Referral programs are an underrated form of marketing. We explain why, and how to start one for your own self-storage business.
As a self-storage business, there are a variety of ways you can market your company towards potential customers, but one of the best and most reliable methods is to create a referral program. Your customers will tend to trust the people they know, and they most likely are already talking about your company in conversation, so finding a way to monetise it should be a no-brainer.
Benefits of a referral program
Simple to implement
Referral programs work by using incentives to drive customer action. This can mean discounts to current customers if they refer your business to their friends, or it can mean a free month’s rent for that customer. The new customer that has been referred would get the same deal and ideally this creates a sustained chain of referrals. Again, customers will tend to have spoken about your company already anyway, so incentivising them to refer is a simple way to use word of mouth to your advantage.
Referral programs are also great for your businesses’ bottom line. There aren’t a large number of extra costs for running complex ad campaigns, outsourcing fees or anything similar. Other than the original rewards included in your program, the cost of running a referral program is, in the majority of cases, exceedingly dwarfed by the revenue generated and customers gained.
Customer attraction and retention
The Self Storage Association Asia Annual Survey 2020 revealed that 36% of new business for self-storage companies come from referrals. The knock-on effect of continued referrals means that you’re constantly able to attract new customers, and in turn have them introduce new business. Another key benefit of a referral program is its ability to retain existing customers. They’ll feel more welcome and a part of the community by introducing others to your company, and keeping someone’s business is much cheaper than finding new business.
Builds a stronger customer base
A referral program can often also increase customer engagement, and leave you with a larger customer base that is more loyal to your company. They will tend to be more interested in what products or services you have to offer and also connect you with more people throughout the community. As a referral program is mutually beneficial, you’ll be able to increase your presence within a community and have a stronger base of customers as a result.
Building your referral program
Choose a product and an aim
Having chosen to start a program, the most important and basic step of building up is choosing what you’re going to promote and what you’re trying to achieve with this program. You can either pick a specific service that might be underperforming, or just a company-wide discount would work also. The most common incentive for self-storage referrals is probably just a free month’s rent on a unit, but this might not always suit your needs. Make sure that whatever incentive you choose, it suits your aims. If a general revenue increase is what you’re after, a larger scale general discount will work better. But if you’re focusing on a specific product, make the incentive related to that service also.
Make it simple
Some companies make the mistake of over complicating their terms and conditions on a referral program. Adding too many stipulations is more often than not going to turn your customers off from this deal. They want something that can benefit them without being difficult to understand or a big hassle to achieve. You should know what your customers want, and create a program that will target both what is beneficial for them and also your own company.
Make it personal
Sometimes a little overlooked, but it is important that your referrals seem organic and come off as personal. Referrals work precisely because people will tend to trust other real people rather than an online advert they might find. Talk to your existing tenants about the program in person, and they’ll be more likely to recommend your company to their friends, because of the connection you’ve made. Sometimes a flyer or brochure will still feel too detached for the customer so making the deal seem more of a ‘friendship perk’ will do wonders for both your company’s brand and the referral program.
All in all, referral programs are extremely simple to implement and can have massive upside for your business. Referrals should be central to your company’s marketing strategy and hopefully the tips given will have you on your way to start one at your own facility!
Other than referrals, there are a lot of ways to increase your conversion rates. It’s up to you to test, learn and optimise.
How Storeganise can help
Storeganise has referral code functionality built in allowing you to automate the marketing of referral programs by customising email notification templates sent by the system as well as automating the tracking of successful referrals. Separately, using existing integrations, you can leverage 3rd party referral and affiliate tracking programmes within the Storeganise Customer Apps.
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