Use Referral Marketing to Grow Your Business

When you’re up against a competitor who’s better funded, more established and has an entire marketing team to throw against you, there’s one trick small business owners can use to keep their edge.

The referral.

For a small business, referral marketing is one of the most powerful selling tools you can use, as they always win out as the best source of new leads.

Here’s why:

  1. People would rather do business with someone they know than a stranger, and a referral forms a connection.
  2. There’s nothing better to build trust than a real recommendation from one of your friends.

So how can small-business owners start using referral marketing?



Your first job is to make it as easy as possible for your customers to sell “you.” Put together a clear and concise value proposition, demonstrating how your business is different to everyone else.

Here at Studio Digita, we build websites for business owners, and take care of your entire online strategy. What sets our team apart is we’ll get you online fast (just a few weeks for a simple website), we’re easy to get hold of, and we treat every customer like a friend – so you get awesome support.



Asking for “more customers” is too broad, you need to narrowly define your perfect customer.

Personally, my target customers are small to medium sized business owners, who are operating service-oriented businesses or selling a handful of products online. Depending on the latest project my team has finished, I’ll ask my clients if they know any other business owners in that specific industry, as I’ve now got a finished product that showcases our skills in a specific industry.

Using this approach, I’ve found my clients tend to always be happy to refer my services, and we built our entire client base during our first year of business just using referral marketing.



You’ve got to believe in the products you sell, and know you deliver great value to your clients. When this is the case, you should have no trouble asking your clients who they know that will benefit from your skill and expertise.

You’re not a dodgy salesman asking for a favor, you’re a proud business owner who delivers a fantastic service that everyone can benefit from.



Do everything in your power to blow your customers minds.

You’ve got one chance to wow them, and let’s be honest – what are your customers more likely to talk about? The “okay” service provider they’ve been using for ages, or the new company which treats them like a VIP? Be amazing and give your customers a reason to talk about you.



Be upfront with the incentives you offer in your referral program, and incorporate asking for referrals into your sales pitch, so new customers know you’ll be expecting a handful of leads once a project wraps up.

As you’re signing a new contract, ask the customer “If you’re blown away with the job I do for you, will you be happy to refer 3 prospective clients to me?” This way, they’re expecting itwhen you do ask.



It’s awesome when you receive a recommendation you’ve just landed a new client who is rearing to go, but it’s not a one-way street. You need to return the favor, because you might get away with it once or twice, but if there is no reciprocal value to the friend who has been sending you the leads, they’re probably going to taper down the referrals they push through.

Be interested in your clients’ businesses, and always give them a little love back too.



If you’ve just met a new contact or landed a new client and you have an opportunity to sling their way, do it!

As soon as possible, send them that referral. This does two things. First, it demonstrates you’re not just talk – you follow through on your actions. Second, it can create a feeling of obligation, and this client may work even harder to return the favor.



Work on staying relevant, to keep your business in front of your customers. Once the excitement of the project starts to dwindle after it’s complete and your clients are back running their business, how do you get them to think of you?

Provide content that’s valuable to your clients, and ties back in to your value proposition.

Perhaps you’re hosting an event in the industry, can comment on the latest innovations or research, or have new customer success stories to share. Pick an email marketing software and keep your customer database updated, write posts on your blog and be active in your local community.



Once a customer has been referred, it’s still not a sure thing. According to insights from the Hinge Research Institute, new potential clients will:

  • Check your company website and social profiles (80%)
  • Perform a Google search on both you, and your company name (60%)
  • Ask a second trusted source their opinion of your business (60%)

This makes establishing your online reputation critical, because what these referred clients find will determine if they actually reach out to you or not.

Here you need to put a face on your business, with content like explainer video’s that demonstrate your expertise while being very shareable, articles that are helpful, or even news and media articles on your business for the awards you have won.



Show your gratitude with every referral received. Say thank you to the client who pointed the new lead in your direction, and don’t forget to keep them updated with the progress – they will be genuinely interested.

It’s also good practice to treat each customer for a successful referral, so make the time to take them to lunch to show you appreciate the business they have generated for you, or pay them the fee you offered in your referral marketing program.


Referrals are the single most powerful tool in your sales kit. Every customer you work with has a network of friends and business contacts they are in regular contact with, and getting access to these people can grow your business exponentially. Use these strategies to ensure your business is taking advantage of the power of referral marketing, and you’ll be well on your way to success.

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