Direct Buy Marketing Analysis

Referral Program

Learning how new clients find out about your company is an important component of a marketing program. Referrals are one of the best ways to gain new clients and one of the least expensive ways to do it. Referral systems are critical for success of a company and are undeniably a successful form of advertising. Referrals require less money than major marketing campaigns and have the potential to drive in quality prospects.

Referral programs can be subtle or can be overt. A subtle referral program is a reminder program where the company consistently reminds the client about the company through subtle means like a refrigerator magnet, stickers, chip clip, e-mails, newsletters and direct mailings with the hope that when the need arises they go to the magnet, chip clip or sticker with your telephone number and call. In an overt referral program, the company consciously tell the clients that they have a referral program, what that program is, how they can participate and what they can expect from it. These programs usually offer rewards such as gift certificates or cash in return.

Here we are proposing an overt referral program for DirectBuy which is similar to the customer referral program. In this program, realtor agents hand out brochures of DirectBuy to the new home buyers on the day of closing of the house. Contractors would be excellent contributors to the referral program, given the nature of their job. We feel that interiors designers should also be approached for this program, as they work with DirectBuy’s key demographic, women. After looking at the DirecBuy information packet and following up on the open house, if the referee decides to enroll for the DirectBuy membership, the associate gets the referral fee of $250 cash from DirectBuy. This is essentially taking the existing customer referral program that is already in place, but extending who has the ability to take advantage of the program. With this program, DirectBuy does not incur any upfront cost except for the cost of printing the leaflets. This would be a very good program since DirectBuy will be able to target all the new home buyer’s market and current home owners who are renovating, without having to perform much market research. Since new home buyers and those renovating are the potential customers who would be interested in buying home furniture, home improvements and furnishing products, this program would bring more foot traffic into the door and ultimately more memberships for DirectBuy.

Survey:

As a follow up of the program and to identify if the program would work or not, we did a survey by contacting different realtor agents from different realtor companies in Memphis, TN to see if they would be willing to participate in a referral program mentioned above. Each realtor agent was asked four questions which are as follows:

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