Locorum Blog

Referral & Rewards Program 101: Best Practices for Realtors

Written by Locorum | May 28, 2024 1:00:00 PM

We all know referrals are the highest-converting channel. But if that’s the case, why isn’t everyone taking advantage of it? Usually, it's because they don’t know how. 

Ask yourself the following:

  • Are you avoiding starting a referral program because you don’t think it’s “needed?”
  • Are you not encouraging referrals but will “throw something in” if someone refers a friend to you?
  • Do you have a referral program, but it’s out-of-date (perhaps a lengthy form)?
  • Do you have a referral program but aren’t talking about it?
  • Do you need to know where to start with your referral program?

If any (or multiple) of these sounds like you, you might be missing out on your largest lead channel: referrals. 

But don’t worry — you came to the right place. Here’s your complete guide to referrals and incentives. We’ll show you how to reach this untapped market by using your current database to improve your word-of-mouth business.

What is a Realtor Referral and Rewards Program?

Let’s keep this short, because in the real estate world, we are all familiar with referrals. A realtor referral and rewards program is: 

“A referral program is where you offer a fixed amount or percentage of your sales commission to past buyers, other agents, or anyone else who refers a friend to you upon a closed deal. A rewards program is when you offer rewards to your database for events, contests, or anything else you can think of.”

Referrals and rewards go hand in hand. Referrals are direct incentives to get someone to introduce you to a new client. Whereas rewards are more focused on rewarding your current database. Both result in more business and a happier client base. Using them together will bring you more leads and a successful real estate business. 

Why Should I Worry About a Referral and Rewards Program?

Referrals are one of the most valuable leads for one main reason: they are the most likely to complete your desired action. In your case, this is likely to buy or sell a home through you. This means more business for you and time saved from qualifying leads. Plus, referrals are one of the most affordable ways to bring in business. You only need to pay on a successful deal (i.e., contract signing), unlike ads and other methods where you pay to get people to come to you.

 

When you ask most realtors where they get most of their business from, they’ll say referrals. But the majority of real estate agents get less than 20% of their past clients to send them leads. With referrals being the highest-converting channel, this is a huge market that you may not be reaching. Tap into this market to boost your business and reward your loyal clients for sending you leads.

How to Start a Referral and Rewards Program

Some businesses do rewards and referrals the old-fashioned way: a lengthy form that no one has time to fill out to get referrals and going to the nearest store to buy a bunch of gift cards for the rewards. There is an easier solution that is proven to save you time and get more leads: referral and rewards platforms. 

Referral and rewards platforms (often alled referral software, referral platforms or rewards platforms) that allow you to create, manage and track incentive programs - like Locorum. These platforms help you make the referral and rewards programs easy by having everything in one place. 

Why Consider a Referral and Rewards Platform With Locorum

As we said above, it’s a lot easier for you to start and manage a referral and rewards program with a platform. But here are some other reasons why you should consider Locorum: 

  1. Save time, so you have more time to sell. 
  2. Our patent-pending system is the easiest way for your clients to send referrals, with no need to make an account.
  3. Easier referrals mean more referrals - for each additional field you add, people are 50% less likely to complete the form.
  4. The convenience of having all your referrals and rewards in one place.
  5. Easy payouts on custom-branded cards.

Heard enough? Talk to our team to get started.

The Focus of Your Realtor Referral and Rewards Program

There are three things to keep in mind with your referral program: reward all referrals, choose the right times to ask and be consistent. 

Reward All Referrals

 

Offering incentives for successful referrals is crucial in your strategy. If you got a reward when a deal was complete, you’d be more likely to want to close it and get the offer. Your customers are the same - 79% of people are more likely to close if there’s a reward involved. 

So, the first step is to set up a rewards program and budget (learn how with Locorum here). 

Let’s fast forward a bit. Say someone referred a friend to your program, but it might be a year or so until the deal closes and either of them sees a reward. Instead of waiting, send a small gift to show your appreciation. It only has to be $10-$25 and will keep your clients happy and wanting to refer. Send a message alongside the reward like this: 

"I'd like to buy you coffee to thank you for the introduction to [friend name]. I've sent over a gift card via Locorum as a genuine thank you from us. Introductions like this are the lifeblood of small businesses, and I want to express my gratitude. If the deal closes, you'll be eligible for $[amount] through the same Locorum referral program. Any other introductions are greatly appreciated. If it's more convenient, you can use this link to refer."

Plan When You’re Asking

Timing is everything when it comes to asking for referrals, and the answer is simple. Ask for referrals when your customers are happiest. Put yourself in your client's shoes. If you bought a house and got an email asking for referrals on move-in day, you might ignore it because you are busy. But if you got the same email one month later, when you’re unpacked and settled in, you’re more likely to consider it positively and send a referral. 

Consider adding these top times to ask for referrals to your communication strategy:

  1. Contract signings
  2. Closing gifts
  3. First-year check-ins
  4. Home anniversaries

Consistency is Key

This one’s simple: Keep mentioning your referral program. Highlight it anywhere you can think of. You may think you’re talking about it a lot, but chances are that your client won’t remember. The “rule of seven” indicates that something needs to be seen seven times before someone remembers it in any detail or takes action.

Make sure your referral program is prominently featured across all of your marketing channels to make it as easy as possible for clients to find. If it’s hard to find or understand, clients will be less likely to complete it. We’ll go over where to promote your program in a bit; just keep this in mind when creating your strategy. 

How to Ask For Referrals

Make asking for referrals a natural part of your interactions. Mention it as much as possible and on as many channels as possible without being pushy. A great way to do this is by mentioning it in all your marketing materials rather than outright asking. 

We recommend always including the dollar amount of the reward in your messaging to increase the appeal. Consider messaging like this:

  • “Don’t forget about our rewards program to earn up to $2000.”
  • “Join our reward program today to earn up to $2000.”

These are casual ways to ask them to keep it in their minds and highlight the reward they can earn. 

Where to Promote Your Realtor Referral Program

We may sound like a broken record when we say that you should include your referral program as much as you can, but it’s key to your success. We’ll go through the top places you should consider promoting your program.

Want the TLDR? Here are the five best practices for skyrocketing your referrals.

What Everyone Should Do

There are hundreds of ways to promote it, so let’s start with the basics that everyone should be doing. Start by incorporating your referral program into your existing marketing collateral. Every realtor should incorporate all the following options.

  1. Website
    Make sure your referral program stands out on your homepage and in your navigation bar so clients see it every time they visit your site. Create a dedicated section that explains your program's benefits clearly, with a direct link to your custom URL from Locorum.
  2. Sales team email signatures
    Pop your referral program info into your team's email signatures to keep it top of mind. Include clickable text like "Refer to me: Click Here" or "Send a Referral, Get $[Reward]" to encourage engagement. Here's how to add it.
  3. Business cards
    Stick a QR code on your physical business cards or a link to your virtual ones. This way, every time you hand out a card, people will have easy access to your referral program.
  4. Phone contact
    Link your referral program in your phone contact information. This means that everyone you share your contact with will receive your referral link. Learn how here.
  5. Social bios
    Add your referral program info to all your social media bios using Linktree. If you haven't got a Linktree yet, it's a free tool that lets you compile multiple links into one URL. We suggest adding your referral link alongside other useful links. We've even got it on ours.

  6. Emails and newsletter
    Include your referral link in all your emails, including your monthly newsletter (if you're not already sending one) and any other email campaigns. There are a few ways to do this, but we suggest adding it to your footer, signature, or banner graphic in each email. Here's how we include it in our email signatures:

While you’re at it, feel free to take a look at our referral program and refer a friend to earn $150 (see how easy it is to mention)!

Referral Launch Announcement

Now, it’s time to announce your referral program to your audience. We suggest doing this through email and social media. 

Email Announcement

Start with an email blast to all past and potential buyers. Introducing your program, highlight its benefits, and include the program link.

Pro-tip: Locorum offers a variety of email templates for announcing your referral program. Simply choose one and add your details!

Here’s an example from The Parker Coulter Team that you could send. 

Learn more about this campaign, the results and why we like it here. 

Social Media Announcement

Share the announcement across all your social channels, including Facebook, Instagram, LinkedIn, and X. Remember to include your program link or where to access the referral program and the reward amount. You can re-use content from your announcement email. For example, you could post:

Your next reward is just a referral away - earn $250 🤑

In the spirit of giving back, we’re introducing our brand-new referral program to reward you and your friends. If you introduce us to a friend who buys or sells with us, we’ll send a $250 pre-paid Mastercard to both of you. 

Let’s make property dreams come true together. Use the form below to start referring today and turn every successful recommendation into a win-win celebration!

[Program link]

Include an eye-catching graphic, and you’re good to go!  

Post about your program on your social media channels regularly for effective frequency. We recommend posting monthly to remind clients about the program continually.

Additional Campaigns

In addition to your monthly newsletter (which you should already be sending), consider adding these campaigns or sequences to your communication plans.

  • Question of The Month
    A Question of the Month campaign is an interactive campaign where realtors pose a new question to their audience each month, encouraging responses and engagement. Run it through social media polls and your email newsletters to collect valuable insights into your audience's preferences and interests. This approach fosters stronger connections with clients and provides a platform for personalized communication and rewards.
  • Home Buyer Tips
    Send potential home buyers an email campaign with tips and information about buying a home. These emails can include things about the process, where the industry is at and anything else you think would be valuable. Aim to educate and guide buyers through the home purchasing process, positioning yourself as a trusted expert. You can also post these tips on social media to increase your reach. 
  • Home Seller Tips
    On the other hand, send your sellers an email campaign with home-selling tips and tricks. This will be similar to your home buyer campaign, just for your sellers.
  • Home Maintenance Checklist
    Send a home maintenance checklist email campaign to recent buyers with region-specific tips and reminders for maintaining their properties. This can be a one-off email with a checklist or a recurring sequence based on when the time of year. 
  • Mortgage Renewals
    Mortgage renewal reminders to past buyers with an offer to help out go a long way for clients. Offer to connect them with a mortgage agent or help them negotiate and give advice for upgrades/renovations. We recommend scheduling emails starting three years out on a six-month basis (36, 42, 48, 54, and 62 months after purchasing a home). 
  • Periodic Check-Ins
    Go the extra mile by adding workflows to check in on past buyers. Set the emails to be from your sales team asking how everything is to stay in touch and mentioning your referral program.
  • Holidays
    Spread the holiday cheer by sending out emails on the big holidays, expressing your gratitude for your customers. Christmas, New Year, Canada Day, Mother’s Day and Father’s Day are all great ones to include, but schedule them for any holidays you wish. For some, consider sending a small gift reward to thank them, but you don’t need to include this with every holiday. 

Physical Marketing Materials

Now that we’ve gone over some digital campaigns, let’s go through some physical marketing collateral where you can promote your referral program. As part of your Locorum subscription, we can generate a QR code for you to include in the following materials (reach out to learn more). 

  • Posters in Showrooms
    Create eye-catching posters and place them in your showroom.
  • Signs in Open Houses
    Place signs at open houses to attract potential clients.
  • Banners at Trade Shows
    Use banners at trade shows to promote your referral program to a wider audience.
  • In Front of Modules on Boards
    Place signs in front of modules to encourage visitors to scan and learn more.
  • Brochures and Other Marketing Materials
    Include information about your referral program in your brochures and other marketing materials.
  • Property Feature Sheets
    Add a section about your referral program on feature sheets for potential buyers to see.
  • Postcards to Send Customers with Swag
    If you send swag to clients, include a postcard with information about your referral program.
  • Door Hangers
    Distribute door hangers in areas you sell to reach past buyers. 

  • Neighbourhood Signage
    Post signage in the neighbourhoods of your sites to increase visibility and encourage residents to refer their friends to nearby homes.

Including a referral QR code in these marketing materials will get you in front of more past or potential clients.

In-Person Asks

Talking about it in person is usually more direct, also known as a “hard ask.” When meeting with clients, whether in person or over the phone, talk about your referral program. Plan when you will ask to avoid bringing it up too much. 

At Milestones

We’ve already mentioned to talk about it when your clients are happiest. Mentioning your program at key milestones increases the chances of referrals. Consider asking when clients are likely to be most satisfied, such as:

  1. Contract signing
  2. Post deposit
  3. Inspection date (only if it’s a positive inspection!)
  4. Possession date
  5. One week after move-in (since  move-in day is often hectic)

Referrals from Referred Clients

Asking people who were referred to you previously is a great strategy since they are already familiar with the process. Referred customers are even four times more likely to refer friends. 

 

After they’ve had a positive experience, whether they bought from you or not, it is a great time to ask for referrals. Let the conversation flow naturally, and bring it up at the end of your meeting. 

When Clients Aren’t Interested

Ask people who aren't interested in buying from you if they have friends in the market. Just because this home wasn't the right fit for them doesn't mean it won't be perfect for one of their friends. Everyone appreciates rewards, so why not offer them? Be cautious and only mention your program to people who have a positive impression of your business.

Events

You might already host some community events, so we recommend mentioning it to clients there. Additionally, consider the following events or seminars for past or potential buyers. These will help position you as an expert, meet clients, maintain relationships and give you a chance to highlight your referral program. Each of these could be in-person or online.

  • First-time home buyer seminar
  • Investor seminar
  • Downsizing seminar
  • Career in real estate seminar

If you want to go the extra mile, consider offering a reward to attendees or those who refer a friend to your event. You can give $10 each or hold a draw for $100 at the end. 

Additional Campaigns

A referral program where a client or another realtor refers a friend to you isn’t the only type of campaign you can run. There’s actually lots you can do, and we’ll go through a couple of our favourites.

Home Equity Report Program

Our number one recommendation (other than your general program) is a Home Equity Report Program. There are two sides to this program for your clients:

  1. Sign up and get $25 in instant rewards
  2. Refer a friend and get $25 each

So, if someone signs up for a home equity report, they get $25. Then, encourage them to refer friends, and they and their friends will each get another $25. 

Here’s everything you need to know about setting up a Home Equity Report Program.

Sign Up For Your Dream Home Finder

A program that encourages people to sign up for a customized home search isn’t about referrals but will still get more clients through your door. We recommend framing it as finding their “dream home” to encourage them to sign up. When someone signs up, all you need to do is set them up for a customized home search and send them $10-$25. It’s a small budget for more clients. 

You could also run a campaign where once they sign up, they get a reward if a friend signs up too (i.e., give $10, get $0 when your friend signs up) 

When to Send Rewards

We’ve talked a lot about referral programs. Now, let’s get a little more into rewards. Scheduled rewards, such as those for birthdays and home anniversaries, can go a long way toward showing appreciation and keeping clients engaged. 

It doesn’t have to be a huge reward; anything from $10 is a nice bonus for your customers, depending on what the reward is for. We’ll outline some of the top times to reward your clients, along with some tips to personalize them. 

  • Home Purchase
    Closing gifts are common in real estate. Consider sending a rewards card to allow your clients to choose what to purchase. Celebrate your clients' milestones by sending them a reward when they purchase a home. This is the only reward we recommend sending over $100 since they’re making such a large purchase with you. This not only shows your appreciation but also reinforces their decision to work with you.

    If your clients are moving to a new neighborhood, consider sending them a Neighborhood Explorer Pass. This is a curated list of local recommendations and personalized tips that are tailored to the interests and preferences of new homeowners. It includes suggestions for restaurants, attractions, services, and other points of interest in the area, helping them feel more at home and connected to their new community. It helps show you care, and were thinking of them when giving the gift.
  • Home Anniversary
    Recognize your clients' loyalty by sending them a reward on the anniversary of their home purchase. This gesture can strengthen your relationship and encourage them to refer others to you.
  • Contract Signing
    While less conventional, sending a reward on contract signing in addition to a closing gift can be a unique way to show appreciation for your client's commitment. This gesture can set you apart from others and leave a lasting impression.
  • Home Inspections
    Another way to go the extra mile is to send a gift reward if the home inspection comes back with repairs. This will show you care and help them repair any damages in their new home. 
  • Birthday
    Send your clients a birthday reward to celebrate their special day. This personal touch can make them feel valued and deepen their connection with you.
  • Wedding Announcement
    It’s important to celebrate the big moments. When your clients announce their wedding, consider sending them a reward. This thoughtful gesture can strengthen your relationship.

  • Baby Announcement
    Celebrate your clients' new arrival by sending them a reward to show you care. 

Check out our examples for birthday, closing gifts, and home anniversary reward emails.

While we recommend sending a reward at these times to show appreciation, you can also send an email campaign if you don’t have the budget to send a small reward.

How to Send Rewards

Make your rewards more personal by sending a custom-branded Mastercard through Locorum. Branding your own cards not only enhances your brand image and professionalism but also fosters customer loyalty and sets you apart from competitors. Every time they use their reward, they’ll think of you. Contact our team to learn more. 

How Anita Lamarche Used Locorum to Enhance Client Engagement and Referral Sales

Anita Lamarche, a realtor in Calgary, has revolutionized her referral program using innovative strategies with Locorum. Here’s what she’s doing:

  • Using QR codes for her referral program on business cards and promotional gifts to broaden her outreach.
  • Leveraging personal interactions at networking events and client meetings to verbally promote the program ensures higher engagement.
  • Using Locorum’s Gift Rewards Tool to save 4-6 hours per month.

On top of that, Anita’s strategy is resulting in a 50% deal success rate and more new deals.

Learn more about Anita’s story here.

Running a successful referral program requires more than setting it up and hoping for the best. It demands consistent promotion and strategic implementation to achieve its full potential. But don't worry; Locorum is here to help. Did you know that we offer a dedicated onboarding manager service to help you get started?

If you need assistance setting up and promoting Locorum, contact our team — it’s like hiring a referral marketer for a fraction of the cost!