriptions, and providing support for overlays, emails, microsites, etc.
Should you need more information, please feel free to contact us at 1-800-547-1618.