12.10.20154 min read

How To Make Customers The Best Advocates For Your Company

A customer referral can be a powerful force. In one study, the Wharton School of Business found that referred customers had a 16 percent higher lifetime value than other customers, which makes that cohort a key to the success of any business. While it is impossible to guarantee that your customers will tell others about your company, you can stack the odds in your favor with these steps:

1. Show interest in their needs

Your customers are less likely to advocate for you if they believe that you care more about their money than their needs. One way to demonstrate your interest in their needs is to offer free content or services that support both your customers’ objectives and your company’s mission.

For example, American Express and its OPEN Forum strive to support the growth of small businesses. American Express primarily accomplishes this aim with its business charge cards, but it also provides free information and tools via its OPEN Forum. OPEN Forum connects readers to business experts, fellow business owners, and quality content that helps American Express achieve its mission, while also building a client base that is passionate and excited to talk about the company.

2. Reward loyal customers

Rewarding loyalty is a great way to strengthen relationships with your customers. Consider offering a discount or a points program to your current clients, rather than to new customers alone. When you only reward new customers, you run the risk of upsetting current clients who are not eligible for similar discounts or rewards—despite their loyalty to your company. It is ultimately cheaper to retain a current customer than it is to recruit a new one, so showing loyal customers that you appreciate their business can help you create strong advocates and augment your bottom line.

3. Enable and incentivize advocacy

Take a moment to consider a second statistic from the Wharton School of Business: 83 percent of satisfied customers say they are willing to refer products or services. Only 29 percent ultimately do. For many businesses, there is a significant missed opportunity to get satisfied customers to promote their products or services. If you would like your customers to advocate for your company, you must first empower and incentivize them to do so. For instance, ensure that you have a system in place that enables your customers to easily share their positive reviews. This can be accomplished with something as simple as a form on your website or an email following a purchase.

When it comes to incentivizing customers, avoid paying them, as this can be misleading. Instead, offer an incentive that relates to the product or service that they bought. This can help you reward those individuals who truly believe in your product or service. Also remember to make the incentive a win-win for everyone involved. If you are a software provider, you might decide to offer current customers an add-on or discount for each new customer they refer. If you likewise provide this incentive to the new customer, you will be offering a loyal client a reward, and he or she can in turn offer something of value to referred acquaintances.

Some individuals argue that referrals (and advocacy more generally) should occur organically—that you should instead devote your marketing resources to other tactics. But referral customers can indeed be very valuable, and they are a direct result of the steps you take to encourage customer advocacy. While the methods you use will ultimately depend on your industry and your company goals, demonstrating interest in customer needs, rewarding loyal customers, and empowering and incentivizing referrals is an important cornerstone of any customer advocacy strategy.

Chuck Cohn is the CEO and founder of Varsity Tutors, a live learning platform that connects students with personalized instruction to accelerate academic achievement.


This article was written by Chuck Cohn from Forbes and was legally licensed through the NewsCred publisher network.

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