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Developing a Strategic Approach to Senior Living Referrals

We’ve long known that referrals are king when it comes to getting prospective residents in the door. They’re generally the most effective and economically efficient source to achieve marketing success for your community. In fact, leads from a referral source are often between 3 and 5 times more likely to reserve a residence than are non-referral sources – and the cost of cultivating those leads is generally lower than the average cost per lead.

It’s no secret, either, that organic referrals come primarily from satisfied residents and their families. Communities with successful referral programs develop a culture of referral generation by consistently encouraging involvement with residents and their family members. All residents are already part of your marketing team, whether they realize it or not. They have pride and share a vested interest in their community being successful. It’s in both your interest and theirs to cultivate an approach for developing referrals in your community.

Like anything else in life, communities need an action plan to capitalize on the opportunity that referrals present. Take stock of your current process for collecting referrals, and establish key performance indicators by which you can set goals and measure your performance.

How to Establish Key Performance Indicators for Referrals:

  1. Compare referral and non-referral inquiry and buyer percentages. Layer in marketing expenses for referral and non-referral activity, and compare the cost per inquiry and cost per sale against the average. (For help determining these and other values, try using our Referral KPI Worksheet.)
  2. Establish goals to determine what you would like to accomplish with your referral program. For example: By {DATE}, we’ll increase referrals from {#% to #%}.
  3. Quantify how many additional referrals you need to accomplish that goal.

At first, you might wonder how many referrals you can achieve. Keep in mind there are numerous referral outlets that you may not have considered, which can be key drivers to overall program success.

Referral sources include, but aren’t limited to: Resident referrals, future resident referrals (for example, wait, priority or charter lists), lead referrals, family referrals, stakeholder referrals (for example, employees and board members) and professional referrals.

With a goal in place and a defined approach, you’ll be poised to successfully implement a high-performing referral program at your community that positively impacts your bottom line.

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