As a shopper, you would have noticed the number of referral based offers that come your way. That’s because this strategy works very well in building loyal customers. However, there is a right time to get into it, and a few things to consider and set-up before taking the plunge. Remember, this is a full-fledged marketing campaign and requires a proper investment of time and resource in promoting it.
So how do you know you aren’t taking the leap prematurely or with lukewarm interest because you aren’t sure of what it really is? That’s what we explain in this blog.
To start a referral program, you first need to have a sufficiently large customer base. Secondly you need to determine the product fit. Thirdly, you need to remember that it doesn’t generate brand new customers as it mostly magnifies the word-of-mouth marketing. Which means that you must already have customers promoting your brand through word-of-mouth, and you must be making a high number of monthly transactions so that even if people don’t make referrals or if some forget about it, this endeavour doesn’t flop.
We assume people are already talking about your store. Typically, a referral incentive reads: when your friend shops with us using your referral code, you both get $x off. This motivates the shopper to get a friend to shop at your e-commerce store so they can both benefit from the incentive. The incentive must be tailored according to the needs of the shoppers. If it’s a product bought infrequently (like curtains) offer a cash incentive. If it’s something bought frequently (like food), then offer discount coupons for the next purchase. That way you are guaranteed two new sales!
Another aspect to pay attention to is the copy in your e-mails etc. that are promoting the referral program. You have to attract the attention of the reader here. This is a good place to introduce the character of your brand. For instance, a referral that reads: “Get a gift while also helping an underprivileged child study. Refer a friend. Your friend gets 15% off on their first purchase at our store. You Get 15% off on your next purchase.” This makes the referral something more than just another discount. It empowers the shopper to care for your cause, it lets them know that you aren’t just a money-churning business, and it makes them less cynical about you and more incline to shop with you again. And at the end of it, don’t forget a clear and straightforward call-to-action (CTA).
Like we said earlier, you have got to promote the referral program so that people are aware it exists. After all, it is a holistic marketing campaign.
If a referral works, you think it only means that someone liked your product and store experience sufficiently to want that incentive for the next purchase that they are certain they will make. However, remember that they are doing you a favour. They are taking a moment to carefully consider their friends, colleagues or family so see who would best benefit from the products you sell. They are doing the vetting for you.
But all in all, it shows that you have created something that they have been happy with want to share with others. And that is the basis for a good referral program to work!
"Looking for creative push notification ideas? Check out our free templates and start customizing!"