5 Ways To Ensure A Successful Referral Program
5 Ways To Ensure A Successful Referral Program
Referral marketing is the process of promoting products or services to new customers using word of mouth. Offering referral rewards motivates customers to frequently interact with your company, while opening up an additional revenue stream for your business.
According to the New York Times, referrals make up an incredible 65% of new business! A referral is a powerful marketing technique because it’s more trustworthy – it comes from a friend, a family member, or a coworker. These people are recommending a product or service because they like it, not because they have any kind of vested interest in the company. People who are referred by a friend are 4x more likely to buy from a business, and one offline word of mouth impression drives sales at least 5x more than a paid impression. According to Nielsen, 92% of people trust recommendations from family and friends more than all other forms of marketing. Put simply, referrals are more important than social media, advertising, emailing, and most other marketing campaigns, combined.
Clearly, referral incentives are a great way to influence and motivate positive behaviours that provide long lasting profitability for your business. However, referral marketing isn’t always easy. Recognising the importance of a referral program is only Step 1— the hard part is actually creating and operating your own program. So where do you start? In order to be successful, your company needs an active approach to referrals. Here are 5 ways that you can ensure a successful referral program.
- Spread The Word
One area that companies seem to overlook when trying to launch a successful referral marketing campaign is customer awareness. No matter how good your referral rewards are, if you customers are not aware of the program, they won’t use it! Make your referral program easy to notice by pushing it everywhere the customer might look, such as opening menus, banners, invoice reminders, and more. Another great way to push referrals is to tie them in with a happy or enjoyable moment a user might experience, such as after purchasing a product, winning a game, or having a problem or issue resolved by your team. Use your company resources to your advantage by promoting the referral rewards program on your blog, social media, email lists, etc. 81% of U.S. online consumers make financial decisions to purchase or donate as influenced by friends’ social media posts.
Timing is also important. Asking for a referral without first being familiar with your customer–and without them knowing or caring about your product or service–is not going to lead to an increase in sales. Develop a relationship with your user base before you try to get them to sell something. Prove that your brand or product is something they will value first.
- Offer Rewards That Actually Matter
If you want people to recommend friends and family, you have to give them a worthwhile reason to do so. Your company must offer something of value, while at the same time expressing to the consumer that they are valuable. The more your customers feel appreciated, the more likely they’ll be to spread the word about your brand out to their own networks. Not all consumers want the same incentives or prizes, however, so it’s important to understand what motivates each one of your users.
Offering meaningful rewards creates another point of differentiation from your competition and opens another channel to create strong relationships with your customers. TruCash Prepaid Incentive Cards are a great way to influence and motivate positive behaviours that are profitable for your business. Offering rewards that can be used how and where the recipient wants eliminates the challenge of trying to find rewards that your customers will appreciate. The unique online platform offers flexible value-added, customer centric functionality with more security, accountability, and manageability features than any other loyalty program in the world. Avoid extra costs associated with traditional programs, use TruCash Prepaid Cards and easily distribute, track and manage your rewards program today.
- Make It Easy
Getting your users interested in making a referral is only half of the battle. If you make your user take unnecessary steps to participate in your referral program, you’re going to have issues with program abandonment. Remember, your users don’t know how to sell your product better than your own marketing team. Make it easy for them to share the referral offer. For example: don’t make your users go through multiple pages to share a link on social media. You need to make that process as simple as possible. And, if possible, don’t make your user create a whole new account just to send a referral.
It’s also equally important to make it easy for your team to operate the referral program. TruCash’s web-based program ensures the process is incredibly simple for sales professionals to grow and manage their referring customer base. It is easy to track and measure results of the program, as well as the activity of the sales team. Whether you’re launching a new product, having event giveaways, promoting a contest or offering corporate gifts and awards, TruCash Prepaid Incentive Cards are an effective way to increase customer loyalty and manage incentive programs.
- Twice the Benefit, Twice the Reward
The best kinds of customer referral programs are those that benefit both parties–the referrer and the referee. Many users aren’t interested in trying to make a profit off their own friends or family. The referrer is far more likely to talk about the program to friends when everyone is benefiting, not just themselves. The double-sided rewards makes both parties equal. A double-sided incentive will increase both the number of referrals and the conversion rate of a referred visitor to a registered user. The feeling of helping out a friend or family member will further strengthen the bond between your company and your user base.
One only needs to look at the success of huge companies like AirBNB, Uber, and PayPal with their double-sided referral programs to see how successful this can be. This is especially true for start-ups looking to break into a market.
5. Say ‘Thank You’
Last, but certainly not least, remember to thank the user after each referral that is made. The job isn’t over once a referral is made! Don’t treat the customer like a number – you must continuously nurture your business-to-user relationship, as well as the referrer-to-referee connection, especially if you want that referee to eventually begin referring. Something simple, like an email or small reward, can go a long way towards building long-term relationships and encouraging more referrals. Remember, referral marketing generates 3-5x higher conversion rates than any other channel. Use it effectively and the return on investment will quickly become evident.
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