More remodelers are launching referral programs for the first time, driven by slowing sales and rising marketing costs. While some programs result in spectacular awards (such as high-end vacations for multiple referrers), lesser rewards can step up first-person introductions as well.

Take Creative Contracting, of North Wales, Pa. Since publicizing its “Referral Rewards” program in March, the $3 million company has brought in more than 30 referrals and at least four signed contracts. The reward is the referrer’s choice of a $25 gift card, a $25 donation to their charity of choice, or an hour of handyman work.

“Historically, most of our referrals have come from past and current clients,” says Teresa Berger, marketing director. The rewards program, combined with “gentle reminders” to contacts, has reinforced top-of-mind awareness at a time when homeowners are more deliberative about whether to remodel and whom to hire.

The actual rewards are given only after an initial consultation indicates that the prospect is serious about hiring the company. “We want to encourage qualified referrals,” Berger says.

Tips for Success

Make it easy. Creative Contracting’s home page links directly to an easy-to-complete referral form, with a dropdown menu listing reward options.

Promote. Creative Contracting promotes its program in its e-newsletter and everyday conversations. Referrals can be a win-win, Berger says. “If trade partners refer work to us, it generally leads to more work for their business.” Consider rewarding employees for making referrals as well.

Tie to warranty calls. As part of its two-year warranty, Creative Contracting calls clients on the one- and two-year anniversaries of their project competition. The caller follows a basic “script” that mentions the referral program, after checking in to be sure that the project is holding up well.

Say thanks with a friendly note or phone call.

So far, the $25 gift card has been the most popular reward, Berger says, but fine-tuning continues to more successfully spread the good word. 

Relationship-based efforts such as open houses help Creative Contracting meet prospective clients through friends of the company.
courtesy Creative Contracting Relationship-based efforts such as open houses help Creative Contracting meet prospective clients through friends of the company.
courtesy Creative Contracting