JohnAmardeil.com

There’s no denying it—referrals are great.

Picture Jim, a hardworking man so happy with the home he bought from you that he refers his close friend Matt to your company. Suddenly, Matt is more likely to buy from you. The reason?

According to Bing, Microsoft’s search engine, research indicates that “90% of people seek advice from family and friends as part of the decision making process. This ‘Friend Effect’ (…) often outweighs other facts because people feel more confident, smarter and safer with the wisdom of their trusted circle.”

Besides the “Friend Effect,” Matt now knows he’ll get a monetary reward for buying from you. His friend Jim will get one, too. What do you think will happen?

In many cases, what happens is you sell two homes, the second of which you didn’t have to market directly. No wonder most homebuilders and marketers have long offered referral programs.

There’s a problem, though. Not with referral programs themselves, but with the mechanism used to distribute and market them.

Currently, homebuyers are given a piece of paper with referral information. They’re thus expected not just to save that piece of paper, along with all their tax income files and love letters and scribbled recipes and faded receipts and insurance paperwork, but they’re also expected to retrieve it when they remember their friend who’s shopping for a home.

How many times do you think that piece of paper is lost? Used to dab spilled coffee? Used as scrap paper? Filed away, never to be seen again? And do you even know when all your friends are house hunting, or do you just find out once they’ve made the move?

This is what it comes down to: failure to innovate this dated mechanism is failure to sell more homes.

Simply put, we must make it easier for homebuyers to refer their friends to you. While we’re at it, we must transform referral programs so that homebuyers can refer many more friends.

The ideal means to achieve this, in my opinion, is Facebook. Facebook’s not only the world’s most visited website, but it has also joined forces with Bing, Microsoft’s search engine, so that Bing users can receive personalized search results based on the opinions of their Facebook friends. I expect this will increase visibility in SERPs (Search Engine Result Pages) for builders who are on Facebook.

With all this in mind, we created our new Facebook Homeowner Referral Program.

Here’s how it works: we add a tab to your corporate Facebook page, called “Referral Program.” (If you don’t have a Facebook page yet, we’ll be happy create one for you. And if you don’t have an existing Referral Program, we’ll gladly develop that too.) We advertise the Referral Program to your homebuyers so that they see how easy you make it for them to refer your communities to their friends in a way that makes it worth their while.

All your homeowners have to do is click a “Refer your friends!” button and an online referral form will automatically appear. The referred person prints the form and brings it to the presentation centre. (That will be the one time this program involves a paper form. And hey, if they forget, we have all the info electronically anyway.) Once they buy, both the referred and the referee get their rewards.

And all it took was a couple of mouse clicks.

But does it pay?

I’d argue many worldwide initiatives that have brought about a lot of good were financed or launched, at least to some extent, by private capital.

But did these initiatives make their managers any money?

We recently launched a contest for one of our clients, in support of an artistic community.

The project initially raised eyebrows. Why would a builder want to launch such an initiative? What was the connection?

But as participation increases, doubt is beginning to recede. Here’s what a participant emailed us yesterday:

“It worked!!! Thanks for all of your help.

I look forward to hearing all of the other contestants (…)

Thanks for giving local talent a venue to showcase their stuff. There are many talented people in our own backyard.”

Knowing that we’re helping people from a particular community gives us great pleasure. There’s more to it, though. Choosing to support a specific cause or community can help shape a brand’s image. And in our case, it’ll also help woo potential homeowners.

Companies of all kinds have always known that cause-related marketing creates goodwill with customers. (Interestingly, it also results in employee goodwill.) While a contest in support of an artistic community is not quite the same, I’d argue it can bring about similar benefits, even—or especially—for builders.

We must keep on finding novel ways to market for our clients. All the better if we support someone while we’re at it.