Up to now, much of the B2B industry’s knowledge about the effectiveness of referral marketing programs has been anecdotal. Granted, there are some great case studies, but there have been relatively few studies done on a referral marketing program’s potential impact on the bottom line at B2B companies.
In a recent webinar, Matt Heinz, President of Heinz Marketing, revealed key insights and useful strategies for B2B referrals from a comprehensive research survey conducted by Heinz Marketing and Influitive. For the research, Heinz Marketing surveyed over 600 professionals in B2B sales, marketing and leadership positions at a variety of companies.
Watch the webinar recording to learn why companies with formalized referral programs—led by the marketing department—generate better quality leads and have a stronger sales pipeline as a result.
1. Referrals are the best leads you can get
The majority of survey respondents found that referrals convert better, close faster and have a higher lifetime value than other types of leads.
Despite these stats, only one in three B2B organizations surveyed have a formalized referral program, and less than one quarter have programs managed by the marketing team, or supported by referral software.
2. Marketing-led customer referral programs are more likely to succeed
In the survey, respondents were asked if marketing, sales or another department was heading up their referral program. They were also asked how on track they were towards meeting their sales targets. The responses were definitive: companies where referral programs were managed by the marketing team were 3X more likely to hit their EOY revenue goals.
“When marketing is driving referral programs, they’re generating more referrals,” Matt says. “There’s more consistency in the execution and the results.”
3. Tools make referral programs more effective… but so does a referral strategy
Only 22% of respondents had a set of referral marketing tools in place. However, the research reveals that this small group was 3X more likely to accelerate the creation and conversion of referrals—leading to greater lead volume, lower marketing costs, and better sales forecasts. “There needs to be tools and systems in place to make it work and create consistent, repeatable results,” says Matt.
However, a lot of companies adopt tools before creating a clear marketing strategy for generating referrals. “I see plenty of sales teams that have referral tools, sales automation tools and messaging tools,” Matt shared. “But if they don’t have a strategy for usage behind it, they don’t deem it as valuable.”
The research discovered that 68% of reps with formal referral marketing strategy rated these tools as effective or highly effective, compared to 40% for those without a formal strategy. “When they have those programs along with the tools, the perception of value goes up. And the results go up significantly as well,” says Matt. It was also found that 45% of reps that have a referral program strategy expect their closed deals to increase within the next 12 months, while 47% of those without a formal process expect their sales to fall flat.
It’s clear that the existence of both referral tools and a formalized strategy makes a difference.
Creating a solid and reliable source of leads and sales via a formal referral program will improve your sales team’s effectiveness—and your company’s bottom line.