Anyone who manages a customer reference program knows all too well that the darn thing requires a bit of commitment.

The bright side is, customer reference programs can also be extremely rewarding from a return-on-investment perspective. But how do you know if all that commitment is actually leading to a positive ROI? Key performance indicators, my friends. Yes, KPI’s.

As someone who helps pull together reports on our own customer reference program, I thought I’d share the metrics we track on a regular basis to report on the progress and success of our program efforts.

But first, let’s go back to basics for a second…

“Count what is countable, measure what is measurable, and what is not measurable, make measurable.” - Galileo Galilei

What is a KPI and why should I care?

A key performance indicator, or KPI:

  1. Must be in line with organization goals
  2. Is defined with (or by) management
  3. Provides context
  4. Creates meaning on all levels of an organization
  5. Is based on good data
  6. Is easy to understand
  7. Leads to action
  8. Must regularly be reviewed
  9. Must be updated as organizational goals change

Now that you’ve got a basic understanding of what a KPI is, it’s important you participate in helping define your organization’s KPI’s for your customer reference program and know how to best track them. Why? Because when your boss or CEO asks the ultimate question that decides if your program makes the next budget cut or not, “did this program deliver a return on investment?” you don’t want to be floundering. Proving the value of a customer reference program to executives comes down to showing measurable, quantitative, trackable results.

Here are a few quick tips for starting your list of KPIs:

1. Focus on a Few

Base KPIs on your company’s business and strategy, but only focus on a few metrics. By trimming KPIs to a core set of performance metrics, you can help your customer reference organization eliminate noise and enhance focus.

2. Look Forwards and Backwards

Use both leading (forward-looking) and lagging (backward-looking) indicators to determine the metrics that will be most important to track success of your program.

3. Don’t Be Static

Review, reevaluate, and revise KPI’s based on changing environment and organizational goals.

Customer Reference KPIs to Track

Okay…now that the basics are covered, we can jump into the good stuff! Let’s go through some of the KPI’s we track in RO’s own customer reference program, and perhaps a few more that you might think about tracking in your own organization. These are of course just examples to give you a better idea of where you might track your KPIs, there are lots more and you need to tailor to your company’s goals and program status.

1. Reference Program ROI

The Holy Grail and core of assessing and evaluating your program is to find out what impact it’s having on the business via direct revenue influence. Everyone thinks about this, and everyone understands the nature and importance of this, but from an inEvidence survey from 2012, only 36% of companies cannot accurately measure the ROI of their customer reference programs. Start tracking metrics and you may be surprised at the high ROI on reference activities.

For example, because of our reference platform’s integration with our CRM here at RO, we can easily measure the number of deals that were closed (new business + cross-sells/upsells), the dollar value of those deals, and the customer references that were used to help close those deals. As part of this process, we don’t just track these key metrics of references provided against deals closed, but we also conduct surveys and capture feedback from the requestors and the references themselves on their experience of the reference event. This feedback is helping us really understand the value of our program and the impact our efforts are having on actually closing business.

2. Growth of Program Usage

This is a great KPI to help determine adoption and awareness of your program or database within your company. Metrics to look at in this area include the actual number of sales reps, marketing users, etc. accessing your reference database (or perhaps sending requests to you directly) and the growth rate of that number over time.

3. User Department Breakdown

It’s also good to know exactly WHO is using your program, or who your main stakeholders are. You may have set the program up thinking sales would be the main users, but then come to find out it’s actually marketing – or vice-versa! This helps you cater your program’s assets and functionality to the main user group audiences, and help you flag any areas or groups where you may need to readdress or add more training to increase adoption.


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4. Customer Participation Breakdown

Obviously a customer reference program is no good unless you have a number of reference participants to call upon for requests. You should be measuring the percentage of your customer base who participate in some form of reference activity, and if that number is growing or shrinking.

5. Top Used Assets/References

It’s key to keep a thumb on the pulse of what customer references and asset types your program stakeholders using/accessing/downloading the most. This helps determine if you’re hitting demand, or falling short, and where to put future effort. It also gives great insights to knowing how relevant your program is to stakeholders based on their actions with your program.

6. Reference Conversion Rate

This KPI goes somewhat in tandem with the revenue ROI KPI mentioned earlier. This one looks at how many of your used references converted opportunities into either a sales win or sales loss. While it’s understood references are not the sole determining factor for a sale win/loss, it is helpful to take a look at any trends so you can act accordingly and make any needed tweaks to your program.

7. Net New References

As a reference manager, it’s important to not only look at the total number of new customers you’re adding to your reference program (and if it’s growing, shrinking or staying steady), but also new references by type/industry/solution/geo, etc. This helps prevent your program from becoming stale, and adds to the currency and variety of references you can continually call upon to fulfill requests and prevent reference fatigue.

8. Filled vs Unfulfilled Requests

This is a KPI that showcases both the demand and relevancy of your program. It helps you determine if the references you have in your database are current and on-point enough to ensure you can fulfill every request or not. It can also help you recognize and determine major gaps in your reference database.

9. Reference Request Completion Rate

I once talked to a sales rep from another company who joked he’d go gray before he got his reference requests fulfilled. I hope he wasn’t talking about your program! Looking at the time it takes from initial request receipt to fulfillment is a metric that will help you determine the effectiveness and efficiency of your program.

10. Reference Demand by Type

Again, this KPI is one that showcases demand and relevancy of your program. Look at the types of references being requested (i.e. phone calls, speak with analysts, speak at event/webinar, case study candidate, etc.) as well as by geo, industry, product, etc. This helps you see what types of references are most popular/you need the most of, as well as see where your program may be a little weak.

11. Ease of Use/Time Saved

Track the steps and time it takes for someone to find or request the correct reference or reference asset. Also analyze the number of questions stakeholder teams have about the reference program/platform. This will help you determine if your program is helpful/useful to them as well as if your program is adding value by improving the efficiency of their workflows in their daily jobs.

12. Overall Nomination Conversion Rate

Again, a reference program risks becoming stale without new reference customers being added to it on a regular basis. So look at how many reference nominations are in the queue (is it growing, are you going to hit your goals?) as well as how many of those nominations convert to become legit references in the program.

13. Nomination Conversion Rate by Source

Along with volume of reference nominations, you should also be analyzing the quality of sources. Are nominations from sales reps converting twice as fast as nominations received through customer satisfaction surveys? Knowing where to focus effort can make a big difference in recruiting higher quality candidates to your program.

14. Customer Reference Burnout Rate

While it’s great to know how many customers you’re adding to your program on a regular basis, it’s also important to look at how many are leaving your program. This can raise any red flags about types of customers that may not be good fits for your program, or get overused too fast so you can adjust how you are protecting and managing these valuable relationships better.

15. User Satisfaction Ratings

Survey your internal user team and get some feedback on how happy they are with your current customer reference program. Do they find it useful? Is it relevant? What needs improvement? Even if it’s a small sample size, this data can be extremely useful for making sure your program stays afloat and is successful in the long run.

16. Customer Satisfaction Ratings

Similarly, you’ll want to ask your current customer reference base if they find value in your program. What can you do to ensure they have a stellar experience and want to continue being a reference for years to come? Do you need to over different incentives or more frequent communications? Are they happy with their role as a reference? Again, this kind of feedback helps you make any necessary tweaks to your program to ensure success long term.

Common KPI Pitfalls

While it’s great to have KPIs and metrics, and all that jazz, it’s also important to not get in over your head. Know where the KPI landmines are and how to avoid them.

Measuring without a goal in mind – One of the most common mistakes we see in companies taking metrics is NOT measuring against goals. What we mean by that is they just jump right in. “We need to start a recruiting program” or “We need to go out and get nominations” and they don’t have a target or goal in mind, so their efforts and messaging is not very focused and they don’t really have anything to measure against that would define success or failure for a KPI.

Not answering the “so what?” – Another mistake I see is companies “measuring” basic numbers. We’ve got 15 references in financial services, 10 in Product A, 17 for North America, 30 case studies, etc. My response to that is always, “so what?” it’s good to know how many you have, but it’s more important to know how many you need in each of those areas. Again it goes back to the gap analysis that was mentioned earlier. Remember, it’s not just about measuring activity…it’s about measuring effectiveness!

Focusing only on financial – It’s not all about money. Not all KPI’s need to be (or should be) financial. As we exhibited above, there are many qualitative metrics that help determine impact and success of a reference program.

Too Many KPI’s – Avoid “paralysis by analysis.” Again, look at what your organization’s major goals and initiatives are. If you really only need to track a handful of metrics versus the whole nine yards, do it! Every company and program is different, so sometimes it’s best to keep it simple!

Hidden KPIs – Once you’ve got some solid data in your hands, don’t keep it to yourself! Make sure you put your reports in the hands of those who need it. Because really – what good is a KPI if it’s kept a secret!

When it comes to proving KPIs and tracking the ROI of your customer reference management program to executive management, identifying and capturing the right data, then constantly reporting on and promoting your program’s progress is the key. A disciplined approach to reporting your program’s performance, coupled with presenting the information in meaningful, easy to digest indicators for the executive team means that you not only will strengthen your customer reference program year over year, but also increase your budgets with amplified executive support.

For help in determining some of your KPIs, or tracking and presenting them in a meaningful way, please contact the RO Innovation team at info@roinnovation.com. We’d be happy to help you showcase how stellar you actually are at managing a top-notch reference program today!

Nichole Auston
Nichole Auston is the Director of Marketing at RO Innovation. With a background in digital marketing and nearly a decade of experience managing marketing programs for a variety of SaaS companies, she’s passionate about sharing insights, best practices and stories about sales enablement and customer reference management, and the people and technology that power it.
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