More on referrals

In my last posting I discussed in detail why you should be asking for point of sale referrals and I outlined some of the components you need for a good system. I got a follow up question from one of the readers so I thought I’d flesh this topic out a bit more since it is so important.

The question was, “How can I get more new members to give us names at the enrollment process; we get a lot of people saying, “I can’t think of anyone right now.” This is a good question and one I hear often. So, let’s take it step by step.

Remember I mentioned in the last posting that there were three elements you needed for a good referral program? Those were value, scarcity and urgency.

If you want more new members to feel compelled to participate in your point of sale referral program you MUST have all three elements in the campaign. Here’s how you do it.

Value. If a person doesn’t see the value of doing something for them they simply won’t do it. Therefore, in order to create value in a point of sale referral presentation you must be able to show the customer that it is worth their time and effort. One way you can do this is by “bribing” them with some sort of gift. Inexpensive $5 T-shirts work great and so long as you’re getting at least 3 qualified names AND your sales team is following up on those names, this is a cheap lead.

Another way to create value is through contrast. That is, showing the new member that a visit or a pass to the facility is usually X dollars and by giving you the names today they get the passes for free. This strategy only works if your club has some control on guest policies—i.e. if you give out one week passes like candy, don’t think a one week pass at the point of sale with motivate someone!

Scarcity is next. Scarcity is really nothing more than a driver to create more value. When something is limited consumers perceive a higher value. Therefore, whatever your point of sale referral promotion is going to be, make sure the new member gets a limited number of the opportunities. So, if you are giving them one-week passes, limit it to three or four.

Urgency is last. Urgency is probably the answer to Bob’s question. Most clubs have some level of value in their point of sale referral program but they do not put any sense of urgency on the new member because they are fearful of upsetting them. This is unfounded. People understand and appreciate bargains and deadlines and limits. They may not like them but they understand them.

Therefore your POS referral presentation must be available ONLY at the point of sale, end of subject. If the new member chooses not to take advantage of the program then a manager should be the one to follow up with either a phone call or e-mail to try and take one more bite at the apple—i.e. use their authority and curiosity to say, “Gee, I noticed you didn’t take advantage of those passes. May I ask did Casey fully explain them to you and their value?” You would be amazed at home many new members have a change of heart when this type of follow up happens. It is also interesting to see how much better salespeople get at their presentation when they know they could potentially lose those referrals!

By making sure your point of sale program and presentation has value, scarcity and urgency you will be able to generate more referrals at the time of enrollment.

SPEAKING OF URGENCY

There is only one spot left in the e-marketing course that starts this Thursday, May 29th.

If you want to learn how to use the Internet to drive more prospects through your club doors, go to www.SmartClubMarketing.com/techclass.

In good health, Casey