Tips To Identifying Individuals For Your Referral Network

Any business looking to grow and prosper needs a steady flow of clients to succeed. If you have a service-based business, that’s even more important. These types of businesses may have clients that only need their services once, rather than relying on repeat business.

A strong referral program is one of the best ways to bring in new clients and spread the word about your business. As part of a comprehensive marketing strategy, a referral program offers a cost-effective and high return approach to client acquisition.

What Is a Referral Program?

Referrals are recommendations that come from people in your network, such as your current or past clients. You could also receive referrals from business partners or other industry professionals. Referrals may come up organically or they may be part of deliberate marketing efforts.

Generally, referrals will happen naturally when clients are pleased with the service they received and want to share it with others in their network, such as friends and family. But a conscious effort to build referrals can get you better results.

A referral program does just that. This defined process rewards your partners for referring your business to their network, such as friends, family members, coworkers, and acquaintances.

It still leverages authenticity, but you set up a formal process to facilitate referrals and reward your partners.

Here are some benefits of referral programs:

  • Transactional value: Both the client making the recommendation and the client receiving it are rewarded for their role in your business. This could be with gifts, cash-back offers, coupons, discounts, or other incentives.
  • Authenticity: Because the referral comes from a trusted source, people are more likely to take the recommendation and act on it. They trust that the person making the recommendation had a positive experience.
  • Trust: Advertising comes directly from a business, so it’s not completely trustworthy. Referrals come from clients that received the services, and they have more influence over their social network.

Clients aren’t the only option for referral programs, however. Other professionals and non-competing businesses can help you with referral partnerships, and in return, you can refer clients to them to boost their own business.

Here are some common options for referral sources:


Clients are the heart of a referral program. Current clients have used your products or services and they are usually happy to share their experiences with others. Because they’re confident in the experience they had, their recommendation is more genuine and influential.

Past clients can also be of value. Even if it’s been a long time since you’ve seen a client, they won’t forget a positive experience. Following up is a chance to reconnect, see how they are, and request they participate in your referral program.

Prospects are another option. Though they have yet to take advantage of your products or services, they may have interacted with you enough to feel confident in what you have to offer.  

Family and Friends

Personal social networks are always a good option for referral networks. Your friends and family would likely use your business if they needed the services you provide and they’ll likely be happy to refer you to others.


Employees are an often-overlooked option for referral sources. As staff members, they believe in your business and they’re passionate about what you have to offer. They’re also familiar with the client base and their pain points, so they can answer questions or share information to potential clients.

Your sales and marketing teams are the best choices for referral sources. Both of these teams understand your clients well and what you have to offer, so they can share recommendations in a compelling way.

In addition, these teams may have suggestions for potential industry professionals or business partners that could be part of the program.

If you have a large business, other teams like customer service and human resources could be brought into the referral program. Like the other teams, they are proud advocates and offer insights for prospective clients.

Business Partners

Non-competing businesses and industry professionals can be part of your referral network with benefits for both parties. If you have an overlapping audience and both of you refer your businesses to each other’s clients, you can significantly widen your reach with little effort.

Consider companies that have complementary products or services with similar clientele. For example, family law firms and prenuptial agreement firms may have overlapping clients and opportunities for referrals.

You should also think about professional associations your clients share or purchases that happen in coordination with your own, since these businesses likely have access to clients that would need your services.

Referrals from other businesses are typically easier to set up since both businesses benefit from the partnership. For example, a veterinary hospital has clientele that may need pet boarding, grooming, or dog-walking services, and having a partnership with these businesses offers an opportunity to not only promote other businesses, but serve the clients needs better.


Though paid marketing, influencer marketing offers some of the same benefits as word-of-mouth recommendations. Like friends and family, the followers of an influencer consider their recommendations and will often listen to what they have to say. If an influencer promotes a brand, their audience listens.

There are many different types of influencers in different industries. If you’re considering a brand collaboration or partnership, make a list of influencers that are a good fit for your business and start reaching out about a collaboration.

Remember that influencers are compensated for their recommendations. Be sure to discuss the terms in advance and consider influencer marketing in your overall marketing budget. Consider whether it’s a good return or if you’d be better served by your other referral partners.

Create a Referral Program

Finding referral partners is the first step to creating a strong referral program that can bring in new clients and revenue for your business. When you find the ideal referral partners, put together a referral program that offers incentives for their efforts and enjoy the influx of new clients. 

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