Written by David
13th May 2013 • 4 min read
Customer recommendations are the lifeblood of any successful business. In the age of social media, this is more true than ever.
Nowadays, we’re all cynical about anyone who tries to sell us something. Salespeople get the door slammed in their face. Instead, we turn to our friends for advice.
Word of mouth is powerful because we trust our friends. Friends recommend things because they care for us and want to help us out, not because they’ll make a tidy profit if we listen to them.
What can you do to nudge your customers into spreading the word about your business to their friends?
How to Insult Your Customers (Don’t do this!)
The obvious solution is to give customers an incentive to recommend you. Paying for referrals seems like a no-brainer, until you look at what actually happens when you pay for recommendations.
Back in 2010, researchers at ETH Zurich looked into how people respond when companies offer incentives for recommendations on social media.
The research made two key findings:
- In many cases, offering an incentive makes your customers less likely to recommend your business, because they don’t want to be seen as making a quick buck from their friends.
- People are far less likely to trust recommendations from friends if they find out their friend is being paid.
As Alex Littlewood of ZuberRants explains, offering money for referrals is an insult to your customers. Alex writes:
“Your customers are not mercenaries for hire. And their friends and family aren’t chumps. Besides that, when someone gets referred by a person that’s being compensated, credibility and trust gets flushed down the toilet.”
What Really Works For Getting Recommendations?
If you can’t pay for customers, what can you do?
Offer a high level of customer service. Research by comScore in 2012 found four key factors in why customers recommend an online business to their friends. In their study:
- 65% of respondents had recommended a business because it offered free shipping. What’s more, 70% of consumers have added an item to their cart to qualify for free shipping. (On a related note, having no options for free shipping is the number one reason customers abandon their shopping carts).
- Four in ten (41%) respondents said they’d recommended a business after receiving their product when they expected.
- Nearly a third (29%) of customers recommended an online store because it had allowed them to return a product for free.
- A similar number (28%) cited easy returns and exchanges as a reason they’ve recommended a business.
Free shipping, keeping your promises on delivery times, and a hassle free returns procedure are the best ways to get your customers on your side. Offer all of these, and your customers will want to tell their friends about you, without you even asking.
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