How to Run a Tax Services Referral Program [+ Free Tools]

Are you ready to grow your tax services business with a simple yet powerful strategy? One amazing way is by tapping into the potential of referrals from past customers. Word-of-mouth is alive and well in the tax services industry, and there’s no better way to boost your business than by leveraging happy clients to ignite a referral cycle.

In this blog post, we’ll explore the ins and outs of tax services referral programs. We will discuss why they’re great for your business and provide you with expert best practices for launching one. So get ready to supercharge your client base with this fantastic marketing approach!

What is a tax services referral program?

A tax services referral program is all about encouraging and rewarding customers for telling their friends about your stellar tax filing service.

These programs offer incentives when a current client refers their friends, family, or followers to your business. Referred customers usually receive an attractive discount or another benefit when they complete their first tax return with you. And referring customers get an incentive too, like a discount or cash back, as a thank you for their successful referral.

The wonderful thing about tax services referral programs is that they make it easy for accountants like you to track who’s bringing in new clients, so everyone gets rewarded in a timely manner.

Benefits of a tax services referral program

There is a reason why more and more tax professionals are jumping on the referral program bandwagon. In fact, there are several. Here are some of the advantages you can expect to enjoy when running a tax services referral program:

• Increases awareness of your tax services: As people spread the word about how great you handle their taxes, more potential clients will be drawn in.
• Effective for client acquisition: Friends trust recommendations from family members or workmates above ads or hype. As a result, referred customers will appreciate the personal endorsement and give your service a try.
• Brings in loyal clients: Due to friends vouching for them, referred clients are likelier than others to stick around.
• Cost-effective method: You’ll discover that referral marketing requires less investment than traditional advertisements while producing better outcomes.
• Trackable word-of-mouth promotion: The beauty of these incentives lies in pinpointing which customers are spreading the word about your business, and how often.

Referral software for tax services [Free Tools]

These referral tools for tax services are a free and easy way to help you start your referral program.

Want a fully automated referral program for your tax business? Run your referral program with us at Referral Rock. Find out how we can build your program with you (and tailor it to your unique needs)

Essentials for a successful tax services referral program 

Even with all the benefits, not all tax accountants are ready to start a referral program. In order for a tax preparer referral program to be successful, you must have the following elements in place before you launch:

• A healthy network of satisfied clients, who would willingly recommend your tax prep services
• A track record of stellar service to clients
• A digital presence (website or portal) where you can track clients’ referrals
• Capacity to handle an influx of new clients
• Knowledge of existing clients:
  • Demographics
  • What made them enroll for your services
  • Why they chose you over competitors
  • How they communicate with their friends
  • What rewards would motivate them to refer friends
• A profile of the ideal new client (the ideal referred friend)

Tax services referral program best practices

Unlike traditional word-of-mouth, referral programs aren’t something you can just leave to chance.

This section will explore the top tips for designing a user-friendly refer-a-friend program that keeps customers coming back:

Offer the right rewards

The key to convincing people to bring more friends is fantastic rewards. If people feel like they won’t get much out of your program, they’ll be less likely to participate. To create an appealing incentive, rewarding both the individual who made the referral and the newly referred client is key – this is known as a double-sided rewards structure.

Promptly granting rewards when newly referred customers use your service will keep spirits high all around. The best rewards are discount coupons or credits towards the tax preparation fee. These are great reward options for both the referring client’s next appointment and the referred client’s first appointment. You might also pay the referral rewards in cash, as both referring and new clients will appreciate money back after doing their taxes.

Other options for the referring client might include gift cards for popular local stores, gift baskets, and sports tickets or event tickets. No matter what you choose, make sure everybody comes away feeling appreciated.

To maintain interest, provide unlimited rewards without setting caps on successful referrals. Keep amounts reasonable, yet enticing enough to generate excitement. You’ll know what is acceptable to pay by calculating a customer’s average Lifetime Value (LTV). This is how much a customer typically spends during their lifetime with your business. Your reward should be directly proportional to the LTV.

Think about using different reward structures

It’s a good idea to mix things up with your referral offerings. For instance, you might implement a tiered structure that gives more rewards for higher numbers of successful referrals within the same tax year. This way, valued customers know they’ll get even better results by referring additional friends or family.

For example, you might offer a 20% discount on the next service for one successful referral, and reward customers with completely free preparation of the next season’s taxes after three referrals in the same tax season. This encourages customers to stick with you over time while experiencing increasingly valuable incentives.

Another fun idea is holding a Tax Season Referral Draw, where each referral earns an entry into an exclusive contest with memorable prizes. Not only does this create excitement among loyal clients, but it also opens up opportunities for those who participate infrequently!

Recognize unusually efficient referrers with bonus prizes tailored just for them – curated gift baskets or experiences they’d love. When tallying referrals at the end of the year, you’ll see who’s sent you the most business. These types of individualized gestures go a long way toward fostering loyalty and goodwill.

You might also give added incentives to dedicated promoters if their referred person continues to use your tax services in subsequent years. Ensure these “retention bonuses” add an extra layer of appreciation and convince them how much you value their repeat business.

Use software to track your referrals

When running a referral program, it’s crucial to establish and monitor progress toward measurable client acquisition goals. This will allow you to see if the program delivers the desired results. Plus, staying on top of successful referrals ensures all rewards are issued in a timely fashion.

Enter referral software – an essential tool for managing a tax services referral program. Without it, it would become extremely challenging to manage the sheer volume of information, especially if you’re an individual tax preparer or part of a large firm. With dedicated referral software at your disposal, you can precisely track the source of each referral.

Referral software also lets you keep track of success rates and fine-tune your program accordingly. What’s more, with automatic referral links generated by the software, clients can easily share their unique links with others. The result? Referrals turn into conversions, and rewards are automatically issued once earned.

Know when to ask for referrals

Recognizing opportune moments to ask clients for referrals often results in higher chances they’ll share your services with friends and family members. Here are some ideal times:

1. Shortly after their tax appointment.
2. Whenever they discuss your services with friends (in person or online).
3. After leaving positive feedback or rave reviews.
4. During regular follow-ups, when you know they’re satisfied.

You might also want to consider asking top clients right before, or at the beginning of, tax season, so your business stays fresh in their minds.

Make it easy to share

The very basis of a referral program is to make it as easy as possible for people to share your services. It should take as few clicks or taps as possible to find and share your tax services through the referral program. Once clients are on the program page, a good measure is to integrate various sharing options into your service. Whether through emails, social media platforms, or messaging apps, remember to ensure referral links are automatically generated and ready to be shared. Clients should also be able to copy their referral links for direct sharing, anywhere that’s convenient to them.

Encourage your clients to use your referral program frequently by providing clear instructions on how it works, in only a few simple steps. Offer an uncluttered page layout so users can locate relevant information quickly. Also, you don’t want to give them more work than necessary. Don’t make your referral form too long – only ask for the necessary information.

Finally, remember to optimize your website and referral program for mobile access, especially if you offer mobile tax services. Nowadays, most people use their phones to access the internet, so the website should be designed with mobile users in mind.

Don’t just limit your program to tax season

Some tax preparers choose to run limited-time programs exclusively during peak periods, since that’s when their services are most relevant. However, it’s important to remember that tax services referral programs can be valuable all year round. People are often looking for reliable tax preparers, even during the off-season. 

Your clients will be more inclined to promote you when constant rewards are on offer. You’ll also see better time and money investments materialize, as initial program setup costs are spread across a longer period. Referral programs take time and money to set up and promote – deactivating shortly after setup isn’t the best time and money investment.

By maintaining a continuous program, you capitalize on increased trackable shares, encourage repeat referrals from individual clients, and eventually reap greater returns.

Promote your program on a variety of channels

Unless you have time to personally invite all your clients, you must promote your referral program to the right people in the right places. Ensure that all clients are aware of the rewards for sharing by promoting your referral program in your various digital channels:

• Post about the program on your business social media account
• Promote the program on your website’s homepage
• Include a referral section in your online portal, so clients can find it when they log in
• Place “refer a friend” options in website headers and footers
• Send mass program promotional emails
• Send personal email invitations to top clients 
• Promote the program in email newsletters
• Mention the program in transactional emails or invoice emails
• Direct clients to the program after they have given high ratings on a client satisfaction survey

Note that these methods pertain to digital channels. But if you have a local firm where clients come to you in person, you can also take advantage of physical marketing materials like referral brochures, banners, and business cards. Display them throughout your office and encourage clients to pick up a few for their friends.

When to time your promotions?

• You’ll want to promote the program most heavily right before, and at the beginning of, tax season.
• But you should also promote it year-round, since your program is ongoing. (Ongoing promotion is especially vital if you serve types of clients who are consulting you outside of the standard tax season, like small business owners and self-employed individuals). 

Thank customers for referrals

Finally, don’t forget to thank your clients for referring their friends. Sometimes all it takes is some gratitude to encourage further recommendations – particularly those that lead to new clientele. Send personalized thank-you notes (preferably handwritten) after each successful referral.

If you’re active on social media, consider sharing public words of thanks to showcase your appreciation.

Bottom line

Referral marketing can be a great way to drive new business for tax preparers and accountants. Following these steps will increase the success of your tax services referral program and help grow your practice. However, nothing beats a professional solution for your business. Investing in the right software can help ensure that your referral program runs seamlessly and efficiently.

Check out Referral Rock, a referral marketing software designed to help you automate customer referrals and track their progress. With Referral Rock’s comprehensive features, tax preparers and accountants can easily set up and manage the entire process from one centralized platform. Get started today to maximize the success of your referral program!