Optimizing marketing strategies with referral programs
In the present, companies are seeking to expand their businesses with different marketing strategies taking advantage of the available online tools. Utilizing these tools allows them to optimize their budget and acquire more touchpoints, therefore, more users.
An important marketing strategy that is acquiring a lot of power in digital channels is referral programs, as it is demonstrated that the results obtained with this kind of program are much more significant and sustainable through time.
According to LinkedIn, 84% of decision-makers start the buying process off with a referral. Referred prospects also convert 30% better than leads generated through other marketing channels and have a 16% higher customer lifetime value.
Referral Programs come in all shapes and sizes. An extensive budget is not required as digital tools and campaigns may require less monetary efforts as they can be optimized, in comparison to traditional marketing channels. It is important that businesses are aware of their main objectives before launching a referral program so that all actions taken are according to the program.
These are some recommendations for performing referral programs:
- It is important to reward your current users for referring a product or service to their friends or family. This will strengthen the relationship with them and will serve as an incentive for them to refer you several times.
- There are many ways to incentivize people. Some examples are gift cards, upgrades or product-based discounts. These incentives can make users more interested in investing with a brand and engaging with a product or service.
- Approaching with top users and offering them an extra incentive before asking them to push a referral program will inspire them to continuously invite more and more users by referring.
- Communicate your referral program across all your social media and online platforms, this will create homogeneity in your referral program campaign and will cover all digital touchpoints allowing more reach.
There are some referral programs that have succeeded. This has served as an example for other brands and businesses to implement and try out this strategy. For example, Traxalt, a digital asset, conjointly with bitfoliex, a digital wallet, have launched a referral program that incentivizes the referring user and the new user with a Traxalt airdrop for those people who open a new account in bitfoliex using a referral code. This is resulting in a bigger and stronger community of more than 970,000 users, benefiting all those involved.
Another successful example of a referral program in the past was implemented by Google, which consisted of rewarding business customers for each new user they sign up in Google Apps for Work. After joining Google’s referral program, users were provided with a link to share with their network so that when a new Google Apps for Work account was activated with that link, the referring user would get $15 as a reward.
Uber, the giant ride-share app, has also implemented a referral program for rewarding its users. It assigns each user a personalized referral code as soon as they activate their account. Every time a new account is created using the user’s referral code, both parties get their next Uber trip for free.
These are some successful referral program examples, that have resulted in positive campaigns and benefits for their users. There are other big brands that have also done referral programs across their communities such as Dropbox, ReadyTalk, Evernote, Tesla, and many others. Carrying a referral program campaign requires a well-structured plan determining the strategic touchpoints and fitting these with the objectives of the business. In a referral program, all parties end up being benefited, complying with everybody’s’ interests.
Disclaimer: This is a paid post and should not be considered news/advice.