Six Steps to Build a High-Converting Referral Program at Your Store


Social media, video marketing, and email newsletters may be all the rage. Nevertheless, there is a form of marketing that seems to fit the profile of being low-cost and effective in generating leads: referrals. People are four times more likely to buy an item when referred by a friend. Additionally, referral marketing generates three to five times higher conversion rates than any other channel. For your dealership, referral programs should be as high a priority as any other marketing strategy.

Its significance is apparent, but how do you build a high converting referral program for your dealership? Here are the steps you and your team should take to build an effective referral program.

What is a Referral Program?

A referral program is a way for you to create a system for inviting customers to spread the word about your products with other people. It incentivizes them to remind their friends and family about what you offer, and how they benefit from visiting you instead of another dealership. If used effectively, they can be an excellent way to generate leads and expand your audience.  

Offer Exceptional Products and Customer Experiences

This step may be a give-in, but it’s important to discuss how vital it is to offer a product and service that your customers want to share. For your dealership, this will most likely heavily involve the customer experience. You will need to address what you are doing that differentiates you from the competition and adds convenience to your customers.

Put the focus on these services and endeavors. For example, you may have an intake process that makes the customer’s shopping experience more straightforward. Play up things like this with your audience and sharpen them when you can. Seventy-two percent of customers will share a positive experience with six or more people. Therefore, you want to have tactics that motivate your customers to spread the word. referral

Get to Know Your Audience 

Again, to attract your ideal customer—and drive them to invite others to visit you—it’s crucial that you get to know them and understand what drives them to keep coming back. Set times to have meaningful conversations with your customers to find out what they like and what they don’t. Also, be sure to offer surveys so you can ask specific questions about your services.

From there, you can see which services and experiences you offer that resonates with your audience. You can then use this information to start incentivizing offerings at your dealership. For example, if your service department’s oil change services are popular with the local customer base, consider working it into your referral program. 

Identify the Goal of this Program 

What are you looking to accomplish with this referral program? Do you want to increase brand awareness, or is it important to improve your lead generation? Know why you are developing this referral program and create benchmarks to ensure you meet your individual departmental and company-wide goals.

Create SMART (specific, measurable, achievable, relevant, and time-based) goals to develop targeted objectives. For example, you may want to increase the number of inventory site visits by 20 percent, and you can then connect this with a referral program that promotes this specific goal. 

Offer Rewards that are Appealing to your Customers 

This is information that you may have likely picked up while exploring your audience’s preferences. Start by seeing what your most popular services and products are. This strategy enables you to begin to develop referral programs that promote these items.

Additionally, you need to figure out what you will offer the referring customer as well as the family member or friend who participates. You may find that some of your customers would rather receive cash or a percentage off on a vehicle when referring your dealership to a family member or friend. Use this information to build referral rewards that your customers and the people in their networks will want. 

Make it Easy for Customers to Refer People to Your Dealership 

The last thing you want to do is make it tough for your customers to refer people to you. So, it would help if you experimented with a variety of ways they can do this. For example, you can direct them to download your dealership’s app to locate a special code to give to a friend.

On the other hand, you may want your customers to email your sales team with the referral’s name and contact information. Determine the method that best works for your dealership and implement it. However, don’t be afraid to switch things up and try something new. 

Continue to Remind Your Customers 

Your customers—much like you—lead busy lives. Therefore, referring people in their network to you is not always at the top of their minds. Consequently, it is vital that you find a balance between spamming your customers and reminding them about your dealership’s referral program. This process could look like sending an email promotion once a week or generating push notifications on your customer’s smartphones. Decide on the best way to remind your audience and never assume they will remember on their own. 

Referral Programs can Send your Dealership Marketing to New Heights 

These days, everyone is looking for affordable ways to reach new audiences. Referral programs can be an effective and low-cost way to motivate your customers to become ambassadors of your dealership. As you plan to do this, make sure you understand what you want the dealership to get out of it, develop incentives that your customers will want, and continue to remind them. It is an act of appreciation and growth marketing all-in-one, so consider adding this to your marketing strategy mix.

Did you enjoy this article from Chanell Turner? Read other articles from her here.

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