How an Awesome Customer Experience Can Drive Referrals

How an Awesome Customer Experience Can Drive Referrals

Building a successful business entails more than just a solid advertising plan and a quality product that sells. Winning brands also zone in on the customer experience involved with each transaction.


Why Customer Experience Matters

Why focus on customer experience and not on marketing campaigns or product quality? A closer inspection proves improvements in customer experience are tied to revenue growth. In fact, studies show that 86 percent of customers are willing to pay more just to receive a better customer experience.

Revenue increase from moderate improvements in customer experience

Fig. 1. Revenue increase from moderate improvements in customer experience
(Source: Temkin Group)

According to a study from the Temkin Group, even a moderate improvement in customer experience delivery can drastically increase annual revenues by 82 percent. All figures point to the fact that enhancing your customer service experience affects brand reputation and growth.

A business is built on the foundation of providing value to customers and earning profits in return. But in between these two factors lies the customer experience, which ties both ends together to create a complete circle that businesses can tap into repeatedly.

Did you know that referrals are more cost-effective to acquire and have a better chance of becoming loyal customers than people who were not referred to your brand? The cost of acquiring new customers is seven times more expensive than retaining an existing client. In addition, it is more profitable to convert an existing customer into a loyal one than find a new customer to give your brand a try.

Percentage of customers who are willing to make referrals

Fig. 2. Percentage of customers who are willing to make referrals
(Source: Ambassador)

Studies show that 82 percent of Americans follow the recommendations of their families and friends when making a purchase.

Many businesses believe word-of-mouth marketing only happens by chance. This makes them oblivious to the fact that referrals can be controlled and used in their favor. Word of mouth is a powerful marketing tool that can help promote your brand without having to spend too much on advertising. The customers themselves will take the initiative to help build your brand image while you can focus your efforts on other aspects that will do the same.

Providing a satisfying customer experience not only drives loyalty but also referrals through word-of-mouth recommendations. Satisfied customers also tend to provide good reviews that can encourage more customers to try your brand for themselves to get the same positive experience.


Ways to Improve Customer Experience

Referrals are driven by positive customer service experience, which is why it’s vital to improve your CX while maintaining high-quality offers.

Here are the steps you can apply to your business to help drive more referrals.

1. Internalize your customer experience.

Customer experience doesn’t just happen at random as if it’s not within your control. It can be designed and managed in order to produce your desired outcome.

However, you can’t expect to have employees prioritize customer experience if management doesn’t first set the tone and model a customer-centric approach. Employees will follow suit when they see that the business is really intent on improving its retail customer experience.

2. Exceed customer expectations.

Going the extra mile will set you apart from the competition. Customers will always remember little details that show your brand goes above and beyond standard procedures.

 Customers have expectations of what your brand can deliver. Meeting these expectations will earn you their trust, but going beyond your targets will earn you their devotion.

One brand known for doing more than expected is Zappos, an online shoe retailer. When they ran out of stock of a certain pair of shoes, they purchased the pair from a rival shoe store and delivered it to the customer personally. Word-of-mouth helped spread this story and gained many new customers for the company, so much so that they were valued at more than a billion dollars when Amazon bought them.

What does this look like for your brand? What gaps can you fill to go the extra mile for your customers?

Related articles:
Creating Better and Longer Lasting Relationships with Customers
6 Tips to Keep Selling to Your Existing Customers
Retaining Customer Trust by Keeping Brand Promises

3. Make it easy for customers to refer you.

Your product and service may be of top quality, but part of providing an unforgettable customer experience is to reduce consumer frustration by offering ample opportunities to get in touch with you quickly.

Make sure your website is mobile-friendly. Enable chat options for quick interaction. Be present on social media. Make communication lines open 24/7. If possible, offer omni-channel customer service for an even more seamless interaction.

There are many ways to make it easier for customers to communicate with your brand. Just make sure that whatever methods you employ, you provide customers with a consistent and quality experience.

4. Incentivize customer referrals.

While it’s great to have organic referrals, it’s not always the best option in highly competitive markets. Gain the upper hand by incentivizing customer referrals to help drive more sales.

Imagine you are your company’s customer. When asked about a specific purchase, you’ll gladly refer your favorite brands. However, if it weren’t for that direct ask, it’s easy to let purchases slip your mind and you likely forget to tell your friends and family members about it. Nonetheless, if your favorite brand were to go the extra mile and offer a discount on your next purchase for a successful referral, wouldn’t you be more likely to remember to refer that brand to a friend?

In addition, if someone refers you to a new brand, you’ll likely consider giving it a try. And if you know you’ll receive a discount or something in return just by giving that brand a chance, you’ll be even more motivated to buy it.

As a business whose objective is to provide the best customer service experience possible, having a referral program that incentivizes both new and current customers is a sound plan.

Start by giving a discount on the first purchase a new customer makes. As a reward to the one who referred him/her, you can give out a discount card or store credit as well. With this strategy in place, not only will you gain new customers, but you will also strengthen your relationships with existing ones.



Word-of-mouth referrals are powerful tools in gaining new customers and showing them what your brand has to offer. At the same time, providing a positive customer experience to existing consumers allows you to gradually increase their loyalty and indirectly enlist them as brand ambassadors who are likely to promote your business.

How else would you improve retail customer experience if not by understanding their needs and preferences and seeing your brand at the level of your customers? With the help of SeeLevel HX’s mystery shopping services, you’ll discover how your brand is doing from a customer’s perspective. Secret shopping will then help you identify strengths and drive referrals. Our team of customer experience specialists can also help improve existing strategies to increase business profitability through additional referrals and brand loyalty programs.

If you’re ready to capitalize on referrals by providing an enhanced customer service experience, contact us to schedule a free consultation. We look forward to speaking with you soon.