How to start an online referral business

Written by leslie truex Google
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Referral businesses are affordable and fairly easy to start. By bringing your referral business online, you have greater reach to your market for not very much money. Here are some tips for starting an online referral business.

Skill level:
Moderately Easy

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Things you need

  • Business name and business structure (i.e., sole proprietorship)
  • Business permits or licenses
  • Office space and equipment
  • Operating procedures
  • Contracts and forms
  • Start-up money

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  1. 1

    Decide what kinds of referrals you will offer. You can make referrals for just about any kind of business, such as child care providers and nannies, handyman services, and rental or roommate referral services.

  2. 2

    Determine how you'll get paid and how much you'll charge. Decide whether your clients will pay to be listed in your referral database or if the people looking for referrals will pay to access your database. You may want to do market research to find out which has the potential to generate the most income. Since your clients are marketing themselves, it is probably better to charge them for your services. Many people who go online looking for referrals are expecting to get the information for free. But if you have unusual or difficult to find referrals (i.e., job referrals), it could be that charging for access to your information is warranted.

  3. 3

    Begin building your database. Before you can launch your business, you need to have a list of referrals to give to potential visitors. To find referrals, look in the Yellow Pages of your phone book, the classified ads in your newspaper, and even online for people who are providing the service for which you plan to have referrals. Contact them with information about what you are doing and explain how it can help their business. You may want to offer a discount price for being the first to be in the database (if you're charging to be in the database). Because they may want to see your web site before joining with you, you can have your home page and information about your service posted (see next step) without yet having access to the database.

  4. 4

    Outline your website plan before going online. Websites can get overwhelming and complicated very quickly. Before building or hiring someone to build your site, organise your site on paper. How will the referrals be organised? Will you have other information on the site, and how will it be organised?

  5. 5

    Hire a database developer or get a good database program to run on your site. Some Web hosts offer this in their hosting package. The most helpful databases are those in which people can search using terms that fit their needs. If you're charging people to be included in the database, your service will be most appealing if they can add their submission to the database themselves immediately after payment. If you don't know how to set this up on the Internet, hire someone to help you.

  6. 6

    Build your web site. Hire a Web designer or build your own site, integrating the database and search features. Sign up for Web hosting. Find a host that will allow you to run your database and that offers any other features you want or need. Whether you're charging for access to the database or charging people to be included in the database, you'll also need a payment processor that integrates with your site. Your Web host may have a shopping trolley feature that you can use. If you choose that option, your host will let you know which payment processors will work with the shopping. PayPal is another option.

  7. 7

    Market your web site on the Internet. People can't use your service if they don't know about it, so figure out who your market is and put your message in front of them. Options include banner advertising, article writing, social networking and pay-per-click ads. Don't overlook offline marketing methods, such as articles and ads in magazines or newspapers, business cards, and direct response marketing.

Tips and warnings

  • Be sure to manage your database. Get rid of bad or outdated referrals, and make sure that the database is running properly.

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