Our principal recently wrote a post about micro influencers, those luminaries with noteworthy social media followings not in the millions, but more likely the hundreds or thousands.
Micro influencers are perceived as more sincere and less salesy. They’re perceived as subject matter experts, which oftentimes they are. As such, micro influencers play to self-selecting audiences who trust the influencer’s judgement.
Now shrink the audience of a micro influencer down to a single person. Their relationship is closer, more personal—in fact, it’s possible the influencer and the audience-of-one know each other. At this point, the relationship graduates from influence to referral.
Why does that matter? Because, according to numerous sources, converting referrals is a lot easier than converting any other kind of prospect. For example, a few years back, Nielsen found that “recommendations from friends and family, often referred to as earned advertising, are still the most influential…84 percent of global respondents…said this source was the most trustworthy.”
That makes sense, right? Family and friends share their experiences with a brand, that makes you decide to give that brand some consideration. And it’s not just friends and family. It’s trusted people you do business with. It’s trusted colleagues in positions similar to your own, working at your company or a different company. You get the picture: The old-fashioned value of word-of-mouth (WOM) advertising never goes out of style.
The term earned advertising was mentioned above. Referrals are earned advertising, as are all WOM connections you get from your presence on blogs, in social media, and from the goodwill your product or service generates. A good thing about earned advertising: The leads you get are well-qualified. Another good thing about earned advertising: You don’t have to pay for it.
But then again, maybe you should.
What I’m talking about is systematizing and incentivizing referrals using software designed specifically to do just that. Systematizing—that’s how you officially recruit and enroll referrers, and structure communication with them as those they refer move through your sales funnel. Incentivizing—that’s how you pay referrers to do more referring.
As I said, WOM is never out of style so there are lots of incentivized referral programs in place. Vendor partners, current customers, your employees: When these resources are systematically incentivized, they transform from influencers to salespeople. In fact, these programs build brand loyalty by encouraging and rewarding ‘stakeholders’ to invest more in your brand.
Your takeaway: Earned advertising comes in many forms, but paying actual cash to augment results can really pay off. If your brand hasn’t instituted an incentivized referral program, it should probably start looking into it. If you need purpose-built software that can automate and manage your referral program, there are plenty of vendors out there. And, if/when you launch your referral program, creatively promoting it with agency help can make it more effective sooner.