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A powerful and inexpensive way to get new customers is to harness the power of referral marketing. Referral marketing is a systematized approach that maximizes the power of word of mouth. Referral marketing asks, promotes, and rewards customers, suppliers, and other contacts for referring potential prospects to a company.Here are some specific tips on how to put referral marketing to best use:

1. Make it a condition of new customers doing business with you to provide referrals- One proven strategy for insuring an ongoing stream of referred leads is to make getting referrals a condition of new customers doing business with you. For example, you would explain to your new customers that rather than investing money in advertisiment you would rather invest in providing new products and services for your existing customers. That's why you have chosen to build your business by asking that all of your customers refer at least three prospective customers to you. When asking for this from new customers, you explain that you will not ask for these referrals until your new customers has been a customer of yours for 2 months- and you only would expect referrals if your new customer was totally satisfied with the service your company provides.

2. Prime the pump when asking for referrals- Rather than simply asking for referrals, you should describe to the referrer what an ideal prospect would be for you. For example, Do you know of any companies who have problems including (describe a problem your company can solve)?

3. Install an automated referral program on your web site-Install a script on your website where you offer a free gift to website visitors if they refer others to your company. The script provides a form for the website visitor to complete where names and email addressed can be entered. The program provides a place for the user to enter a message introducing your company and then sends an email address to all the names that are entered into the form.

4. Inform everyone that you build your business based on referrals. For example, a doctor placed a sign in his waiting room that reads We build our medical practice by other satisfied patients telling others about us. If you are happy with the care we provide, we would appreciate you referring others to us who need a doctor's help.

5. Exceed the expectations of your current customers. There is no better way and easier way to get referrals from your customers if they are more than satisfied with the products and services you provide.

6. Stay in constant touch with your current customers. In a recent survey by the Chamber of Commerce it was found that 85% of the reason customers left their current supplier was because of a perceived attitude of indifference. It is unreasonable to expect referrals from your customers if you don't stay in regular contact with them. Another secondary benefit of staying in touch with your current customers is that your customer attrition rate will decrease.
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