Hi everyone - I am new to this workspace. I am here because I want to set up a robust customer referral program for my company, but what seemed simple is turning out to be very complicated. So I would love any and all advice.
For a bit of background: We are a SaaS company that mainly serves midsize businesses in the USA. Our target audience consists of the decision makers in the finance department and the accounts receivable business function. Some examples of titles we target include CFO, Controller, Accounts Receivable Manager. We have a pretty strict ICP, so we will have to have pretty strict rules on who can qualify for a referral (company size, industry, job title etc…).
I have a few questions that I would love answers to:
1) When should we offer incentives? I was thinking a large payout once a customer signs would be the way to go, but my boss thinks it might be more effective to offer an incentive for referring someone to a demo. He is also worried about causing tax problems for our customers with large payouts.
2) How do you prevent fraud? Specifically someone posing as a qualified prospect just to get the incentive.
3) What is the best way to streamline and automate this process? For now I can be hands on, but it would be great if there was a way to automatically send incentives as meetings happen, customers are signed etc…
Looking forward to the advice.
Hey Sarah! I have thoughts here. I’m at an event today, but remind me if I don’t respond by tomorrow?
Hi
I'll start by saying that I think people underestimate the work that goes into a successful referral program and the logistics to operate one. And I don't know that it's always best for B2B because of the tax issues, some companies having policies against referring to a vendor, complexities of buying groups, etc. (usually the person who is influenced by an incentive doesn't have the decision making power). 🤷
1) When should we offer incentives? I would agree with you. Incentive should be based on deal closing. It's not uncommon to have payout be net 30 or net 90 post-sale. That way they get paid when you get paid. Otherwise, CPL is going to skyrocket, and unless those are real and closing at a higher rate, that's going to hurt your marketing metrics.
2) How do you prevent fraud? If you incentivize based only on close, you avoid this. Any time you incentivize lead gen, you run into a likelihood of low-quality leads that won't convert.
3) What is the best way to streamline and automate this process? You could build this into your CRM or use a referral platform that integrates with your CRM.
Something other things to consider:
just to add on the great answers above.
I would recommend having a 2 step incentive:
yea 2nd on the multi-stage reward - ie def pay for successful intro call as well - closed deal is too far/rare of a reward
