Customer referrals are one of the most effective marketing strategies that can elevate your auto shop’s sales. In fact, 20-50% of all purchasing decisions are made by word of mouth. Moreover, people are four times more likely to purchase a product or service when a friend has something positive to say.
However, since you depend on your customer to voluntarily refer their friends, it can be difficult to build traction. That’s where incentives come in. Incentive-driven referral programs directly motivate your customers to get out there and spread a positive word about your shop.
In this article, we’re going to explore four critical elements of a great auto shop referral program. Let’s get started!
The first crucial component that will help your referral program succeed is awareness. People need to know that your program exists for them to actually use it. Airbnb’s first referral program actually flopped because no one knew about it—not the customers, nor the employees. Their failure is a prime example of why it’s so important that you take steps to build awareness around your customer referral program. How can you do that?
- Tell them. You can verbally tell every customer that comes in to your shop. It doesn’t need to be a long-winded explanation about why they should use your referral program. Instead, offer a short reminder that if they were satisfied with their service today, they should tell a friend. Make sure you include the benefits both parties will reap as a result of the referral.
- Email them. Another way to build awareness around your referral program is to create an email list and send out regular emails with all the information they’ll need.
- Text them. Take advantage of text messaging as a mode of communication. Text messages have an open rate of 98% so you’re almost guaranteed to reach your customers.
- Connect on social media. Finally, consider running social media ads about your referral program to further generate awareness. Even Google advertises their referral program on Facebook ads—you should too.
The bottom line is to educate as many of your customers as you can about your referral program. Be creative. Come up with unique and impactful ways to get the message across.
Ease of Use
The next element that will strengthen your customer referral program is ease of use. Even if your customers know about your program, if there are too many obstacles in the way of actually benefiting from it, no one will use it. We call these obstacles user friction, and the goal is to minimize the user’s friction so that they actually use your program.
For example, say you’re running a refer a friend promotion and both your customer and their friend receive $20 off your next oil change. It should simply be that if your customer refers someone by providing an email, they receive a coupon and their friend is emailed one.
Consistent Data Analysis
Without examining the data and seeing what motivates your customers, you won’t know what changes you need to make. You could just guess what will entice your consumers and blindly launch your program. Or you could analyze relevant data, see what truly incentivizes your customers, and strategically create your referral program from there.
For instance, examining what services your consumers use most will help you identify what incentive will best motivate them. Moreover, figuring out what mode of communication your customers are most active in will tell you how you should be reaching out to them.
The final—and most critical—element of your referral program is the incentives themselves. These can make or break any referral program. No matter how much awareness you generate, how easy your referral program is to use, or how much data analysis you conduct, if your incentives aren’t superb then your customers won’t care.
The goal is to make your incentives attractive enough to motivate every customer to tell their friend about your shop. Here are some potential incentives you can use for your auto shop’s referral program:
- Both parties get $20 off their next oil change
- The recipient receives a percentage discount off their next purchase
- The sender gets shop credit they can use on anything
From automating emails to text messages, this can be a great way to remove the tediousness from a referral program and simplify it for you. That’s where BayIQ comes in.
BayIQ is an industry-level marketing software developed by former auto shop owners. Our software automates everything from online reviews, digital marketing, and—you guessed it—a referral program. This feature integrates directly with your current point of sale. All that it needs is for the actual award to be attributed to the platform.
Customers are given the ability to email a referral link to their friends and family as well as create a post on Twitter and Facebook. You can easily track data and monitor progress.
Creating a referral program can be a tedious task unless you do with BayIQ.