Referral Strategies: Effective Tactics to Get Free Customers

Asking for referrals can increase sales by 30%, benefitting businesses of all sizes, without incurring extra costs.

### 7 Obscenely Easy Ways to Get Customers for Free
* 🎯 Referrals are crucial as they buy at **higher percentages, prices, and frequency**, and are **more likely to refer others**.
* 💳 The "Gift Card Play" involves offering gift cards at a **90%+ discount** to existing customers, who can only give them to others for a **limited time**.
* 🤝 When a customer asks for a discount, respond by asking them to **introduce you to three friends instead**.
* 🎉 Use the **"Referral at Success"** strategy to ask for referrals when customers experience a **positive outcome**.
* 📝 Pair handwritten cards with in-person events and encourage customers to **bring friends** by texting a picture of the invitation.
* 👫 Implement a "**Spouse Request**" strategy by proactively suggesting that customers **involve their spouses** in the service.
* 📢 In all messaging and marketing campaigns, promote the idea of **bringing a friend**, emphasizing the **benefits of doing so**.

I'm going to give you seven obscenely easy ways to get customers for free that you can implement within this week. These tactics have made me millions of dollars. They actually work, and I'll give you the real stats that I got when I used them in my business so you can use them in yours. You should be obsessed with getting referrals, and here's why: referrals buy at higher percentages, at higher prices, they buy more often, they buy more times, and they're the most likely customer to yes refer you more customers. And so, if you have two types of customers that you can potentially get, one that cost you a lot of money and does none of these things, and one that's free that does all of those things, which would you prefer? Well, obviously this one. And independent of how big your business gets, 30% of your business coming from referrals, no matter you're at 100 million or 100,000 a year, still grows your business by 30%. And when it's that big and it's still free, that's the type

of stuff that compounds a business into Infinity versus having one that plateaus because not enough people tell other people about it. So the first one is when I looked at one of our portfolio companies, we had a new sales gu who came in and crushed all of the records that had ever been done on that sales team. And it was a very experienced sales team, and I was like, what is this guy doing? Does he have higher close rates on the phone? And he didn't have higher close rates, but for some reason, he was able to get 30 to 50% more sales than everybody else. I was like, okay, so how is he getting more opportunities? And so we got on the call, we listened to all the scripts, we're like, he's not doing anything different. And so we pulled the guy up, we were like, dude, what are you doing? And he said, I don't know. Um, after I close the customer, I just say, who else do you know who might also want this? And I usually get like one out of three.

people to send me one or two other people, and I just do that on every sale 'cause I learned that uh in my last job. And when he said that, it was like this big obvious duh that I'm sure was in the SOP at some point for the sales team. And of course, people get lazy because they don't want to scare the sale away. But by simply saying, Hey, who else? Very clear. Who else do you know? Not, Do you know anybody? Yes, no. It's, Who else do you know? Who do you think would benefit from this? Who you'd want to do this with? Right? 'Cause now you're actually asking them to solve a problem with their brain, not make a quick yes-no answer, which is what most people are just going to say, No, I don't know anybody. Let's move on. And number one, this isn't going to be your grandmother's, you know, referral video on, Hey, you should ask for referrals. I'm going to give you some very specific strategies on what to do, how to say it.

in a way that'll actually get the likelihood that they do it pretty high. Now, referrals are super valuable for a number of reasons. One is that they compound with the business, meaning whether you're a $100 million business, 30% on 100 million, or 30% on 100 grand, is still going to be 30%. And so, it's one of the most scalable ways to grow business overall. The biggest companies in the world, the vast majority of what they get is from word of mouth, it's from people telling other people. And in today's society where people are more able to share things faster and bigger across broader audiences and networks, it matters more than ever. It's so funny because people are like, Man, why are my ads they were working, now they're not? Everybody believes in positive word of mouth, they don't believe in negative word of mouth, but both word of mouth happen because that's how this works. Number two, referrals who come in are more likely to buy, so they have a higher

close rate they pay more they're willing they're more likely to buy buy a more premium version of what you have. And they're also more likely to refer other customers. So you get three spins on the money-making wheel from having referrals versus a cold customer. So if you have let's say a recurring membership business that you have 10% monthly turn. Well you can obviously always keep trying to decrease that turn. But one of the other things that will always come out at any level. So if you have a th customer you can you turn 10%. You need a 100 new customers just to break even. One of the very smart things that business owners do is they say okay well if I can get 10% of my customers to refer someone every month then I can offset that churn so that my business is stable. And so by having a consistent way to get your all your customers to refer you 10% you can make up for the 10% turn that you have. And the ratio between your referral percentage and your turn percentage is

you're going to be your stable at rest growth rate, and so if you could have even 20% referrals on 10%, then it means you're going to grow two to one, and you will keep growing 2 to one no matter how big you get. Number one, this is called the gift card play. So I use this during the holiday season. So either you make up a holiday, it's like hey, it's my birthday, it's my wife's birthday, it's the anniversary of the business, or you go with the standard holidays, it's Christmas, it's Easter, it's, you know, you can make it a spring thing. It doesn't really matter, you just have to a reason why to do the gift cards. Now what you do with the gift cards, it works especially well at Christmas, is that you say that they are gifts for other people. So you offer to your membership base, and here's how it works, is that you want the amount for the gift card to be equal to one of your core unit of

service is something that you would normally give away for free. So if you were an SEO agency, you might have a $2,000 month service. Okay, then it would be $2,000. Is what the gift card would be. Now you're like, wait, $2,000 gift credit. Yes, this is why it's so compelling. If you had a, you know, a garage door fixing business and there's three elements to your service, you'd make it the base level. The cheapest level is what the gift card would be equivalent to. So let's say you have up to $1,000 of stuff and the lowest thing is 200 bucks. Then you make the gift card one or $200. Now that step one is what you price the value of the discount. The gift card at the second element is what you make the discount for. And the discount you want to be as aggressive as possible. And so I recommend 90% or more discount on this. So if I have a $2,000 thing, 90% discount is 200 bucks. You're

like wait, I'm not going to make money on this. Hold on. The point here is what would you already give away for free in terms of service or product in order to get in your customer? Probably a lot, especially if you know that a referral is worth a lot of money. And this is where it gets, this is where the money, this is where it gets magical. Okay, is that what you do is you say, Hey, I'm going to be giving these gift cards away only to my existing customers, and you can only give them to other people for the holiday season. Now, I'm going to limit them. This is a key point, limit two per customer, because that also gets everyone to buy two so that they refer you to customers, and so that customer now buys two 90% off coupons that they have to give to two individual people that they can't use on themselves. And when they make the purchase, you say, Who are you want me to make this gift card out to? And guess what happens there by making the gift card out to somebody you

also capture the lead, and so you get two referral leads that you get paid for. This is what I'm saying: you get paid for the referral lead. Everybody else, you have to pay money to get leads. Here, you get paid to get leads, all right? Big difference here. So, whatever. If you want to get really nuanced about it, you could just make it your cost to acquire customer. But I think it's far more compelling to make it whatever your base unit is, with the assumption that you know that you're going to be able to bring this person in and then upsell for the levels of service and then use that gift card against that. And so, obviously, we ran this in the brick and mortar gym space, which is where I started, and so we would run, say, a $200 gift card, which is about a month, and you get 90% off. So, that people would pay 20 bucks for a $200 gift card, and now they look like amazing family members. They're like, Hey, I gave you a $200 gift card, and you $200 gift.

card to my gym. The person comes in with the card because you have their number, so you can text them and follow up. And then you put an expiration date on the gift card. This is very important. The expiration on the gift card needs to be 30 days because you want them to use it as fast as possible. This is a year-long thing. You need to put urgency to get the lead in the door. So then you follow up and say, Hey, Sandra G, I gave you that gift card. Let's get you in here. And then when they come in, you have that $200 thing at the base level. You give the free month that you'd be happy to do anyways. And you get their card, right, their credit card. Or you can take that and say, Hey, I think you'd be best suited for the $2,000 package. I'm going to take the $200, put it against that. And boom, now I took my $200 gift card, put it against something that's 10 times more expensive. They got 10 really 10% off.

I still got paid 20 bucks for the lead, and to make the sale, and think about the math here. So like, if you have a big customer base and you sell two per customer, and you have, call it, 200 customers in your base, uh, and you get, you know, 30 of them to buy two cards each, that's 60 cards that you give out. And you're going to convert a huge percentage of those cards, so you bring 50 of those 60 in the door, and you're going to close a big chunk of those people. And depending on the price point, multiply that by your price, take out the discount, there you go. So you don't lose money for three reasons. One, you're not paying cost to acquire the customer. Two, the amount that the thing that you're giving away as a discount is something you should be comfortable giving away, that you would normally give away as a lead magnet or a free level of service just to customer anyways. And so when you have a normal way to get a customer.

usually have some sort of promo, and you have a cost to display that promo to people in terms of advertising. You pay neither of those costs, and then you make money because you're still getting paid by the customer to get the gift card. And then the third way that you can offset this is that you can still sell them into something that's far more expensive. And so at the very worst case scenario, you make a little bit of money on the discounted cash to give away an a level of service that you're comfortable giving away anyways. So the second one is super tactical, and it's a very specific point in the sales process. And so when someone comes up to you and says, Hey, I want to buy these Services, can you give me a discount? We've all heard this, Hey, can you make it a little less? Hey, can you give me a homie hooko? Hey, I know somebody, do you think you could uh, blah, blah, blah, blah? Right? So you say, Sure, I'd love to, just give me the name of three.

friends, and I'm happy to give you the discount. And so by doing that, you can immediately say, like, because what happens, they walk into a trap because they're going to, like, lean in as soon as you say, Oh, I can totally give you that discount. Just give me the name of three friends. And then all of a sudden, they're like, Oh, it's like, yeah, I will happily do that if you do something for me. And be amazed at how many times that actually works. I'm like, Oh, so if you just want me to introduce you to three friends for your service or whatever, you'll give me this discount? I say, Sure, but we do that right now. And you got to make the introduction. And so by doing that, you lock in three leads. They get the discount that you might have been willing to give before. I personally never discount unless there's a change in terms. And so either I change what I sell, or they have to do something for me. And so this is the second way, which is they basically do some average.

iing on my behalf. And so, in exchange, I give them the discount because I'm paying. That discount is my cost to get those leads, which I'm willing to pay for. If someone's asking for a discount, I mean, again, everything's going to come down to what is your cost to acquire a customer normally. And so, if I figure I'm going to convert one out of these three referrals, then I would say 1/3 of CAC times three. So, 1X CAC, your cost to acquire a customer, whatever it normally is, is what I'd be willing to give as a discount on the main thing. And as you become more experienced with this, you start to get more and more predictable metrics. And in the beginning, I just want this to work. You can start fine-tuning, Hey, I'll give you a 100 bucks per referral, or whatever. Now, the second way that you can do this is that instead of offering the discount, you can offer more service that's an equivalent amount. And the reason you do that is because let's

say I charge $200 for my thing, and it actually cost me $40 to deliver. If someone says, Hey, can I get a $200 discount? I say, I'll do you one better. I'll give you $400 of service for free if you send me the person. Now, the $400 of service to me only cost me $80, but the perceived value of the $400 of service actually makes it an even bigger discount for them to get the thing and send me the traffic. So, it's the second version, kind of 2A and 2B, of that second strategy. And if you want to hear how to take the referral process I just outlined and put it on steroids, I have a course that goes with this book. It's free. Come down. That's on my site at acquisition.com. You can click the leads course. You don't even have to opt in for it and just go to the Affiliates chapter. It's a 45-minute video, I think, that breaks down everything that you

can do to get more customers by partnering with people who send you customers on a regular basis. And number three is actually a permutation of number two, but just done instead of on the discount, you do it on the positive. You say, Hey, so you ask for $100 discount, how about I do you one better? I'll give you $200 of extra stuff. And the reason I'm willing to do that as a business owner, you don't say this, this me explaining to you, the $200 of service or stuff might cost me 40 bucks, whereas giving $200 off the price is going to cost me hard cost $200. And so I'd rather give you $400 of value for 40 or 80 bucks of cost. So actually reduce what my effective discount is, but I also increase the value for the Prospect. And one of the nice valuable things here is that you're just encouraging a customer to use your service more or use your product more, which is always a good thing. And the fourth version of this is one that I used all the time and it

crushed for me. And so what I did was, as soon as the sale was over, I would say, Hey, do you to know how you can get this stuff for free? And every time I did this when we'd have our sales, 30% of our sales for every one of our promotions would come from people using the word of mouth, the referral strategy that I'm about to talk talk about, all right? So it works really well. And so at the end of the sale, they already got you, already got the card, they already signed up, and you say, Hey, by the way, do you know how to get this for free? Everyone leans in, they're like, Yeah, of course I want to learn how to get it for free. So now we're not talking about discounts, we're talking about how do I get it free. And so what you say is, Hey, if this thing's 500 bucks, you say for every person you bring in, I'll give you a 100 bucks in cash. And it was a real $100 cash check that I would give these people. And so I

had so many people. I had nurses or teachers who had networks of people that they worked with on a regular basis and said, Hey, you want to do this weight loss challenge with me or whatever it was. And so I would have one girl come refer me 10 people, make 500 bucks, and I would get 10 customers from this one person. Now that was obviously on the sale, not on them making the introductions. That was the big difference between the first two and this one. I would say it was only after the fact, after the sale, that they'd be able to get the 100 bucks. But that slayed for me. I've tactically executed this two different ways in my career. Way number one is that underneath of my contract, I had all the names of the referrals always listed out there, and that would remind me and my sales guys to ask for that referral and also know that that person would be attributed back to that customer. Remember, I came from, you know, analog brick-and-mortar. I printed out contracts.

okay, the second way is to just do the digital way, which is Hey, introduce me right now with your friend, which I'll show you the real tactic on that in one of the future ones because it's really good, which leads me to number five, which is referral at success. And so, the moment that someone has some big thing, you just finished painting their house, or you put their garage door in, or you train their dog, or you help them lose weight, there's a moment of transformation that you have, and a lot of times that's where you capture testimonials. Now, for sure, capture the testimonial, but right afterwards, they're amped, they're feeling good, they love your service, they just experienced it. When you say, Hey, you're amazing, how many other amazing people like you do you know? And usually, they're like, I don't know, and then they start giggling, whatever, and you're like, Awesome, can we take a picture together to commemorate the moment? And then they say yes, it's like, Let me give your phone.

so you take their phone. You do a selfie and say, Hey, let's take this picture. Who do you know that we can send this to, that we can invite them in so we can do this with them? And by making that ask, and you do it from their phone, you text yourself through their phone with the picture of you, the outcome, and them. So if it's you and the dog, or you and the garage, or just you and them skinny, right? You text them and say, Hey, this is Sandra. You should meet Alex. And I used to joke around and be like, Alex is the coolest guy of all time. He's the most amazing man. You should to CU. Like they knew that I was texting as them, um, and they would get a laugh out of it. And so, mind you, this is where you have to have rapport with a customer. If you don't have rapport, then this isn't going to work. But for me, this is why having it at the success moment, it's like you've literally demonstrated the result in.

front of you to someone they know, and then that person is making the introduction being like, Dude, you've got to check this place out, it's awesome. They have the best crepes, or, They have the, they totally fixed my garage, and you said you were, you were looking at fixing it, look how nice mine looks, whatever it is. And that worked amazingly well to get referrals at the point of success. And so you'll notice the through line here is that at each of these moments, if someone asks for a discount, boom, you can get a referral. If you want to get a referral, you can add in a bonus, or you can flip the discount into a bonus. You can just ask them on a regular basis, Hey, how do you want to know how to get this for free? Which, slay for me, you can do the version here we're at the point of success, you take the picture and you do the three-way introduction. All these versions work obscenely well, no matter how big your business is, to get more customers in the

door. Let's get the next one. If you're watching on YouTube, tell me which of the seven you're actually going to do. Not what you think would be cool or what you thought was neat. Which one can you do and implement in the next 30 days? Number six. The next one is a handwritten card strategy. So here's how it works. You pair handwritten cards with in-person events or virtual events, but it works especially well for in-person events. And so if you have a member appreciation event or some sort of workshop or something that you're going to be holding on a quarterly basis or whatever cadence you have on, I'd recommend doing this at least quarterly if you have especially a local business. And so you invite the customers in, and it doesn't have to be high budget. It's just supposed to have some fun, have some food. It can be a potluck, whatever. And so you invite all the customers there, and the way you do that is you write a handwritten card thanking them for their patronage and saying this is your

invitation. You're cordially invited to the quarterly or semi-annual, uh, you know, Painters R Us event. Whatever, right? And so you invite them to this event for you to appreciate them. Now, you say, P.S. This is key. P.S. On the letter, you say if you take a screen, screen, if you take a picture of this letter and you text it to a friend of yours, they can use that to get into the event. They can have all the food and all the drink they want, and they can come with you. And if you want, just so that I know them before they come in the door, just do a three-way text with me and you can send that invite like you're sending it to them. And by doing that, you can collect a bunch of leads. And you say, Hey, it's also all people are welcome. And so they can then bring other people with them to your event. And when we would do this, you get 30 to 50% of the room would be people who were friends and plus ones of the people who are coming to the event.

then at the event all day long think about this all the people were there love you enough to show up to your event. And so they're all talking about how awesome you are whatever the thing is, and you're providing stuff to them. You're giving them food, you're giving them drinks, you're giving entertainment, you're walking around, you're kissing baby shaking hands, and so you seem like mayor of the town. So you get great positioning, and then all you do is as you go one-on-one, you say, hey, let's talk on Monday, hey, let's get a time set up, blah blah blah. And all you do is you set a shitload of appointments. Don't sell there, just set follow-up appointments so that it's fun, it keeps it chill, and that way you can collect a ton of leads. And after they've met you once in person, they're not going to ghost you on the next thing, and the likelihood they buy because their friends already there, they already literally consumed something from you, the reciprocity laws that it's highest.

amount, and so they're really likely to buy. So, two quick tactical things that I learned the hard way: don't book these too far out. Like, if someone's like, hey, I can do it two Eastern, I'm like, girl, you're here right now. I was like, get in on Monday. I was like, let's coaching starts now, let's go, you know what I mean? Like, I would like, I always try to have that kind of like playful rapport so I can get people in faster because obviously interest wanes really quickly, and so you have a very small period of time where motivation is super high, and so we want to capitalize on that moment. And after the event happens and I've already booked them, I treat them like a normal lead. So, I'm going to still work them, send reminders, all the normal stuff you do. Number seven is the spouse request. So, this is a good one. So, if you have a service that a spouse can do with them, so that could be like wine and paint night, that could be like

said weight loss that could be therapy that could be anything that somebody could do. You ask them so basically it proact the obstacle so you get to be aggressive on it and say, Hey, does your husband support you in this? Hey, do you think this would help your husband out and or your wife out, whatever? And by doing that you say, Hey, we have an amazing spouse program and we've actually seen that people who do it with their spouse, and this is the key part of it, is you want to have some sort of stat that's associated with it that shows that, 'Oh, people who do with their spouse are three times more successful.' And by doing that then it's like, Well, you want to be more successful. And so I would strongly like, I don't use the word mandatory, and I would even say this in the scripting, I never say the word mandatory, but unless your spouse has a reason like they're foot fell off or they're, you know, about to go to the hospital, they're crazy if unless it's

one of those reasons they should come with you, because I think it's going to, it's going to, it will be far more long-lasting, whatever the transformation is. It'll be far more effective, whatever our intervention is, and you're going to have a much better experience, and you'll have support here and at home, which makes it way more likely that you'll win. And the last one is a bonus one, which is a friend of mine runs massive, massive online challenges. So this isn't just brick and mortar or just service businesses like it works for any business. And you just have to think, how can I make this work for my business, not, it won't work for my business, because I promise you that is the voice of the loser, like beating you into loser ship. Okay, literally just in all messaging he had. All he did for an entire campaign was simply remind people in every piece of content, in every piece of messaging, in every ad, and every post that he did throughout the entire campaign was he just said, Hey, be sure to bring a friend.

it's far more likely that you'll succeed. You're going to love this if you do this together, and he just said it every time, and at the end of his campaign, and he's getting million-plus customers when he runs these campaigns, so massive, massive, massive scale. 25 to 30% of the customers that came in from the campaign were from Word of Mouth, were from unattributed sources, and when he didn't do this, it was almost nothing. And so he attributed that big jump to making sure that he wo in the bring a friend that bring someone else that you're going to be more successful that you'd have more support you'll get faster results if you do it together. And so I would encourage you, obviously, these tactics that I just outlined give you when someone asks for a discount how to do it if it's the holidays you use the gift card if someone has a great success that's the moment if you want to get an event you use it to use as a referral event all of.

these tools are things that you can use at specific moments. But the big overarching one is that if you know that you can generate about 30% of your leads. And this is just what I've seen across our businesses. By implementing these strategies, you get 30% more customers by just asking and actually weaving this in. And not being lazy about it. It's an obscenely easy way to get customers that are free, pay more, stay longer, and refer you more customers. Everybody wants to get customers, but ain't nobody want to ask for referrals.

The Outrageously EASY Way to Get New Customers

Day Job: I invest and scale companies at Acquisition.com | Co-Owner, Skool.
Side Hustle: I make free content showing how we do it 


Alex Hormozi

Strategies for Acquiring Customers Through Referrals

Referrals are valuable as they result in higher percentage, higher priced, and more frequent purchases, as well as bringing in more customers.

Implementing a simple strategy of asking for referrals after closing a sale can significantly increase the number of sales opportunities.

Referrals not only contribute to business growth but also have a higher likelihood of generating sales.

Maximizing Customer Referrals for Business Growth

Offering a referral program can offset customer churn and stabilize business growth.

A strategic approach to using gift cards, with significant discounts, for existing customers to refer to others can result in a higher customer acquisition rate.

By limiting the gift cards per customer and requiring them to be gifted to others, businesses can stimulate new customer referrals and ultimately increase their revenue.

Generating Revenue Through Referral Leads

Offering gift cards for referrals can generate revenue instead of incurring costs.

Setting a 30-day expiration date creates urgency for the leads to make a purchase.

By using the gift card as a discount for upselling to a higher-priced package, businesses can make a profit and offset the cost of the initial discount.

Effective Strategies for Offering Discounts and Incentives

Offering discounts in exchange for referrals can help in customer acquisition.

Another strategy is to offer additional services instead of discounts, which can provide greater perceived value.

Alternatively, offering extra value instead of a discount can reduce the effective discount cost for the business and encourage customers to use the product or service more.

Effective Referral Strategies for Boosting Sales

Offering a referral incentive of cash for every new customer brought in can significantly boost sales.

Utilizing both analog and digital methods for tracking and asking for referrals can help ensure a steady stream of new customers.

Asking for referrals at the moment of success, and using the customer's phone to send a personalized invitation, capitalizes on their satisfaction and excitement.

Effective Strategies for Getting Referrals

Using the point of success to ask for referrals has been highly successful.

Offering a bonus instead of a discount can also help in getting referrals.

Implementing a handwritten card strategy paired with in-person events can result in a significant number of new leads and customers.

Engage with attendees to set up follow-up appointments and maximize lead collection.

Avoid booking follow-ups too far in the future to capitalize on the high motivation levels of the attendees.

Utilize spouse requests as a proactive way to encourage engagement and participation.

The Power of Referrals in Business Growth

Referrals can significantly improve the success of a business, leading to a 25 to 30% increase in customers through word of mouth.

Actively encouraging customers to bring a friend or referral can result in faster results and greater support, ultimately driving business growth.

Implementing referral strategies and consistently asking for referrals can generate more customers for a business, leading to increased revenue and customer retention.