Scott Young has had a referral program for about 10 years that, depending on the size of the project, pays installers $25 to $125 for every lead that results in a sale. But it isn't producing the results he'd hoped it would. “Our program doesn't seem to work well, and I'm not sure why,” says the president of Advanced Home Technologies, in Clintonville, Wis. “But we're still offering it.”

Many companies would dearly love for installer referrals to become a solid lead source. But it's hard to pull off.

If you're also stymied by the lackluster results of your installer referral program, consider this: “Before we instituted our program about two years ago, we'd sell $125,000 annually on installer referrals,” says Bob Dillon, president of Unique Home Solutions in Indianapolis. Through the first 11 months of 2007, the company's installer referrals jumped to roughly $900,000.

TRAINED TO REFER Under Unique Home Solutions' program, installers are paid 2% of every sale they refer. So if a referral results in a contract for $10,000, the installer earns $200. Installers also earn points for referrals, sales, and sales volume sold from their referrals. Each month the company hosts a bonus breakfast, and the installer with the most points earns a $600 bonus and a plaque. In October 2007, the winner generated $45,000 in business by producing 20 leads that resulted in 10 presentations and 4 sales.

How do Dillon's installers — who are all employees, not subcontractors — generate referrals? They're trained to keep an eye out for inquisitive neighbors and are provided scripts for approaching them. When they see someone eyeballing the job, they can open the conversation by saying, “Our company's offering good prices, and we have really good sales consultants who are happy to come out and give you an estimate.” If neighbors are interested, installers ask them to fill out a form giving Unique Home Solutions permission to call for an appointment.

REWARD IS KEY Southern Siding & Window Co., in Augusta, Ga., also offers installers a 2% commission on closed — and paid — sales from referrals, says sales manager Charles Gorse. But the company gets only about one sale a month from installers because Gorse's sales reps handle the neighborhood canvassing that brings in those leads. “They'll go check on the job, make sure customers are satisfied, and talk to neighbors the crew says have looked at the job,” he says.

Whatever method you use to generate leads from installers, Dillon says it's critical to reward their efforts. “For any behavior that I want to continue and improve, I come up with an award,” he says.