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Recommendations, referrals, word of mouth marketing, social referrals; read any marketing publication and you are likely to find these phrases in abundance. In the age of social media and websites that host peer reviews such as Yelp, consumer to consumer, or C2C recommendations and reviews, are the new reality for businesses. Exposure to this phenomenon is beyond your control; however, capitalizing on the trend is not. If you haven’t considered a formal referral program for membership acquisition, read on. If you have a program already, pat yourself on the back for being ahead of the curve, but read on anyway, because you might be able to improve your program.

Credit unions, by nature of how they do business, are highly referable. They are for the people, by the people, and generally have heavy community involvement. Credit unions have some of the highest net promoter scores of any industry, which evaluates businesses on how referable their product or service is. Great customer service is a benchmark of credit unions, but the value goes beyond loyalty and retention. Recommendations are happening right now, the question is, are you tracking them and facilitating more of them through a formal program and reward system?

When you think about a referral program, reference any loyalty program you participate in. Major brands figured out they could better understand customer behavior and facilitate greater loyalty and more purchases by motivating their customers to identify themselves when they make purchases. How did they motivate customers to sign up, carry a card and present it at purchase? Through brand-specific rewards, of course. A referral program is virtually identical in nature. Referrals are channeled through a program that you setup, and members are motivated to do so through a reward offering. Speaking from experience, you will be quite surprised at the results.

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