Client referral incentives can be a valuable and inexpensive way to build a business.
Every small-business owner knows that one way to inexpensively build a client base is to get referrals from satisfied clients. But how do you induce existing clients to refer new ones to you?
You should just ask. Business and marketing consultant Pinny Cohen in Fairlawn, N.J., points out that the people his clients refer tend to “match that client in outlook and perspective, so when a good client refers people, they are usually good clients. Make sure the person you’re asking a referral from is your all-star client.”
Cohen himself focuses on word-of-mouth referrals to help keep costs down. “My hourly rate has gone up over the years, but any one of my clients can refer another client to me, and I offer that new client the same grandfathered hourly rate as the referring client gets,” he says. “Instead of spending on advertising–and I don’t spend a penny–I’d rather pass on the savings to the customer.”
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