A referral programme is a system by which a company encourages existing customers and partners to recommend it further, and rewards them for doing so. Most companies rely on referrals happening by themselves – they do happen, but far less than they could, because a satisfied client simply has no reason to think of it at exactly the moment someone asks. A programme changes this by actively informing people about the option to refer and giving it a simple form. The reward does not have to be financial: a discount on the next order, an extra service, or priority scheduling often work better in B2B and do not create the impression of purchased references. Set clear rules for when entitlement arises, and reward both sides. With commission, bear in mind that it is a taxable supply and must be backed by a document.
See also: Customer retention, NPS – Net Promoter Score, Tax deductibility of advertising costs.
