4 Ways Small Trucking Fleets Can Build Strong Referral Programs
Listen to the article:
When it comes to making a good impression on potential hires, your fleet has limitations. You can only say so much in an ad, and your brand may not be that well known. There’s also the chance of truck drivers not believing what you are saying about your own fleet. It is an unavoidable downside to advertising. People do not always expect advertisers to be honest, and unfortunately, some advertisers are not.
It can be difficult to convince a driver you are the right fleet for them. However, there is a way to persuade them that has proven to be successful for many fleets. Let your drivers do the talking.
It’s a proven fact that people are more likely to listen to people they trust, and this applies across many industries:
- 92% of consumers trust referrals from people they know
- People are 4 times more likely to buy when referred by a friend
This same principle works in the trucking industry. A potential driver is more likely to believe what a peer says about your fleet than what you say about it. The power of ‘word of mouth’ plays a big part in your industry, and our research proves this:
Source: 2019 Truckers News Connectivity Study
Now that you’ve seen the power of ‘word of mouth’, how do you encourage your drivers to refer other drivers to your fleet? This is where referral programs come in.
Building a Strong Referral Program
Before we move on, I want to make sure we are working from the same definition of a referral program. What I am referring to is a way to track where referrals are coming from, while offering an incentive or reward to the person doing the referring. Many fleets have different types of referral programs in place. The key is to find what works best for your fleet, and there are a few ways to determine this. So, let’s take a look at 4 ways to build a strong referral program.
1. Know the Necessity of a Referral Program
We’ve seen the power of ‘word of mouth’. Refusing to leverage it equals missed opportunities. You may have a few drivers who are already speaking to potential drivers simply out of their enjoyment of working for your fleet. But providing drivers with an incentive is a great way to turn your employees into advocates who are actively helping to fill empty trucks.
2. Make the Driver Referral Worth It
Different fleets have different incentives/rewards they give to drivers who make referrals. The most common is a monetary incentive that ranges from hundreds of dollars (e.g. $500) to a couple of thousands ($1,000-$1,500 which is common for fleets). The key is to offer a desirable enough incentive to convince a driver the effort of talking about your fleet outside of work hours is worth it.
There are also many ways to distribute a monetary incentive. One of the more common ways is to pay it out over time e.g. Pay a driver in your referral program $250 when the driver they referred gets their first load and pay another $250 after the referred driver has been with the company for 60 days and so on. With a lot of referral programs, paying the incentive does not begin until the new driver has joined the fleet.
For further encouragement, some fleets make it a little more competitive by offering an extra bonus or extra paid vacation time to top referring drivers. There are fleets out there whose drivers are so encouraged by the extra income from a referral program that the money they make from incentives matches their driver pay.
3. Decide on the Best Incentive for Your Fleet
If you have never had a referral program before, it may be difficult to see its worth. You need to think of driver referrals as an investment and consider your return on investment. The hire you gain can make back the money put into the referral program in a short period of time—assuming they stay on as long as the average length of stay for drivers at your company.
So, to determine how much to put into your referral program, ask yourself this question: what can you pay a current driver to make referrals worth it? As I mentioned earlier, some companies pay $1,000-$1,500. Some pay $500. Some give rewards like paid vacation, etc. Determine what amount it will take to convince your drivers to talk about you with potential drivers out there.
Also, consider the hundreds of dollars being wasted every day a truck sits empty on your lot. Investing in a referral program is a strong way to put an end to that waste.
4. Remove Friction
It is important to make the referral program as painless and frictionless as possible. This encourages drivers to continue to make referrals, while making the program more appealing for drivers who are not a part of the program. A strong way to remove friction is to ensure the referring driver has one point of contact. This would be a recruiter who knows beforehand which drivers are referring new drivers to them.
Another way to remove friction is to make the process of keeping track of referrals well-organized and easy for a driver. Here’s how different fleets do it:
- Give drivers business cards so that when the referred driver calls or visits, they have the card in hand.
- Use an app that allows the new driver to fill out the form on your driver’s phone.
- Set up driver referral pages on your company’s ATS.
- Have referring drivers email a recruiter and copy the new driver on the email. This is probably the cheapest and easiest way to track referrals.
Benefits of Having a Referral Program
It Saves You Money
According to our research, the average cost-per-hire across the industry is $1,618. With that being the average cost of producing a hire, you would be saving money if you generated a hire through a referral program with incentives ranging from the hundreds to about $1,500.
It Says a Lot About Your Fleet’s Company Culture
Once you successfully get a strong referral program up and running, it becomes proof of how great your fleet’s culture is. If your drivers are out there talking about how good your fleet is and convincing drivers to come work for you, more and more drivers will see this and want to be a part of your culture.
You Are Getting Drivers Who Want to Work for You
By having drivers who enjoy working for you in your referral program, their positive experience with your fleet can cultivate interest in new drivers and convince these drivers to come work for you.
It Can Be Used to Increase Retention
It is likely that if you have your best drivers making referrals, they are looking for drivers similar to themselves i.e. similar work ethic, honest, etc. Have your good drivers out looking for good drivers and you will most likely be taking on new drivers who will stay as long as the drivers who referred them.
It is Proof You Appreciate Your Current Drivers
Having a way to reward drivers in your referral program shows them you value the work they are doing for you and the extra time they are putting into it.
Word of mouth is a powerful tool with benefits your fleet cannot afford to miss out on. Build a strong referral program to increase your chances of attracting good interested drivers. And don’t see it as taking a risk. See it as investing in and trusting your drivers to advertise for you.