Positive Word of Mouth (WOM) is an intention of every business in the world. Market Research companies invest significant time and resources in their Customer Referral Program (CRP) to spread the word for their services. But there are reasons why their success rate falls below the market standard and fails to comprehend the strategy. Are there more avenues to look at? Let’s explore
Market research is a base function of every business that exists. Market Research companies provide something that every other business needs – data collection and analysis, to determine the viability of a new product or service.
Approximately, there are 5,400 establishments in the United States that offer market research services in single as well as multiple locations in the country. The number dictates the level of competition in the industry and a need to have a successful customer acquisition strategy.
This digital and social media age has made it easier for businesses to find their potential customers. Market researchers are no exception to this trend. Other than this, the B2B industry can acquire new customers using existing contacts, networking, and new prospecting.
Before MR firms can research for their clients & client’s potential customers, they need to run through the research process for themselves too, for making new business connections. One of the ways that these firms adopt is the Customer Referral Program.
Customer Referral Program is an incentive-based version of Word-of-Mouth marketing, where you encourage your existing customers to refer your services to their friends & acquaintances, in return for compensation or other benefits. The company can run a public referral program by listing it on their website & promoting it through social media or can keep it more personal for sharing it with its customers only.
Challenges of a Customer Referral Program in the Market Research Industry.
A successful global average referral rate is about 2.3%. Although the exact number varies among various industries, it revolves around the same figure.
Look at it from a different angle; around 20-50% of purchase decisions are a result of WOM. This gets your referrers, a.k.a your brand’s advocates under the spotlight.
Is that it? Do you just need loyal referrers to promote your Market Research services? Maybe not.
- It will not be easy for your MR customer to guess if other businesses need the service of a market researcher. Consequently, it will take a lot of convincing skills to articulate how a particular market research company can help others in getting desired results.
- The existing customers may have results specific to their business, which may or may not agree with others.
- If your MR firm is niche-focused, your existing customers may not refer other businesses from their domain, out of sheer competition.
- The referral program sometimes fails to get quality leads. An easy incentive policy may be the culprit here. The customer gets more focused on quantity rather than quality.
- On the other hand, a complex incentive policy might scare away the referrer and lead him to get disengaged with the whole referral program.
- Even if there exists an optimum referral policy, people refrain from referring, to avoid being a middleman, especially in case of a poor association of referred customer and the MR firm.
- Last, but not least, is the referral program generating profit, or is the acquisition cost soaring up?
So, shall we look for other avenues too?
Alternative to Referral Program for customer leads
The ulterior motive of a market research firm is, of course, new business connections.
When MR companies look for an external source for generating leads, the major focus should lie on the people or businesses that understand this industry well enough to promote it to the right set of audiences.
The right business development outsourcing company can be a great alternative to your customer referral program. This business domain is usually led by market research experts, who know the industry to its precision.
These businesses have greater market penetration & build high-level customer relationships. Hence, they can act as an extension to your Market Research marketing team. Their services range from basic lead generation to customized business development strategies.
An outsourcing company that focuses majorly on the market research industry, is the most preferable choice, especially for the start-up MR firms.
Conclusion
Networking is the key here. The larger the network, the greater is the guarantee of better market penetration. Harness the power of professional networking sites like LinkedIn, Meetup, Opportunity, etc. Get external companies on board to help you in your quest for value-adding customers. Dive in the ocean of opportunities and make a recognizable brand.
