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February 2011

Q and A: How to Set Up a Client-referral Program

 

referral

By CARRIE MYERS

Q: I’m thinking of starting a referral program for my clients and club members. Do you have any suggestions on how to set one up?

* The terms “client” and “member” are used interchangeably throughout this article.

A: A client-referral program can be one of your strongest sources for client retention, as well as for harnessing new clients*. A client-referral program rewards your current clients for recommending your services to other people.

“Regardless of how big or small a fitness facility [or business] is, the number one source of new clients is word-of-mouth referrals,” says Sherri McMillan, CEO of Northwest Personal Training in Vancouver, Wash., and Portland, Ore. “An effective and ongoing program is critical.”

How you set up your program will depend on what you feel would work best for your business. First, you need some method of tracking the referrals. Perhaps the simplest way of doing this is to have a space on the application where new clients can write in who referred them to you.

Another possibility is to use a client-referral form (such as the one featured in The ACE Fitness and Business Forms Handbook by Stephen J. Tharrett, M.S. where current clients give you names of potential new clients. Hopefully the current client has already laid the groundwork by offering praise for you and your services, but either way this provides you with the opportunity to contact these people about what you offer. Another benefit of this method is that it can help you build a database of names to better target various forms of advertising, as well as build a potential contact base for newsletters and other informative mailings. Remember, these contacts are all potential clients. Make your communication, whether calling, mailing or emailing, upbeat and positive, and be sure to tell them who it was that referred them to you.

Once you have identified your method of tracking referrals, you need to decide what you’re going to reward your clients with and on what conditions. Obviously you’re not going to reward a client simply for telling someone about you. Most facilities or independent contractors specify that the new client must purchase a minimum amount of services or membership level for a reward to be granted. At Northwest Personal Training, the minimum requirement is a six-session personal training package, and the reward is a free massage or personal-training session.

 “We did a survey and this is what clients wanted as the gift over a T-shirt, gym bag, etc. That’s why they work out with us, so it makes sense to gift them with what they really want,” explains McMillan.

Some facilities provide several options for members to extend their memberships through referrals. The Mount Wachusett Community College Fitness and Wellness Center in Gardner, Mass, incorporates several opportunities into their referral program. Every referral by an active member of the center that results in a newly paid membership (which they define as someone who has not been a member in the last 90 days) earns an extra week of membership. Their name also is entered into a monthly drawing for a month-long extension to their active membership. In addition, each referral is also eligible for a drawing on March 15 of each year for an annual membership. The member-referral form is posted on the center’s Web site, which new members can download, fill out, and have signed by their referring member.  

In addition to an on-going client- or member-referral program, you can also do special refer-a-friend promotions. These referral drives can motivate current clients to ultimately promote your business and generate new clients in a short amount of time. The Works Family Health and Fitness Center in Somersworth, N.H., for instance, holds an annual Fall Member Referral Contest. The member who refers the most people who end up joining wins the grand prize. For the fall 2010 contest, the grand prize was a HDTV and Blue-Ray player. There were also other prize levels that included smaller gifts, such as T-shirts, jackets and gym bags. Contests such as this provide you with an opportunity to collaborate with other businesses in your community, as they may be willing to provide a grand prize in exchange for the business promotion.

You can also incorporate gift certificates into your referral program. The client buying the gift certificate automatically qualifies for a client referral if the referral is not already an active client. Northwest Personal Training also puts a new spin on gift certificates—a sort of “try before you buy” deal.

“We regularly give out trial gift certificates to our current clients to give to their loved-ones,” explains McMillan. “These certificates are good toward an initial training session and two weeks of group classes.” 

Cathy Moxley, owner of Fitness InSight in Germantown, Md., offers frequent bring-a-friend-for-free promotions. To increase the fun factor, she designates each promotion with a different theme. “It might be bring-a-neighbor day, bring-a-coworker day, or bring a relative day,” she explains.

Of course, if your clients don’t know about your referral program, they won’t be as motivated to invite people.

“We promote our program with posters and fliers throughout the facility,” adds McMillan, “and also highlight it on our Web site and in our mass emails to clients.”

Be clear in your program promotions about any stipulations you have.

Your current clients are your best source of business advertising. Build off clients’ satisfaction with your services by inviting them to tell others about your business. In turn, reward them with something of value to motivate them to continue to renew their time with you, as well as bring new clients to you. A client-referral program is a cost-effective way to build your clientele, and should be a part of every fitness facility’s advertising campaign.  


carrie

Carrie Myers has a bachelor’s degree in exercise science and has been a freelance writer for more than 11 years. She is the author of the award-winning book, Squeezing Your Size 14 Self into a Size 6 World: A Real Woman's Guide to Food, Fitness, and Self-Acceptance and presents, teaches and trains in N.H. and Vt.

 


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