Our clients are dental clinics and a good new client spends $10k-$20k with us the first year. In this industry, word of mouth is very important for trust. We have personal relationships with each of our clients. There's one client who likes to nag a bit to get a lower price. I offered the client a 10% referral bonus but she said that she would refer us clients anyways without the fee. If we offer the bonus then it's not internally motivated and we feel like they are doing it for the money but not because of our good service and relationship they have with us.
Every referral plan must consider three key components to drive desired results: 1) Profit Margin - your profit margin will determine if and how much referral incentive you are able to offer. 2) Referral Amount - I can't tell you how many times I have seen referral programs that monetarily are not worth the effort as a customer. 3) Ease of Use - How easy is it to retain the bonus? This a key driver driving behavior.
Hope this helped!
Answered 8 years ago
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