What’s the Word Out There?

This chapter discusses the value of referral programs and the customers that such programs bring, in both B2C and B2B contexts. This chapter introduces an analytical approach for calculating Customer Referral Value (CRV) and explains how it incorporates the various concepts and usage of referral behavior. Further, this chapter also discusses how CLV aligns with CRV in identifying the value of customers and enhancing it through optimally designed marketing campaigns. In addition to this, this chapter also presents the concepts and metrics to value referral behavior in a B2B setting. Particularly, the concept of Business Reference Value (BRV) is presented, along with a conceptual framework to compute it. The metrics discussed in this chapter enable managers to value customers based on their indirect impact on the firm’s profits from both the savings in acquisition costs and the growth of new customers who were referred to the firm by existing customers.