Case Study: How This Solar Business Generated Over $8 Million in Revenue Through Referrals

When it comes to solar, people are way more likely to trust the recommendations of friends and family than any other type of advertising. The reason why is pretty obvious – going off the grid is a big investment, so it’s not the kind of purchase people make lightly. 

So, how are solar companies leveraging word of mouth? Through refer a friend programs! The good news is that 76% of people are willing to refer a friend after they’ve had a good experience with a company — all you need to do is ask. 

This referral program case study walks you through the strategy that saw this Australian solar energy company generating over $8 million in revenue through referrals alone!   

🏛️ Niche: Solar Energy

💵 Business type: B2C

🌎 Location: Australia

🧑‍💼 Size of the company: 100+ employees

This forward-thinking solar energy company creates sustainable solutions for homes, businesses, and even factories. They were inspired by a competitor’s referral program success and decided to give it a try.

👉 Here’s how they did it:

• Targeted program. They focused their referral program on the residential arm of their business, offering a $500 AUD reward to existing customers who referred friends and family and a sweet discount for new referrals.
• Win-win situation. Existing customers got rewarded, and new customers got a great deal on going solar. This double-sided reward strategy is the secret to success when it comes to customer referral programs. Not only are friends more likely to convert if there’s something in it for them, existing customers are way more likely to refer if they have an upside to offer.
• Referral rocket ride. The program was a huge success, skyrocketing to become their top lead generation channel in 2023! Their revenue saw a significant boost, all thanks to the power of referrals.

This story proves that you don’t need a huge budget to shine in the solar industry. By implementing a smart and strategic referral program, this company was able to attract new customers, reward existing ones, and ultimately, power up their business, all without breaking the bank. 

Their Challenges (What Led Them To Referrals?)

Facing a crowded marketplace and a long sales cycle, this solar energy company needed a game-changer to compete effectively and expand its reach. 

👉 Challenges:

• Cutthroat competition. The solar industry was brimming with companies offering enticing referral programs. Staying competitive was crucial.
• Limited reach. Traditional customer acquisition channels weren’t delivering the desired results. The company was struggling with increasing market penetration and expanding its customer base.
• Time-consuming sales cycle. The process of converting a lead into a customer took a significant amount of time. A solar energy system is a big investment, and a lead isn’t considered converted until after the installation is complete. From start to finish, the process can take at least 3 months.

How the Referral Program Helped Them Overcome These Challenges

The solution was a strategic referral program designed to solve the burning issues:

🎉 Leverage customer trust. By incentivizing existing customers to refer their friends and family, they tapped into the power of positive word-of-mouth. To ensure that referral program participants could stay on top of their progress and stay engaged over the longer sales cycle, Referral Factory experts suggested implementing a tracking dashboard, where referrers could log in and see the status of their referrals.

🎯 Penetrate the market deeper. Referrals often come from within social circles, allowing the company to reach new audiences they might have missed otherwise. The best part is that referrals tend to be laser targeted because people tend to socialize with people in the same demographic.  

✂️ Shorten the sales cycle. By leveraging the trust established by a referral, the initial sales conversations could be more streamlined.

How Their Referral Program Works 

Here is the thing: double-sided referral programs (where both the person referring and their “friend” are rewarded) tend to vastly outperform single-sided referral programs (where only one participant gets a reward). 

Here is how this solar business structured its referral program – to participate, existing customers sign up for a unique referral link. When they shared that link with their friends, the potential new leads were instantly directed to a personalized invitation page with all the details of the special offer.

🎁 What does the person referring (the existing client) get?

To drive referrals for new solar panel system installations, the person referring received a $500 cash reward for each successful referral. This attractive reward made all the difference.

🎁 What does the person invited (the new client) get?

At the same time, the person invited enjoyed a 10% discount on their solar panel installation.

So, it’s a win-win! Everyone gets a reward by participating in this referral program.

How the Company Promotes Its Referral Program

Encouraging existing clients to refer their friends was the major objective of this program. Even though anyone could join, the clients who were already using the service were in the best position to tell others about it. So, the company focused on making it easy for participants to join and asking them to refer their friends when the time was just right.

💡 Pro tip:

The best moment to ask for customer referrals is right after they had a good experience. For instance, this company found that sending a thank you postcard about a week after installation worked wonders. They included all the details about the referral program in the postcard.

To keep referrers interested, they provided tracking links where people could sign in to track their progress and rewards. The reward for referring someone was $500, which is a pretty big deal. However, the sales process took a while, and the person doing the referring had to wait around for around four months to get their reward. To keep them engaged, the company set up dashboards where a client could log in and track their progress.

Final Results & Metrics

In just six months, referrals became the number one way this solar company found new customers. After a bit more than a year, they got 3,710 potential customers, and out of those, they converted 1,410. That’s a 38% success rate, much better than any other way they found customers before. And because their sales cycle takes a while, many of these new customers are still in the process of making a deal.

Each customer spends about $6,000 on average. So, from referrals alone, they’ve made around $8,460,000! Even though they offer big rewards, it’s still cheaper to get new clients this way than paying for ads.

Client Testimonial

“Working with the Referral Factory team was a game-changer for our business. They helped us set up a referral program that really worked. Their support and guidance were top-notch, and our referral program brought in more customers and boosted demand for our solar panel installations. We’re grateful for their expertise and the positive impact they’ve had on our business.”

— Director of Marketing

Conclusion

This solar energy company’s story is a testament to the power of strategic referral programs, even for businesses facing unique challenges like long sales cycles. By customizing their program to their specific needs and utilizing the right referral software, they were able to overcome their challenges.

This case study serves as a valuable example for businesses of all sizes and industries. It proves that with strategic thinking and the right tools (of course), even a simple marketing tactic like referrals can be transformed into a powerful lead generation machine.