Referral Marketing Programs that Work

Most people—84 percent—trust recommendations from friends. Referral programs can tap you into that trust.

Referral programs are becoming a must-have marketing tactic for business-to-consumer brands. Word-of-mouth marketing is generally more targeted, because people trust people rather than advertisers. A recent Nielsen study shows that 84 percent of consumers trust recommendations from their friends.

Previous articles we’ve written on fostering customer relationships in social media and developing loyalty programs address how to engage and retain your customers. The next step: Using your loyal customer base to market your business through a referral program.

It is critical to create a strong referral marketing program that drives short-term customer acquisition and engages with new and loyal customers. Referral programs generate customers who are more profitable and more brand loyal.

Below is a step-by-step guide in developing a referral program that works for your business.

Create Compelling—Yet Smart—Referral Offers

To achieve the best results for sharing and purchasing transactions, your brand must craft a referral offer that is compelling and unique with a fair structure.

Creating a compelling referral offer combines art and science: You need to find the sweet spot wherein the customer values the offer and feels compelled to join your program to get it—and in which you don’t spend more on the referral deal than you gain through the revenue it generates.

Promote Your Referral Program

Promoting your referral program effectively and regularly is fundamental to its success:

1. E-mail Marketing: Launch your referral program with a strong e-mail campaign. Your campaign should have unique, engaging copy and images with strong calls to action.
2. Social Media: Use all appropriate social media channels to promote the program—and craft fun, attention-capturing posts that stay true to your brand’s voice and tone.
3. Promotional Placement across Your Site: Don’t be shy about promoting your referral program. Give it prominent placement on the homepage of your website—and on any other page that could drive registrations.

Make it Simple to Share

It is critical to ensure that consumers can easily share your referral program to drive more referrals and transactions:

1. Enable customers to share based on the brand, the product, and the services. This personalization drives control and increases conversion rates with current customers.
2. Provide a range of sharing channels. Ensure that consumers can make referrals through e-mail, personalized links, and socially through Facebook, Twitter, and LinkedIn.
3. Allow users to customize the share message. Provide a default share message with the option for the customer to customize it. A personalized message written by the customer performs stronger than default messages, but many customers prefer to use the default message—it’s easier—so it is important to offer both.

Want a few more ideas for building word-of-mouth marketing among your customer base? Read our article with three tips for building customer buzz.

Engagement

The landing page that the referred person sees when she clicks on the referral link should describe the details of the offer. It needs to be clear and transparent with a detailed description and the text on the page needs to be personalized and have a strong call to action.

Want help setting up a referral program for your business? Contact FrogDog.

Image courtesy of Stuart Miles/FreeDigitalPhotos.net