Referral Programs Give Customers a Reason to Return - Tire Review Magazine

Referral Programs Give Customers a Reason to Return

The worst number in marketing is one, and that’s because there’s no one single advertising magic bullet that will flood your showroom with red-hot leads ready to buy day after day.
The first - and perhaps most important - referral strategy is to incorporate incentives. If your customers are to get over the natural reluctance to refer, they need a little extra enticement, like free merchandise or a discount on tires or service.
Different people have different preferred methods of communication and therefore react differently to the constant influx of varied media coming their way. This is why diversity equals stability in the world of marketing, and you’d better be fishing with multiple poles in the water if you plan to maximize your monthly marketing budget.

There are cost-effective methods for marketing your dealership that are quite kind to your ad budget and get incredible, measurable results.

The quickest way to double your business would be to have every customer in your database refer you one new customer. Although referral systems as a marketing strategy are often overlooked and not taken seriously, they actually can be one of the most powerful new customer acquisition methods in your entire marketing tool box.

Considering that the influence of friends and family ranks high in the buyer’s decision to purchase, it makes sense to take a serious look at how you can create a referral culture in your tire dealership with a structured program integrated into your marketing mix.

Another compelling reason to focus on referrals is that the closing ratio and gross margin of a referral sale are proven to be significantly higher than ice cold walk-in visitors. This is because referrals come in the door with an associated level of trust. If my friend trusts this dealer and I trust my friend, then I too will trust this dealer.

Joe Girard is very familiar with using referrals as his primary marketing method. He became the Guinness Book of World Records world’s greatest salesman, selling 13,001 new vehicles at retail during his 15-year selling career, a record that still stands today.

Joe was a true professional at getting referrals from every customer. Joe’s theory is that if the average person knows 52 people who will show up for their wedding or funeral, then they must know at least one in the market for a new car. And there are many, many more drivers out there in need of new tires or automotive service than a new car.

So why don’t more dealers have a structured referral system? Many dealers have an underlying belief that satisfaction equals referrals. In other words, if I do a good job, my customers will send me business. However, high customer satisfaction typically isn’t enough to get customers to make a recommendation, as it’s natural for people to have a reluctance to refer. Why? The person they refer could have a bad experience, therefore making them look bad.

And of course, many, if not the majority, of dealers just have never been taught how to create and execute a referral system that gets measurable results and actually works.

The first and perhaps most important referral strategy is to incorporate incentives. No bait, no bite. If your customers are to get over the natural reluctance to refer, they need a little extra enticement, like a free t-shirt or $10 gift card to spend as they wish when they refer a friend or family member.

Money is the most powerful behavioral modification tool on the planet, and it’s amazing what people will do for something free. The use of premiums and incentives isn’t just for the person providing the referral. It has to be for the person receiving the referral as well, so they’ll take action and come to the store.

Timing is also critical. The law of reciprocation is simply that natural desire to do things for people that do things for us. The best time to ask for a referral is right after a customer does business with you. This can be done face-to-face, or by e-mail, phone or mail.

Another popular strategy is to implement referrals during open house-type events. When marketing your event to your house list, you can offer an incentive such as 10% off, and for those who bring a friend, both can get 15% off. If you look at the lifetime value of each of your customers, you’ll find that a little extra discount or a free t-shirt is a worthy investment to acquire a new customer.  

While creating a structured referral system isn’t a magic bullet, it is a viable marketing medium that can generate an exponential return on investment.

Looking for other ways to increase sales? Click here for more great articles.

You May Also Like

Consider Software Solutions to Streamline Operations

Representatives from several software providers share how solutions drive efficiency and profitability, as well as what to look for when considering a system in your shop.


When it comes to operating a successful tire dealership, software systems have become a necessity. Not only do they streamline the point-of-sale process and daily operations, but today’s software packages also offer solutions for customer communication, inventory, service writing and more.

We spoke with representatives from several software providers, who shared how these solutions drive efficiency and profitability, as well as what to look for when considering a system for your shop.

How Data, Analytics Can Boost Profitability for Tire Retailers

By collecting and analyzing data about a dealer’s sales history, inventory levels and market demand, data and analytics platforms can analyze the performance of each dealer’s store and recommend actionable improvement opportunities.

How to Start the PPP Loan Payback Process

For many PPP loan recipients, it is time to start the repayment process—or file for PPP loan forgiveness. Read on to find out which portion of your loan may be forgivable and how to apply for forgiveness, as well as how to start the repayment process.

Creating a Positive Work Environment

Larry Sutton of RNR Tire Express shares seven different practices that have helped him create a positive work environment.

Using Data to Enrich the Customer Experience

Attaching data or a number to a vehicle’s service record adds a level of transparency to the discussion, and moves it from an “opinionated upsell” to a true, fact-based service need.

Coats Tread Depth Data

Other Posts

Matching Your Customers with the Best Touring Tire

Picture this: You’ve prepared your list of symptoms and questions to ask the doc, but when the time comes to see them, they don’t seem to want to get to the bottom of your issues. Instead, they send you home with a prescription you’ve never heard of before. Related Articles – Speed Ratings and Changing

Consumer Survey Shows Greater Trust in Service Professionals

In a survey conducted for the National Institute for Automotive Service Excellence (ASE), automotive service providers have gained more trust and respect among the motoring public than in recent years. The ASE says b4 Branding surveyed almost 1,500 vehicle owners across the country and over 70% reported increased levels of trust in manufacturers, dealerships, independent

ASE World Class technician auto care association
Big O Tires Exec. Interview: Nationwide Expansion on Horizon

Do you realize how hard it is to win three straight championships in a row in professional sports? The last time it was done was all the way back in 2002. The Los Angeles Lakers – stacked with Kobe Bryant and Shaq in their prime and Hall of Fame coach Phil Jackson – won three

TBC Big O Tires Bourrut-Maciak-Bull-
AMN Drivetime Chats with NTN’s Charles Harris [Video]

A native of “Honeymoon City” Niagara Falls, New York, Charles Harris began his aftermarket career after graduating with degrees in both Business and Marketing from Northwood University in Midland, Michigan. An experienced sales executive, Harris has spent more than 30 years in the automotive aftermarket, holding executive management roles at such well-known names as Tenneco,