Many experienced marketers say that an insurance agency referral program is one of the single most effective marketing strategies you can pursue. Research bears this out:
- 91% of business-to-business (B2B) purchasers’ buying decisions are influenced by word-of-mouth.
- 88% of B2B decision makers rely on word-of-mouth (online and offline) for information and advice.
See more on the effectiveness of referral programs: 61 B2B Referral Marketing Statistics and Quotes.
That gets us to issue number one: What would motivate a business to refer you to another business? Hopefully, your services are so valuable that they find it worth their while to share a tip with a colleague or someone in their network. People like to share a good find. Think of the last time you made a B2B referral. Chances are, it was because the business you promoted knocked it out of the park in terms of service, value, results, or a combination of these things.
Your referral program should obviously be geared to generating actual business leads that you can act on, but it can and should be more comprehensive than that. Advocacy and word-of-mouth endorsements from clients and businesses can also be compelling forms of referrals that can be deployed on your website and social channels to reach and influence a broad audience of prospects.
The fundamentals of launching an insurance agency referral program
Before you embark on or change your commercial referral program, take a snapshot of where your current leads are coming from now. Track who your referral sources are so that you can evaluate your best sources and where to put your time and energy for maximum results. If you haven’t analyzed your current lead sources recently, it may be instructive.
As with any business discipline, it starts with creating a process. While an unsolicited referral might occasionally come your way, you need a plan to ensure they happen. Establish goals, timelines, the process, the tools, templates, scripts, and the staff training. Create a plan to track, follow-up, measure results, and refine your efforts. For more on setting up the mechanics of a referral program, see How to Build a Customer Referral Program.
Best practices and creative ideas for your insurance agency referral program
Here are best practices and creative ideas to make your referral outreach a success:
- Provide superlative service. Referrals are earned. To get referrals, give your clients something to rave about.
- Communicate frequently. You need to stay top of mind and build an ongoing relationship. People are more likely to refer a business they know, trust, and feel a connection to. Relationship management is not only important for referrals, but for retention, too!
- Repetition is essential. One request won’t cut it. Studies vary about how many times a message should be issued to be heard, but many say the sweet spot is seven; others say as high as 20.
- Promote your referral program through multiple channels. Don’t rely on just email – promote your program on your website, in your social media channels, via traditional mail, events, and sales collaterals. LinkedIn is a great commercial social channel.
- Ask for the referral. According to Dale Carnegie, 91% of customers say they’d give referrals, but only 11% of salespeople ask for them. Develop a script and have your people role play to get comfortable. Determine the best timing in the customer experience cycle for requests and watch for opportunities when clients might be amenable, such as when you get them an unexpected discount or provide a special service.
- Make it easy for referrers to act. Create a simple form on your website: “Know anyone who could use XYZ insurance services? Let us know and we’ll follow up!” Create tools they can pass along to business colleagues – brochures and sales sheets.
- Create compelling, useful content demonstrating your expertise. Produce content that people want to share and ask them to share it with their customers, their network, their industry, and on social media. Include a brief intro to your agency and a connection for more information.
- Get endorsements. Even if a client doesn’t have a lead for you, ask for a testimonial to put on your website and use in your marketing.
- Create a case study or a success story that highlights the client, your relationship, and some achievement or success. With their permission, submit it to trade publications. Post it on your website or blog.
- Don’t limit your referral program to clients. Leverage your business partners, vendors, and business networks.
- In addition to seeking referrals for leads, look for referrals for speaking engagements at industry events and meetings.
- Team up with clients and business partners to put on risk management or loss control webinars for customers or industry associations that they can invite clients to attend.
- Thank referrers. Send a handwritten thank you note, perhaps accompanied by a box of chocolates. Consider a donation to a local charity in their name, or a donation to their employee activity fund. If you have any type of incentive, double check with your state insurance authority to ensure there are no regulations prohibiting this.
- Be sure to follow up with referrers to tell them the outcome of any referrals they offered.
- Practice what you preach. Be generous with referrals you make. Think about great business partners and clients that you can refer and take the first step. At the very least, it will deepen your relationship and may be reciprocated.
- Rocket Referrals is a popular insurance-related automation system that posts great ideas on referral programs, among other topics and tools.
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