It’s the best case scenario: You sell to a customer who loves your product SO much they tell friends, family, and colleagues all about it. Suddenly, you have a flood of new business leads for your company – acquired for free – and all interested in signing up for a trial of your SaaS product.
Any experienced sales rep will tell you that these kinds of referrals are hands-down the best business prospects out there. Referrals are more open to sales conversations, more engaged with reps, and more excited to learn about your product – what could be better than that?
Now that you’re excited to work with referrals, how do you get out there and start finding more of them for your company?
Create a Referral Program
If you’ve gotten a few referrals so far, you definitely want many more to help drive new business. The best way to encourage referrals is to create a powerful customer referral program. You may already have some superfans out there that love telling others about your product, but that’s not every customer. Even if they are happy with your product, most customers won’t offer to refer friends or colleagues unless you specifically ask them to do so. Once you ask, you’ll be surprised how many people are happy to give you the email of a colleague or a friend. If you already have an existing partner program or customer community, it’s easy to leverage that asset to build a referral program quickly and easily. Set it up and launch the new referral program with some fanfare to get customers excited – and you’ll see new, warm leads start to roll in.
Strongly Incentivize Referrals
While some customers will be happy to refer people to you for free, others want to be rewarded for their efforts. If you really want to drive a large number of referrals, offer some kind of reward or incentive to customers who give you a colleague’s contact information. This can be anything from a gift card to a discount on your product prices – it’s really up to you. If you prefer not to offer a monetary reward, give away access to something special like lunch with your CEO or another exciting perk. At InsightSquared, we take it a step further and offer personalized rewards to customers to thank them for referrals. In fact, we use Influitive’s AdvocateHub to recognize and reward our top customers.
Drive SaaS Success
Referral programs like this have the added benefit of helping keep your existing customers even happier than before, and bringing in referral customers, who often become your new happiest customers. And as you well know, customer happiness is vital for SaaS companies. You’re always incredibly focused on the one metric that matters: Monthly Recurring Revenue (MRR). To keep that number up, many companies focus on driving down customer churn while also closing new business. This is where referrals are so valuable – not only is new business from a referral less costly to acquire and easier to close, it also ensures your newest customers are happier, more satisfied with your product, and less likely to churn.
If you create a powerful SaaS referral program, you’ll see returns upon returns upon returns from your initial investment. As each new, happy customer comes through your door, you’ll get a list of more potential customers to sell to, who in turn become more happy customers. With this cycle of happiness, you’ll see your MRR shoot through the roof.