Ask IH: Would you refer another IH's product for 25% referral commision?
Hi IH!
Currently in the process of setting up a referral network for my company. I'm curious if any fellow IH have experience with referrals and the challenges that they faced. My company is offering 25% of revenue for 5 yrs to our referral partners. Do you think this will be enough to gain the attention of SaaS sales professionals?
Thanks!
Ben
If I'm not a customer of yours or have worked with you, I won't refer your product to my network unless you pay me a lot of money.
Not because I don't want to help - I do.
But if I share something with my network, I'm vouching for it (either the results or the team). And the trust of my network is worth a lot more than 25% of whatever :)
Good luck!
Thanks for the feedback Louis! I'm surprised that you consider 25% to be too low. What incentives have you received in the past to make it worth your time?
If your product is good, I'll refer it for free. If it isn't, there's no point me referring even for 100% of the amount - I'm just going to end up with a reputation for bad judgement which isn't worth any amount of commission.
I appreciate your honesty and input. Our initial target market is IT consulting firms in the US, which led us to the commission.
Do you think your view extends into B2B sales as well?
Yes, but only if I found value in the product. If I don't think a product is good and a good value, I won't refer it.
I might have some inputs. I'm the founder of FirstPromoter.com and worked with quite a few SaaS companies in the last 2 years.
From what I've seen, relationship state with your partners/affiliates matter the most, before the commission amount. If they don't trust you or the product, 10-15% difference in commission won't matter much. So if you start slowly build a relationship with industry leaders, without pushing your affiliate program right away, just help them as you can, it will help you a lot in the long run, not only on the affiliate sales side.
The consensus is to offer a better deal overall than your competitors, not necessary through a higher commission, but a better product, perks to the partner's network/audience like discounts, a free subscription to the partner, personalized sale/landing page, etc
Great answer! Having a % for the referrer + a discount for the final recipient is something that most programs miss.
Thank you for the reply! I really like what you said about offering a better deal overall. I was not thinking about personalized sale/landing pages or some of the other things I could do to sweeten the deal.