In short: Yes! You could literally be making money while doing *almost* nothing.

This is precisely why we’re going to explain why and how you should be leveraging the power of affiliate marketing to drive online revenue.

And the best part?

If you’re using Shopify, you’re in luck because this e-commerce platform already has a directory full of Shopify affiliate marketing apps to choose from and we have rated and reviewed the best of the best.

In this article, we’re going to:

• Introduce you to the benefits of affiliate marketing.
• Showcase our top Shopify affiliate marketing apps.
• Go through the steps you need to take when setting up your own affiliate marketing program.

Let’s jump right in!

Quick Comparison: Top Shopify Affiliate Marketing Apps

Here’s a quick review of the best Shopify affiliate marketing apps, how much they cost, the pros and cons of each and our P2P rating. For more details, we have a comprehensive review below.

What is Affiliate Marketing?

Essentially, affiliate marketing uses individuals to promote certain brands and products in order to receive a commission on each sale that they refer.

Affiliates can be literally anyone from existing customers to influencers or other small marketing businesses, and they can promote a product through blogging, social media, or email among other methods.

The brilliant thing about affiliate marketing is that it’s a win-win situation for both parties. Affiliates earn a decent commission for their referred sales, clicks, or leads, while merchants enjoy a fairly low risk sales and marketing effort that can scale easily.

Incentives don’t even have to be cash payments because affiliates can also receive freebies or discounts in exchange – it really is that flexible.

For ecommerce businesses, this makes even better sense because you can also track the performance of your affiliates easily with an affiliate management solution.

The Benefits of Affiliate Marketing

In the U.S. alone, affiliate marketing spend reached 8.2 billion U.S. dollars in 2022, up from 5.4 billion recorded in 2017 according to Statista.com. This steady growth is set to continue and it is safe to say that affiliate marketing is well-worth investing in. 

Affiliate marketing has also taken on a new life as the trend of influencer marketing has somewhat burst its own bubble, and marketers are going back to ‘old-school’ measurable marketing methods. Influencer marketing has now fallen under the umbrella of affiliate marketing.

So, what are the most important benefits of affiliate marketing for ecommerce?

1.Scale Quickly with a ‘Remote’ Sales Team

As a small business, it’s highly likely that you are your own sales team! Or you might have a small core team, but expanding is a costly affair.

Affiliate marketing allows you to connect with and reach many more people who will be selling or promoting your product in a short amount of time. Plus, with affiliate marketing, you only pay per conversion so you’ll steadily increase your ROI.

2.Affiliates are Focused on the Job

There are no lengthy processes involved in making a sale because affiliates are focused on the job – it’s their source of revenue so they are determined to generate revenue for you. This frees up a lot of time you would’ve otherwise used in managing an in-house sales team, so you can focus on growing your business.

3.Multi-Channel Marketing

Affiliates will use any channel that works for them and for you. Therefore, you don’t have to get caught up in highly produced digital ads or campaigns.

Your affiliates could generate both brand awareness and conversions from multiple channels such as social media, email, online reviews, or blogging.

4.Leverage Word-of-Mouth Marketing

74% of consumers identify word of mouth as a key influencer in their purchasing decisions.

Your affiliates are people, and you can leverage their reach and influence easily through an affiliate program.

5.Easy to Measure and Manage

Using shopify affiliate marketing apps makes tracking and measuring your campaign a breeze – because it’s all updated in real time and purposely built to integrate with your store.

With unique tracking codes for each affiliate, you’ll be able to easily track sales and pay out commissions – this can even be automated if you use the right tool.  

Now that we’ve got you thinking about all the marvelous benefits of affiliate marketing, let’s get right onto our list of the best Shopify affiliate marketing apps you should be using.

11 Best Shopify Affiliate Marketing Apps

1.Refersion

Refersion is one of the major players in affiliate marketing, and their end-to-end shopify affiliate marketing app brings together all those world-class features in one robust tool.

The app allows you to recruit, manage, and pay your affiliates with a personalised dashboard. Their shopify integrations allow you to automatically create unique coupon codes so you can track sales from any channel.

Pros:

• End-to-end shopify affiliate marketing
• No coding required
• Easy to launch
• Customisable affiliate commissions at product-level

Cons:

• Lowest tier is out of reach for many small businesses
• Only tracks up to 130 affiliate orders p/month
• US-based support only

Price:

• Free Trial: 14 Days 
• Paid Plan: $99 /month 

Website: refersion.com

Shopify App Store Rating: 4.7 Stars / 761 reviews

2.UpPromote: Affiliate & Referral

UpPromote: Affiliate & Referral is an ideal option for all-size businesses. Especially, the app offers free plan if you’re looking to start your Shopify affiliate marketing strategy without any upfront cost.

You can easily group your affiliates in program(s) with a specific commission structure. Also, you can setup auto-tier commission and lifetime commission to incentivize your team.

The app supports you to build an affiliate team with unlimited affiliates on all plans. Furthermore, you can convert customers into affiliates via a post-purchase popup, or let affiliates invite others with multi-level marketing (MLM) feature. What differs between UpPromote and other apps is that you can list your offer on UpPromote marketplace to approach more ambassadors.

Pros: 

• Free plan available
• Easy to set up
• No coding required
• Access to UpPromote marketplace to reach even more potential affiliates
• Offer multiple commission programs, life-time commission, auto-tier commission
• Pay your affiliates AUTOMATICALLY via PayPal integration, or pay store coupon using Store Credits

Cons:

• Limit approve/ deny the amount of referral orders for free plan.

Price:  

• Free Trial: 14 Days 
• Grow Affiliate: $29.99 per month
• Professional: $89.99 per month
• Enterprise: $199.99 per month

Website: uppromote.com

Shopify App Store Rating: 4.9 Stars / 1342 reviews

3.Social Snowball

Social Snowball is an automated affiliate marketing app designed specifically for Shopify stores. It automatically converts all store customers into affiliates and encourages them to promote your products by assigning personalized promo codes/links.

Moreover, Social Snowball shows the coupon code at the end of each purchase, on the “Thank You” page, making customers more likely to share the product they just bought.

We particularly like their minimal approach to everything. For example, the affiliate forms Social Snowball creates for non-customers (who’d like to join your affiliate program) can be filled in a few seconds.

You can pay your affiliates in two clicks using one of the six simplified payout methods. And its minimal dashboard lets you keep track of everything.

Pros:

• Free plan available – unlimited affiliates
• All customers become affiliates automatically
• Easy to set up for Shopify merchants
• Easy for affiliates to join the affiliate program made with Social Snowball
• Personalized coupon codes make users more likely to share your products.
• You can pay your affiliates in two clicks!

Cons:

• On the FREE plan, you’ll have to pay 15% of the revenue generated by Social Snowball.

Price:

• Free Forever
• Snow Day: $99/month
• Blizzard: $499/month

Website: SocialSnowball.io

Shopify App Store rating: 5.0 stars / 32 reviews

4.LeadDyno

As one of the most popular Shopify affiliate marketing apps around, LeadDyno is a favourite among small businesses. A really great benefit of using LeadDyno is that you’ll not only get to use a great marketing tool, but also gain access to their large affiliate network for free.

Pros:

• Unique affiliate dashboards
• Mobile app for affiliates
• Free access to their affiliate network

Cons:

• US-based support only, and this can lead to delays in responses
• It requires some level of technical-savviness to set up
• The first tier might be a little pricey for small companies

Price:

• Free Trial: 30 Days 
• Starter: $49 /month
• Plus: $129 /month
• Pro: $349 /month
• Premium: $749 /month

Website: leaddyno.com

Shopify App Store Rating: 4.5 Stars / 569 reviews

5.GoaffPro

GoaffPro is a great choice if you’re just starting up because their shopify affiliate marketing app offers quite a generous free plan. You can convert existing customers into affiliates through a customised portal, set up product-level commissions, track sales through multiple methods, generate coupons, and manage payments through PayPal.

Pros:

• Generous free tier allows you to run a full affiliate program
• Unlimited affiliates, and uncapped revenue
• Create and send welcome emails
• No coding required

Cons:

• Some customers noted a slow response time to queries
• The jump from free plan to the paid option could become a costly upgrade for some

Price:

• Free Forever
• Premium: $24 /month

Website: goaffpro.com

Shopify App Store Rating: 4.8 Stars / 376 Reviews

6.ReferralCandy

Referral marketing is part of affiliate marketing. Others might argue that it is a separate strategy, but we’d like to think of it as part of the affiliate marketing landscape.

What differs between referral and affiliate marketing is the relationship between the referrer and the end customer, these two are usually connected by family, friendship or other shared interests. Other than that, referral marketing works the same as affiliate marketing.

ReferralCandy is one of the most popular choices among shopify affiliate marketing apps and they are a pioneer in the affiliate marketing space. To date, they’ve generated millions of dollars in referral sales, so if you’re looking for a “Rolls Royce” of apps, this is one of them.

ReferralCandy also offers an affiliate marketing mode so you can also reach out to affiliate partners.

Pros:

• Powerful end-to-end affiliate marketing features
• Fully customizable emails with pre-designed themes
• Automated payouts
• Customizable incentives (discounts, cash payouts, gifts etc.)
• Detailed, deep analytics
• No coding required
• Built-in Affiliates Mode to reach out to influencers

Cons:

• The steep starting fee might be out of reach of smaller companies
• Customizing certain templates does require a certain level of tech-savviness and might not be very intuitive to use

Price: 

• Free Trial: 30 Days 
• Premium: $59 /month
• Plus: $299 /month

Website: referralcandy.com

Shopify App Store Rating: 4.9 Stars / 813 reviews

7.Affiliatly

Source: Shopify

Affilatly allows fully customizable affiliate management software. With this Shopify affiliate app, you can create custom links to let your affiliates share your products with ease. This platform lets you build branded registration forms and get email notifications to stay ahead of your program.

Pros:

• The customer support is helpful and responsive
• The free trial is much longer than other platforms
• You can track royalties and other custom partner programs

Cons:

• Poor online resources
• There’s no database of affiliates 

Price: 

• Free Trial: 90 Days 
• Starter: $16 /month
• Advanced: $24 /month
• Pro 1000: $59 /month
• Pro Unlimited: $129 /month

Website: affiliatly.com

Shopify App Store Rating: 4.7 Stars / 121 Reviews

8.OmniSTAR

Source: Shopify

Providing affiliate management software for aviation businesses, agriculture, mining, and railways, OmniSTAR is a basic Shopify affiliate marketing app. With one paid plan, this software is ideal for startups. The configuration is quick and easy, and the super responsive customer support is available 24/7.

Pros:

• Quick and easy configuration
• The customer support team is responsive and helpful
• Users find the features highly valuable
• The pricing is affordable 

Cons:

• You may find a lot of technical issues with this platform

Price: 

• Free Trial: 15 Days
• Basic: $47 /month

Website: omnistar.com

Shopify App Store Rating: 4.7 Stars / 32 Reviews

9.MLM

Source: Shopify

MLM by ShoutOut is a completely free affiliate marketing software with basic features. This beginner-friendly affiliate tool lets you manage and pay your affiliates with ease. While this isn’t the top platform for high-level affiliate management, it’s ideal for individual marketers and startups.

Pros:

• Many users say this app makes complicated tasks easy
• The interface is clear and appealing
• You don’t need technical knowledge for this platform
• It’s the perfect app for marketers 

Cons:

• You may run into technical issues
• It’s too basic for high-level campaigns 

Price: 

• Free Forever!

Website: shoutout.global

Shopify App Store Rating: 4.6 Stars / 83 Reviews

10.Simple Affiliate

Simple Affiliate is one of the best Shopify affiliate marketing apps, and all it’s users agree! Boasting five stars, this platform is seamless to use, and you can launch your campaign in a few minutes. The customer support is superb and so are the features. This platform is 100% in-house so you don’t have to manage your affiliates through external portals. 

Pros:

• This app is easy to use and navigate
• Super friendly and responsive customer support
• It’s easy to customize this app

Cons:

• The software tends to lag 

Price:

• Free Trial: 14 Days
• Basic: $14 /month
• Professional: $29 /month
• Enterprise: $249 /month

Website: simple-affiliate.com

Shopify App Store Rating: 5 Stars / 32 Reviews

11.Buzzbassador

Source: Shopify

Buzzbassador is one of the most favorable Shopify marketing apps for micro-influencer marketing campaigns. You can forget messy forms, and focus on branded registration forms that drive quality affiliates. Businesses can track their campaigns in real time and send payments effortlessly. 

Pros:

• The functionality is amazing 
• It’s easy to configure and edit your campaign
• Users say the customer support is impeccable 

Cons:

• The user interface is complicated 

Price: 

• Free Trial: 14 Days
• Launch: $39 /month
• Build: $79 /month
• Scale: $229 /month
• Plus: $499 /month

Website: buzzbassador.com

Shopify App Store Rating: 4.9 Stars / 89 Reviews

5 Steps to Build Your Affiliate Program in Shopify

With so many apps offering “one-click” options, it’s becoming even easier to get started with affiliate marketing on Shopify. However, there is some groundwork that needs to be done to really make the most of your marketing tools.

Here are a few important steps to keep in mind when you’re building your affiliate program:

1.Outline How Your Affiliate Marketing Program Will Work

Define what your sales and marketing objectives are and what kind of affiliate commission you are willing to offer. This can be discounts, free products, coupons, or other incentives.

Then look at what kind of budget range you can afford and what features are a high priority for you.

For some businesses, all they need is a straightforward affiliate marketing tool, while others might require additional communication features such as bulk emailing, automatic payouts, custom dashboards and so on.

Once you get your wish list of features and have defined your commission structure, you’ll be able to pinpoint the right app for you.

2.Pick the Right Affiliate Management Tool

Now that you’ve outlined your basic affiliate strategy, it’s time to find the right marketing tool. Here are a few quick ways you can start researching:

• Look at what tools your competitors are using
• Read online reviews and ratings
• Sign up for trials and demos to get a better sense of how the tools work and judge your comfort levels

Once you’re ready to trial or purchase an app, you simply have to login to your Shopify account, navigate to your chosen app’s listing page and click on “Add app” – then follow in the instructions to set up.

3.Set Up Your Communication Plan

Decide on how and why you’ll be communicating with your affiliates.

Email communication is usually the best way to onboard new affiliates and keep in touch throughout the campaign.

Certain emails can be automated through your Shopify affiliate marketing app, and some require more of a personal touch (such as onboarding emails, customer support, payment queries and so on).

You can also promote your affiliate program on social media, on your website or by other marketing channels.

4.Recruit Your Affiliates

With the right tool in place, you can start to recruit your ideal affiliates.

It’s important that you clearly define what criteria you’re looking for and what you are willing to pay out, and what you are paying out for: sales, clicks, leads, and so on.

You can use your affiliate marketing app to find affiliates on their owned networks, or you can start with your own customer base (as with referral marketing).

5.Track, Measure, Manage and Optimize

Track performance and manage your affiliate program with ease using the dashboard provided by your affiliate marketing tool.

Using the analytics and insights you receive through the app, you can optimize your affiliate program even further.

Final Thoughts on Shopify Affiliate Marketing

While having a diverse marketing mix is always a good strategy, we really believe that affiliate marketing should be a big part of that effort.

While there are quite a few apps that perform similar tasks out there, it’s important to get the most out of your monthly fees. Therefore, we recommend doing your research on each app.

Use articles like these to help you narrow down the search, and sign up for as many free trials and software demos as possible to give you the best opportunity to “try before you buy”.

Our Top Picks from Our Review of the Best Shopify Affiliate Apps

For small businesses just starting out: GoaffPro for their generous free plan.

For enterprise-level businesses, looking for a robust end-to-end solution: Refersion for their established, fully end-to-end Shopify affiliate marketing offering.

References

99Firms: 23 Affiliate Marketing Statistics to Help You Up Your Game

BigCommerce: Word of Mouth Marketing How to Get Happy Customers to Advocate for Your Business

E-commerce CEO: E-commerce Affiliate Marketing: The Ultimate Guide 

Refersion: Can You Do Affiliate Marketing on Shopify? 

Shopify: Affiliate Marketing: How to Turn Product Recommendations into Passive Income 

The post Shopify Affiliate Marketing: 11 Best Apps + Full Guide for 2024 [Updated] appeared first on P2P marketing.

You can consider peer-to-peer marketing as a form of word-of-mouth marketing, which relies on factors such as customer appreciation to work. 

This detailed guide covers everything you need to know about peer-to-peer marketing, including eye-opening statistics and the best strategies to use for your business.

Are you wondering how to leverage peer-to-peer-marketing to get ahead of your competitors and multiply your profits?

Continue Reading!

What is Peer-to-Peer Marketing?

Firstly, it’s crucial to understand that peer-to-peer marketing is not networking. Instead, you encourage your current stakeholders to direct their peers to your brand by advocating your products/services to them.

Peer-to-peer marketing allows your employees, customers, investors, and partners to become marketing channels. Your company will employ various strategies to appeal to them and provide them with reasons to recommend your company.

Secondly, peer-to-peer marketing is a form of word-of-mouth, but the two practices have their differences.

Word-of-mouth is when stakeholders tell their friends, family, and co-workers about a product they like. Sharing this information is triggered by great customer experiences.

Word-of-mouth is a natural activity that relies on casual social interactions to work. It’s also one of the most organic and effective forms of marketing.

Let me give you an example of word-of-mouth marketing in your daily life:

You call an insurance company for a quote, and the customer experience is unforgettable. The company didn’t keep you on hold for over 30 seconds, and the consultant completed the quote in a matter of minutes. 

That exceptional experience will trigger you to mention it in the most mundane conversations. Without realizing it, you’re helping businesses gain five times as many sales, compared to media advertising.

On the other hand, peer-to-peer marketing describes when a company encourages its stakeholders to advocate their products/services.

In other words, this is an encouraged marketing activity where you (the company) initiate your stakeholders to tell their peers about your product/services.

Let’s explore an example of stakeholder or employee advocacy:

In this case, you are the insurance company. By creating an employee advocacy program, you can offer your employees rewards or benefits to promote your offerings to potential customers.

Before you know it, you’ll have broadened your consumer base, developed a strong workforce with high morale, and maximized your bottom line.

Unlike the example of word-of-mouth-marketing, for peer-to-peer marketing, stakeholders are actively encouraged toward your desired action.

But for word-of-mouth marketing, stakeholders naturally mention a great customer experience to their peers.

Peer-to-peer marketing definitely impacts a business. But why is this true? 

Why Does Peer-to-Peer Marketing Work?

Peer-to-peer marketing is effective because people trust recommendations from those closest to them. Referral Candy confirms this by stating that consumers trust recommendations from friends 7 times more than conventional advertising. 

This makes perfect sense. As a consumer, think about how you feel when you see advertisement campaigns. Immediately, you feel like that company is trying to sell something. Therefore, their opinion of the product/service must be biased.

But, if someone you trust is raving about how astronomically amazing that company’s products/services are, you’re more prone to trust that opinion because it seems unbiased. 

When your stakeholders tell their peers about your brand, it comes off as genuine because that person is not paid to advocate for your products.

This marketing method also helps you acquire user-generated content to appeal to your target audience and provide valuable social proof. 

However, if you’re still on the fence about peer-to-peer marketing, let’s have a look at what the numbers say….

20 Statistics on Peer-to-Peer Marketing

1. 56% of consumers are influenced by their peers while shopping. Source
2. 41% of consumers trust a recommendation from their peers more than social media. Source
3. Consumers casually discuss brands over 90 times a week. Source
4. 84% of consumers confirm they always or sometimes take action on personal recommendations. Source
5. 81% of US consumers are influenced by what their friends share on social media. Source
6. User-generated content rather than brand images or videos appeals to 85% of website visitors. Source
7. Peer-to-peer marketing drives 20-50% of all purchasing decisions. Source
8. After a friend or family member shares a product over social media, 67% of consumers confirm they are more likely to purchase it. Source
9. A shocking 97% of IT professionals get recommendations from their peers before making a purchase. Source
10. Consumers are 4 times more likely to purchase from your business if they’ve been referred by a friend. Source
11. Now, this statistic is going to surprise you – 80% of all Business-to-Consumer (B2C) and Business-to-business (B2B) purchases involve some degree of WOM marketing. Source 
12. 49% of consumers explain that their top source of brand awareness is friends and family. Source 
13. Customers who are generated through their friends referring them are 18% more loyal than customers gained through any other channel. Source
14. When a friend or family member recommends a product/service, that is more likely to influence a purchase by 50%. Source
15. 82% of consumers go out and find recommendations from their peers before purchasing. Source
16. User-generated content receives 28% more engagement compared to standard posts. Source 
17. 21% of millennials won’t try a product if their friends don’t like it. Source 
18. Think your online ad is convincing the masses? Think again, as only 33% of customers believe in online ads. Source
19. You can increase your sales by 500% through an offline WOM impression compared to an advertising impression. Source
20. 55% of consumers share positive experiences with businesses on social media. Source

The Takeaway

From these statistics, it’s reasonable to say that consumers are looking for user-generated content as an encouragement to purchase from your store.

Peer-to-peer marketing is also a reliable source for authentic user-generated content. And this, as statistics prove, is one of the strongest sales methods. 

Most consumers rely on peer-to-peer marketing as it drives 20%-50% of all purchases. And 82% of consumers proactively find recommendations before purchasing a product. 

Furthermore, leads that are peer-to-peer referrals are 18% more loyal than customers gained through other channels.

This proves that peer-to-peer marketing not only focuses on lead generation and optimizing your profit margin, but also solidifies brand loyalty. Which could later open opportunities for gaining brand ambassadors for your business. 

Also, social media reaches so many stakeholders simultaneously and is used to advocate products/services for brands.

These reasons, amongst many more, make it essential for brands to partner up with social media influencers and affiliate partners.  

Keep reading to find out how influencers and affiliates play an essential role in your peer-to-peer marketing strategy.

7 Peer-to-Peer-Marketing Strategies & Examples

1.Identify Your Target Audience

We’ve already covered that peer-to-peer marketing encourages your stakeholders to drive more stakeholders to your business who are your ideal buyers.

But for this to work, you first need to identify who your ideal buyer is. The more data you can gather on your target audience, the easier it will be to create content that is personalized to them.

Your target audience only has an attention span of 8 measly seconds. And if you tailor your content and products/services to their needs, pain points, and objectives, you can quickly grab their attention. 

Find out everything you can about your ideal buyer persona, including:

• How your products/services can solve their challenges.
• Which social media platform are they active on?
• What kind of marketing material reaches them? 
• How do they respond to your competitor’s products/services?

Understanding your ideal buyer will give you an accurate competitive analysis and a comprehensive insight into how you can develop your product/service to be unique.

Check out this useful video by lemlist for a step-by-step guide to building your buyer persona:

Example

A prominent example of a brand that curated its product according to its ideal buyer is Alienware. Alienware is a gaming division, owned by Dell. They solely focus on manufacturing gaming laptops with features and functionality, every gamer wants.

Alienware has established itself in a specific niche-gaming. Not just tech or electronics. This strategy has allowed the brand to cater to a very specific audience-gamers, not only laptop users. Because of how specific Alienware has outlined their target audience, their product appeals to their customers.

Instead of wasting time trying to sell all kinds of tech gadgets to everyone, Alienware focuses on solving the challenges and pain points of gamers.

2.Establish Relationships with Influencers

If you want to give your entire peer-to-peer marketing strategy a boost, influencer marketing is what you want to do. 

91% of businesses believe that influencer marketing is highly effective. And it’s no surprise that millennials respond to influencer marketing as 40% feel that influencers understand them better than their friends do. 

But you can’t settle with any influencer. These are the essential factors to evaluate:

• The influencer has a large following. If you’re skeptical about an influencer having fake followers, there are ways to check if your influencer’s followers are real.
• The influencer applies to your niche and target audience. 
• The influencer is active on social media and posts a lot of content related to your industry.

Once you’ve done extensive research on your influencer, don’t be afraid to reach out. Over 70% of influencers prefer it when companies reach out to them instead of an agency. 

Example

On National Donut Day, Dunkin Donuts and their agency, Trilla, ran a national Snapchat campaign. The company partnered up with Collab, a digital talent network and entertainment studio to make this campaign a success.

Dunkin Donuts chose 8 influencers to upload teaser content. And on National Donut Day, the influencers took over Dunkin Donut’s Snapchat channel.

All 8 influencers worked to raise awareness about National Donut Day and encourage customers to swarm to Dunkin Donuts. This worked and Dunkin Donuts gained 10 times more followers on their Snapchat channel than they get in a month.

3.Turn Your Current Stakeholders Into Evangelists

Brand loyalty means everything because loyal stakeholders don’t always make rational or price-based decisions. These stakeholders make emotional-based decisions because of their loyalty to a business.

For instance, if you have five employees that have been with you since day one. Those employees aren’t just going to get up and leave when the going gets tough. Based on their emotions and sense of loyalty toward your company, they’ll stick by your side.

But for the employees who have worked with you for a few months, they won’t have that sense of emotion influencing their decisions.

Turning your consumers into evangelists is also beneficial as 82% of businesses agree that customer retention is cheaper than acquisition. 

Ultimately, customer loyalty is an essential factor in any business.

By turning your customers into evangelists, there are more chances of them advocating your products and services to other customers.

This works the same way for any stakeholder. If you turn your investors into evangelists, this will encourage them to invest more and source other generous investors.

Turning any, if not all, of your stakeholders into evangelists is an excellent way to make sure they direct their peers to your company.

But how do convert your stakeholders into evangelists? Here’s how:

• Listen to them. Feedback or any form of communication from your stakeholders should be acknowledged and responded to. Doing this will show them that you care about their experience with your brand and they are a priority. Also, this will help you identify any mutual challenges or disadvantages they experience with your brand. And how you can solve it. 
• Practice loyalty marketing. You don’t have to implement a super-advanced loyalty program, but developing loyalty is a must. Offer incentives to your stakeholders for taking a certain action.
• Provide a fantastic user experience. Give your stakeholders a personalized user experience that responds to them. And allows them to benefit from your business in a way that is convenient and beneficial to them.

Example

Sephora, a retailer of personal and beauty products, used a loyalty program (The Beauty Insider Program) to convert their customers into Evangelists.

The products Sephora sells are not what one would consider “cheap”. So Sephora rewarded their customers with one point for every dollar spent.

Customers could redeem their rewards as discounts or coupons. To sweeten the deal, customers could also redeem exclusive rewards that include in-store beauty tutorials and limited edition products.

The participants of this loyalty program make up 80% of Sephora’s yearly sales.

4.Build an Exclusive Online Community

To practice peer-to-peer-marketing, you need to provide your stakeholders with a space to engage and interact.

Doing this will give them an excellent opportunity to share information, benefits, and testimonials about your product.

Most importantly, you need to ensure that your online community provides your stakeholders with value and is worthwhile for customers to join.

It’s crucial to understand that building an online community requires a lot of work, time, and effort. But once the online community is on its feet, it’s undoubtedly worth it.

Take a look at this video by GoDaddy for more on building an online community: 

Example

MOM365 specializes in baby portraits but made itself a one-stop-shop for parents by building an online community.

The online community approaches questions, concerns, and general communication parents have about birth, baby development, and parenthood.

To reel consumers in, MOM365 used a catchy, relatable motto: “Who better to share their advice and opinions than other moms going through the same thing as you?”

The motto adds personalization to the community and creates an emotional connection between consumers and the online community.

5.Reward Your Online Community

Rewards are one of those things that nobody expects but everybody enjoys. And rewarding your community members will keep them engaged and invested in your brand.

Also, responding to your community members and welcoming new members is just as essential to keep your community active.

But you could never go wrong with rewards. Create a reward program that incentives your community members for achieving certain goals. You can reward them in various forms such as points or badges.

This is the engagement cycle CMX uses for their online community:

Be sure to add as much gamification as possible with your reward program to make it enjoyable and captivating for users.

Example

Marketo, an automated marketing platform, boasted a 79% increase in monthly engagement between July to October after launching their rewards program (Rockstar Rewards Program).

This loyalty program used gamification to reward their community members after achieving a specific goal, such as high engagement in the community.

Marketo received positive responses about the rewards program from their community members. Consequently, within 2 years they had received over 2200 ideas for their product.

This company used 160 of those ideas to enhance their product according to what their customers need.

6.Create Employee Advocates for Peer-to-Peer Marketing

I know people who would run ten miles for their company if they had to. When you ask those people about their jobs, they won’t fail to mention how awesome it is to work for their company.

But why is this?

Because those companies take care of their employees, they create an environment that is stimulating and inspiring for their workers, so people love working for them.

Consequently, those employees will generate more sales. When employees find ideal buyers, they’ll be proud to advocate their company’s products/services to them.

This is particularly effective as those employees will have the knowledge, skills, drive, and belief in your brand to make potential buyers feel a “desire” for your product/service.

Example

Not only does Starbucks host a victorious customer loyalty program, but the company has a successful centralized employee advocacy program, too.

Starbucks created employee partner accounts on many social media networks. On these social accounts, Starbucks encourages their employees to post images, videos, and stories about their product.

The company refers to employees who post regularly as “partners.” Using this term creates a sense of belonging amongst partners. But Starbucks doesn’t stop there.

Partners receive recognition cards for posting on social media, which further encourages more employees to take part. And this shows employees that their contribution to the company is not going unnoticed.

7.Partner Marketing

Collaborating with different businesses and affiliate marketers is what 74% of companies perceive as high-priority.

Primarily because marketing through affiliates or distribution partners allows you to reach a swarm of potential customers.

By choosing the ideal partner that has influence in your industry and an extensive network of trusted customers, you can streamline your sales funnel and close deals quickly.

When your target audience sees your brand besides well-known businesses/affiliates, they have more reason to trust your brand and engage in your content.

Within no time, word about your brand will spread, directing traffic straight to your store. 

Example

Louis Vuitton and BMW, two very elite and adored brands, collaborated to deliver their clients with affluence at its best.

The partnership bore a 4-piece luxurious luggage collection. They ingeniously designed the luggage collection to fit like a glove in the truck of the BMW i8. This entire partnership was a fantastic marketing tactic.

Both BMW and Louis Vuitton’s clients have extravagant tastes. And there are few things grander than a BMW and Louis Vuitton luggage collection.

Plus, designing the luggage collection to the i8’s trunk encouraged all the i8 owners to want this product.

Conclusion

As a form of word-of-mouth marketing, peer-to-peer marketing is one of the best marketing techniques to achieve your business’s objectives.

Consumers heavily rely on peer-to-peer marketing for purchasing recommendations. And through peer-to-peer marketing, brands can solidify employee advocacy, brand loyalty, and brand awareness, amongst other things.

For successful peer-to-peer marketing, it is imperative to use these seven strategies: Identifying your ideal buyer, Influencer marketing, Developing brand evangelists, Building an online community, Rewarding that community, Developing employee advocacy, and Partner marketing.

Follow these seven strategies and their examples closely to get the best out of peer-to-peer marketing!

References

Adweek: Why Consumers Share User-Generated Content (Infographic)

Annex Cloud: 42 Referral Marketing Statistics That Will Make You Want To Start A RAF Program Tomorrow

Cision PR Web: Market Force Study Shows Companies Wield Comparable Social Media Influence to Friends

Comscore: Comscore Study Finds Professionally-Produced Video Content And User-Generated Product Videos Exhibit Strong Synergy in Driving Sales Effectiveness

Extole: 15 Referral Marketing Statistics You Need To Know

Forbes: The Number One Thing Marketers Need To Know To Increase Online Sales

Franchising.com: Influencer Marketing: What Millennials look for in influencers

GetAmbassador: Recommendations Drive Growth

Get The Referral: Referral Marketing Statistics That Will Make You Want to Start or Relaunch Your Referral Program Now

HubSpot: 71% More Likely to Purchase Based on Social Media Referrals [Infographic]

Invesp: The Importance of Word Of Mouth Marketing – Statistics and Trends

Partnerize – Partner & Affiliate Marketing Research: The State and Future of Partnerships Survey 1/4 

Shane Baker: 85 Influencer Marketing Statistics You Should Know in 2024

Smallbizgenuis: 40 Amazing Customer Loyalty Statistics

SocialMediaExaminer: 6 Steps to a Successful Social Influencer Marketing Campaign

Social Toaster: 20 Advocacy Marketing Statistics You Need To Know

SpiceWorks: How to Win Friends and Influence IT Pros

The Producer’s Perspective: Some Word of Mouth Statistics that you may not know.

The post Peer-to-Peer Marketing: The Complete Guide for 2024 +Examples appeared first on P2P marketing.

Sounds simple, right?

However, in practice, setting up a successful referral program, growing it and keeping track of all your referrals, incentives, and rewards is not so simple!

In this guide, we’re covering how to develop a great referral marketing strategy. We will define referral marketing and discuss the benefits of referral marketing strategies.

We then show you how to develop your referral strategy, measure your progress, and which metrics to use!

What is Referral Marketing?

In the simplest terms, referral marketing is when customers refer their friends or family to a business through word of mouth, rather than the business using traditional advertising to attract customers.

Referral marketing happens naturally all the time, in many different ways. Word of mouth recommendations, sharing an experience on social media or advising a friend to try a product all fall under the umbrella of referral marketing.

People are naturally inclined to share their experiences and help others when they’re looking for a solution or a new product.

In this digital age, we’re more connected to larger networks of people via social media so the reach of referral marketing is even greater than it was in the past.

A formalized referral marketing strategy harnesses that natural process and adds an incentive for customers to refer their friends.

Incentives such as a small discount on their next purchase, early access to a sale or access to a higher tier on a loyalty program, reward customers for sharing, and in so doing endorsing, your business to their friends.

Many referral marketing strategies reward the customer who made the referral and the customer who was referred. They also motivate the new customer to join in get additional benefits when they refer others to the business.

One of the best examples of a successful referral marketing program is Dropbox. They offer additional storage space when you refer your friends. Neil Patel on YouTube talks about Dropbox’s strategy and other ways to boost growth in this short video here:

Everyone benefits from referral marketing. Customers are rewarded and receive additional value, new customers are rewarded and included in the program, and the business benefits from happy customers and an ever-growing network of new customers.

There are many additional benefits to referral marketing for your business, which we explore below:

7 Benefits of Referral Marketing

There are many great direct and indirect benefits to referral marketing. These are seven of the most important benefits:

1. Improved Targeting, Trust, and Credibility

When customers refer their friends or family, they share with a circle of people who are similar to them and already within your specific target market.

This means that your marketing efforts are automatically more focused and targeted toward the people who are more likely to convert. According to a Nielson study cited on HubSpot, customers are 4 times more likely to buy when they’re referred by a friend.

Tracking through your referral program also allows you to identify which customers are your most loyal, which helps you further target and segment your marketing efforts.   

People trust people. They trust recommendations and information shared by individuals more than those shared by companies or brands. The level of trust increases when they personally know the person sharing the information.

Another study by HubSpot found that 90% of respondents trust recommendations made by friends or family and 70% trust recommendations from consumer reviews. In contrast, 75% don’t trust traditional advertisements.

2. Higher Customer Retention and Customer Lifetime Value

When customers come to you by referral, they’re more confident in their decision, and when you provide a rewarding customer experience, they’re more likely to stay.

In fact, referral marketing improves customer retention rates by 37%, according to Deloitte.

That is a significant number, especially when you consider that the longer a customer stays with your company, the more valuable they become.

In addition to that, studies have shown that the customer lifetime value (CLV) is 16% percent higher on average when compared to non-referral customers.

3. Greater Reach and Higher Engagement Online

When a network of customers refers your company to their network of friends and family, the reach is exponentially greater than the reach you can achieve through traditional marketing.

The reach grows organically with every new customer participating in the referral program.

In addition, participating in a referral marketing program keeps your customers engaged with your brand and keeps them coming back to your site.

This kind of activity increases awareness of what you’re currently offering and often leads to more sales, simply because your customers are there and able to see what you’re offering.  

4. Increases Brand Awareness and Recognition

In an ever more socially connected online world, the way word of mouth marketing works has changed. It is no longer limited to the circle of friends we see in person and talk to frequently.

The daily use of social media and how we participate in different online communities means that we can reach a much greater number of peers, every day.

When you offer an incentive to refer someone to your company, it is easy for someone on social media to say ‘this company is great, hang on and I will send you a link that will give you a discount (or another reward) too’. They don’t even need to know the other person well!

When someone shares a recommendation on social media, it is seen by a huge number of people. It is not limited to the sender and receiver. Onlookers and people scrolling past see those comments, reviews, and recommendations too.

This increases brand awareness, recognition, and credibility.

We all feel more comfortable with a familiar name and remember a name we have seen frequently or heard our friends talking about. We trust it more, and we’re more likely to think of it when we need that type of product or service.

Referral marketing, social selling, and brand advocacy make a potent combination!

5. Easy Customization and Personalization

One of the best marketing benefits of a referral program is how easy it makes personalizing your customer experience.

When you already have someone’s personal information and their personal connection to your brand, it is much easier to make your communication personalized from the get-go.

The data you gather from your referral program will also enable you to make relevant recommendations to your customers and further improve your purchase rates.

A recent article from Forbes shows just how important personalization is for developing customer relationships and increasing customer loyalty and sales:  

• 91% of consumers say they are more likely to shop with brands that provide offers and recommendations that are relevant to them.
• 80% of consumers are more likely to make a purchase from a brand that provides personalized experiences.
• 72% of consumers say they only engage with personalized messaging.
• 80% of companies report seeing an uplift since implementing personalization.

Personalization is essential for modern marketing and sales, especially knowing a customer’s purchase history and tailoring your recommendations based on that.

6. Cost-Effective Marketing and Great ROI

Referral marketing is one of the least expensive and most effective forms of marketing.

When you use your existing customers to find you new customers, those customers are more likely to buy, more likely to stay, and more likely to have a high customer lifetime value.

This means the cost of customer acquisition is reduced, and the value of the customers acquired is increased.

It is still important to accurately calculate your referral program’s ROI and tweak your program to make the most of it, but generally, when compared to other forms of marketing and customer acquisition, referral marketing comes out on top.

7. Easy Ongoing Management and Automation

The joy of a referral marketing strategy is that most of the work is done by your customers. The initial strategy development and setting up the program are the most difficult parts of the process.

Once that is done, you can use dedicated software solutions to manage the program going forwards, which makes it quite simple.

Referral software allows you to implement and track your referral program using a high level of automation, which takes care of most of the heavy lifting.

They provide analytics and reporting that give you important information to manage and adjust your program for the best results.

Many also automate personalization and customization, making it even easier to provide the best customer experience for your customers.  

How to Track and Measure Referral Marketing

There are many different metrics you can use to track and measure your referral marketing strategy.

The metrics you choose to pay attention to should be closely linked to the goals and objectives you determine at the start of your program.

For example, if your main objective is to increase brand awareness, the important metrics won’t be the same as those for increased lead conversions.

With this in mind, let’s look at the five fundamental metrics you should use to measure the success and progress of your referral marketing program:  

Program Participation Rate

The average number of monthly users that are taking part in your referral marketing program. This refers to people who have actively engaged with the program in some way.

It does not necessarily relate to the number of referrals they have sent and can be linked to anything that constitutes a desired action taken.

Have they sent a referral? Have they clicked on or copied a link? Any action they have taken that indicates that they have started the process and are on the path toward full participation.

This metric is important because it gives you insight into how effective your program is at onboarding your customers.

A low participation rate means you need to look at ways to get more people into the program and assess what the barriers to participation may be.

Is the process too complicated? Are the incentives too small? No matter how great your program is, if people are not getting on board, it can’t be successful.  

Customer Referral Rate

The number of referrals being made through the program. This is the overall number of referrals, regardless of if it was one customer making 40 referrals or 40 customers making 1 referral.

This is an important metric to track as it lets you know many messages are actually being sent out to potential customers. You might have many participants but few referrals and vice versa.

However, the number of referrals made is the key to understanding how successful your program has the potential to be.

If your number of referrals is low, you need to assess why that is and identify how to make your participants send more.

This can be as simple as a reminder that there are great rewards to be had if they send a referral or a bonus incentive for x number of referrals.

Impression Rate

The number of people who have seen your brand or business as a result of the referral program. Tracking referrals sent, clicks on links, or email open rates are some of the ways of measuring this.

When it comes to social media and advocacy from your customers, it can be a little more tricky to track the number of impressions. Unique hashtags or links are one way to do this and some referral software allows you to track keywords and mentions on social media too.

This metric is important for assessing reach and brand awareness. If you want to increase the number of impressions, you need to look at ways to make social sharing easier and giving incentives that are geared towards giving customers something worth sharing.

Providing customers with something that allows them to brag a little, goes a long way here.

It is also valuable because it is an important part of measuring the percentage of people who took action after seeing your brand. It allows you to see if responses and actions are high or low, compared to the overall number of people seeing the brand.

Response Rate

The number (percentage) of people who took action after seeing your brand as a result of the referral program. This is the number of people who clicked on the referral they saw and took an action like signing up or even just providing an email address.

These are people who are now on the way to conversion but haven’t reached the end of the sales funnel yet.

If your objective was to grow the user base of your program and attract past and present customers, or grow a base of trial or free users for your service, this metric is an important indicator that your strategy is working.

This metric also gives you a basic number to see how many responses translate into actual conversions, if your objective to increase your number of paying customers.

Conversion Rate

The number of new customers, or people who buy your product or pay for your service, as a result of your referral marketing program.

This can be measured as a currency value based on purchases or as the number of unique people converted to customers.

If your objective was to increase sales revenue and grow your customer base, this is possibly the most important metric to track.  It ultimately shows you the value of your referral program for attracting new customers.

If your conversion rate is low, you need to assess and address why that is. It is important to consider all aspects, not just the referral program.  

If you have successfully got people to your page but they’re just not buying, one major factor can be user experience (UX) when they reach your site.

Slow page loading speed, poor optimization for mobile, lack of clear calls to action (CTAs) will all lower your conversion rate.

Bad copywriting, too little useful information on your product, or an overly complicated sales process can also factor into the decision to buy.

The five factors above are the foundational metrics to track and measure the success of your referral marketing program.

It is important to look at each one and make adjustments where needed so that the process does not bottleneck at any point in the program.

As your program grows and matures, you will need to delve deeper into analytics to make the most of your program.

Consider adding the following metrics to your analysis for a more detailed picture:

• Cost of customer acquisition (CAC)
• Customer lifetime value (CLV)
• Retention and churn rates
• Return on Marketing Investment (ROMI)
• Non-referral leads and conversions

Planning a Referral Marketing Strategy in 7 Simple Steps

Referral marketing strategies have been around for some time now and have proven, time and again, to be one of the best marketing strategies available.

They’re one of the least expensive but most effective methods and they’re pretty easy to set up and manage.

That said, it’s important to make sure you have a winning strategy from the beginning and you need to have the essentials of a referral program in place first:

1. Set Clear Goals and Objectives

Right from the beginning, you need to know what you’re trying to achieve. This will enable you to plan correctly and determine how you will track and measure your progress and success.

2. Identify Any Existing Referral Sources

Identify which customers are already advocating for you. They should be the first ones you contact when you launch your program and are the most likely to be your best brand advocates in the beginning.  

3. Plan How You Will Let People Know About Your Program

Make sure it is very visible for your new customers and that they see it at the right time (i.e. not right before you ask them for money).

Personalize the communication for existing customers. Reward loyal customers from the outset.

There are many ways to optimize your communication when you’re recruiting your first circle of customers into the referral program. A broadcast email won’t do it – you need to make sure it is customized, personalized, and well-timed. 

4. Determine Your Referral Incentives and Structure

There are many different kinds of incentives to offer besides cash and discounts. It is important to think carefully about what your customers will value most and what they can do with their rewards.

Look for rewards and incentives that will drive repeat purchases. Reward both the referrer and the recipient of the referral, and look for rewards that will drive further participation.

A tiered structure is particularly good for this and it doubles as another type of incentive you can offer by allowing referrers to move up a tier as a reward.

Whatever way you choose to incentivize and structure your program, it needs to be clear and easy to understand.

The incentives you choose must be aligned with your customer’s values and provide something they will personally value.

Cash and discounts don’t always work best, especially for higher-end products or services.

Some customers will value a sense of exclusivity more. You can cater to this by offering perks like exclusive access to events, early access to sales or product launches, or access to VIP rewards programs.  

Sometimes, learning which incentives get the most traction is a trial-and-error process, so keep an eye on your metrics and see what works best.  

5. Plan How You Will Run and Manage Your Program  

Choose the software you will use and select the people you want to manage it. This can be done in-house or by an external agency, depending on your needs.

It is important to have this in place from the beginning so that you can plan how to scale it as the program grows.

6. Inform Your Customers and Get Them Onboard

When you’re ready to get customers on board, you need to inform them of the program and how they can benefit from it. This is implementing what you planned in step 3. Make sure you do this part well to make the most of this initial interest and get the momentum going.   

7. Start Tracking and Measuring Your Referral Program

To run a successful referral marketing program, you need to keep track of it closely.

Referral software solutions will help you do this, based on the five foundational metrics we detailed above, and your specific objectives and metrics.

These are the bare essentials. If you have this framework in place, you have a solid foundation on which to build your referral marketing strategy.

However, there are some very important aspects to consider and incorporate into your referral strategy.

6 Tips to Build a Really Successful Referral Marketing Strategy

These six tips are the secret to referral marketing success. Every program is unique to its brand and company but certain aspects are universally applicable to referral marketing success!

To make the most out of your unique program, these are things you can leverage:   

Tip No 1: Build Strong Customer Relationships

When you ask a customer to refer a friend, you’re asking them to personally vouch for you. Their reputation is on the line here.

Make sure you have a strong relationship with them that they trust you and are confident in your company. Make sure they know exactly what you’re asking for, what it will mean for them and for the person they refer.

Choose the timing of your request well. Make sure your request comes with a reassuring incentive, something that affirms their value to your company.

Offering access to a VIP club or a higher level on your loyalty program or referral program is a good way to do this. It shows them that they’re valuable to you, not just for their referral. This offering should be as customized and personalized as possible too.

Tip No 2: Build Brand Affinity

Customers participating in a referral program are choosing to endorse your brand. They’re putting themselves alongside your brand and asking people to look.

It’s important that doing so makes them look good to their peers.

Brand affinity is what happens when your company’s values and those of your customers line up. They feel like you share their world view and you represent what their core values are all about.

This often has less to do with the product you make and more to do with why you make it.

Highlight what your brand stands for and your company values in a way that makes your customers look good.

If you’re an environmentally conscious company and making donations or planting trees on your customer’s behalf, make sure that is sharable information!

It is important here to be transparent and authentic. Let your customers know exactly what your company is all about.

You can highlight the aspects that speak to them personally but keep it real. People know when you’re not being authentic and only telling them what you think they want to hear.   

Tip No 3: Make it Easy and Make Everything Sharable

To be successful you have to make it easy for customers to participate. Signing up, referring friends, and claiming rewards has to be simple if you want people to do it!

Seeing their rewards and what the next reward they can get should also be clear and simple. Make it as easy as possible to see exactly what to do next and how it will benefit them.

Your website, your social media pages, and your referral program pages must be easily accessible and quick to use. No multi-step processes, no long forms, no slow loading pages.

Make sure that referrals and reviews are sharable on social media. Social sharing is now a huge part of daily life.

Making sure that your program is easy to share on social media is essential! Be sure to include attractive visual content for customers to share too.

Another great way to maximize social media sharing is to offer your customers personalized items to share on their pages. Things that make them look good. A certificate acknowledging the donation you made on their behalf to a charity is a great example of this.

Giving them something to share, that makes them look good and has your branding on it, is an incentive too!

Tip No. 4: Align Your Referral Strategy with Influencer Marketing

When you’re aiming to make your customers look and feel good, while advocating for you through your referral program, influencers can make a huge impact!

Using an influencer, big or small, positions your customers alongside them when they’re sharing on social media.

A respected and celebrated person who is also advocating for the brand makes your customers look good and will encourage them to share as publicly as possible!

Tip No. 5: Keep it Fresh and Fun

Referral marketing programs are voluntary. Making it interesting and fun, as well as rewarding, will go a long way to encouraging participation.

Use relevant themes, switch up the incentives now and again (without losing value to the customer) or create challenges or give special prizes to dedicated participants.

You can also gamify the process and allow users to compete for points on a leaderboard, with better prizes or incentives for those who make the most referrals in a given timeframe.

Regardless of how you do it, remember that the aim is to keep customers engaged and having fun. The methods you use should not make it harder to participate or harder to earn rewards.

Tip No. 6: Make it About Them and Make it Personal

One of the most important referral marketing strategies is to make things personal. When a customer is engaging with your brand or company often, it is vital to ensure they feel they are recognized and valued by the company.

Customer relationships need to progress like any other relationship – use your referral marketing data to keep that personal connection with your customers and build the relationship.

Personalized communication, product recommendations, birthday messages and gifts, congratulations on an anniversary with the company or a milestone achieved – these are all small ways that you can connect with a customer and let them know that you recognize them as an individual and value their loyalty.

Wrapping Up

In this guide, we have covered everything you need to know about referral marketing strategies so you can get started on your successful program today!

We discussed the benefits of referral marketing and set out the essential steps to take when developing your referral marketing strategy.

We then showed you which metrics to use and how to measure your progress and tweak your strategy accordingly.

Lastly, we included some important tips to make the most of your referral marketing efforts.

Social media and peer to peer marketing have never been more relevant than they are today, so these tips are especially important for success!

References

Forbes: 50 Stats Showing The Power Of Personalization

HubSpot: How to Build a Customer Referral Program

Medium: 5 Causes of Low Conversion Rates and How to Improve Them With UX Techniques

ReferralCandy: How to Measure and Improve ROI on Referral Programs

Talkable: 6 Reasons Referral Marketing is The Most Cost-Effective Customer Acquisition Strategy

The post Referral Marketing Strategy: Building a Growth Engine in 2024 [Guide] appeared first on P2P marketing.

Brands like Uber, Tesla, and Dropbox all use referral programs to grow and maintain their businesses. 

So, how have the really successful referral programs done it? And what can we learn from them make our own referral program success?

Let’s take a look at some of the most successful referral programs, and what we can learn from them.

Let’s dive into it!

5 Best Referral Marketing Platforms to Use for Your Referral Program

Every successful referral program relies on the use of a referral marketing platform to set-up and manage the program.

Good referral marketing platforms provide everything you need to run a successful referral program, from A to Z and beyond. 

Here are some of the best platforms to consider for your referral program: 

All the platforms above can help you set up and execute a great referral program.

Let’s take a look at what involves and some examples of the most successful programs we can learn from:

What is a Referral Program?

Let me give you some context on referral programs before we jump into the juicy bits.

Firstly, referral marketing works hand-in-hand with customer marketing and relies on word-of-mouth and referrals to promote a brand. 

Secondly, a referral program is when you give customers referral incentives for referring new customers to your brand. And thirdly, a referral incentive is a reward that includes discounts, freebies, gift cards, etc. 

Using referral marketing is the ideal way to motivate new customers to support your brand and attract past customers back to your brand. 

Referral marketing works because you are literally giving your customer a reward for generating new customers.

These are common objectives of referral marketing:

• Generate more customers at a lower customer acquisition cost (CAC).
• Encourage customers to spend more, increasing overall profits.
• Attain customers with higher lifetime values.
• Raise brand awareness.
• Gain customer loyalty in new and existing customers .

Whether or not your referral program will be a success depends on your customers. Therefore, it’s imperative to make sure they’re happy with all aspects of your brand. This includes your customer service and the quality of your products. 

Gaining happy customers boils down to engaging with them, approaching any concerns they have about your brand, and providing products/services that are valuable to them. 

A sure-fire way to ensure customers will respond to your referral program is by using top-notch referral program software. This will help you launch a well-performing, professional and responsive referral program. 

7 Crucial Aspects of A Successful Referral Program

1. Understand your consumers. Acknowledge the ever-changing trends and preferences amongst your consumers. Doing this will help you choose a reward aligned with what your audience would want.
2. Customize your referral program. Most referral program software will offer countless styles, templates, fonts, and designs for you to experiment with. Make your referral program appealing to your customers to grab their attention. 
3. Choose your referral software. Opt for referral program software that is known to create high-quality, attractive referral programs. You also want to make sure the software you choose has everything you need, eliminating the stress of having to settle.
4. Capitalize on happy moments. When your customers are satisfied with your brand, that’s the perfect moment to hit them with your referral program. For digital companies, promote your program after customers join your platform, sign a contract or provide positive feedback, etc.
5. Be clear and concise. Confusing your customers with complicated terms and drawn out sentences won’t keep them interested. Use brief sentences, powerful words, and keep it simple.
6. Make your reward accessible. The best rewards are ones that users can instantly access. You want to avoid making it hard to use the reward or receive it.
7. Thank your customers. Show gratitude to your customers by thanking them for their referral. Your customers will feel appreciated and acknowledged by your brand. 

The Top 5 Most Successful Referral Programs

1.Airbnb

When it comes to referral programs for small businesses and honestly all kinds of establishments, Airbnb leads a great example.

This popular web-based lodging platform featured on the list of best referral marketing platforms in 2019 and now, today. Here’s what they did.

How Airbnb’s Referral Program Works

A user can invite friends to Airbnb using a referral link. The friend must apply that link when signing-up.

He/she will then receive a credit of up to $45 on their first stay. In addition, they will also receive $17 toward an Airbnb Experience, provided it is $56 or more.

The exact amount of credit due to the referred for their first stay is expressed below:

The Results of Airbnb’s Referral Program

Hold on to your seats, ladies, and gentlemen, because your mind is about to be blown.

After implementing referral marketing, Airbnb’s bookings and sign-ups increased by an astounding 300%. Now, let’s look at what we can learn from this.

What to Take Away From Airbnb’s Referral Program

This referral program has proved that as excellent as two-part incentive programs are (where both the referred and referrer receive rewards) they are not compulsory for lucrative referral marketing. 

Above all, your incentive needs to be valuable and easily accessible. Airbnb also uses high-quality content on their referral program which comes off friendly and welcoming.

These factors further persuade users to share the referral link.

2.Uber

Unlike Airbnb, Uber has a simple two-part incentive program. This would be considered one of the best referral programs to make money. 

As it is, Uber has already solved a common problem today by providing reliable, convenient, and affordable transport. But this company took a step further and launched a super-beneficial referral program. Here’s what it looks like. 

How Uber’s Referral Program Works

When a user joins Uber, they receive a personal referral code. If a user shares that code with a friend, that friend has to sign-up and create an account using that code.

Once that is done, both the referred and referrer get their next trip free. 

This is a fantastic example of what a foolproof referral program looks like. New users can try Uber without having to pay a cent, and existing users can enjoy a ride for free.

It’s a win-win!

The Results of Uber’s Referral Program

Uber’s referral program result is a 12x ROI (Return on Investment). Meaning for every $1 Uber spent on their referral program, they received $12 in return.

Most importantly, it also confirms that using referral marketing software to create a program that benefits the referred and referrer is a strategic idea. 

What to Take Away From Uber’s Referral Program

You want to make your reward convenient and useful to your customers. Uber’s incentive is perfect, as people could always do with a free ride.

Also, the terms are not complicated to understand, and users get their reward instantly. 

These are essential components to consider for creating an effective referral program. Uber has made itself one of the best apps for referral programs. 

3.PayPal

Personally, PayPal’s referral program takes the cake for me.

The financial web-based platform rewarded its users for referrals by giving them money. 

Yes, that’s right, cold hard cash. It’s not to say that Paypal is making users rich, but hey, free money is free money! Let’s look at what they did.

How PayPal’s Referral Program Works

To participate in this referral program, users have to send 1 cent to a friend who doesn’t have Paypal.

The friend must follow this up by registering to Paypal, linking their card/bank account, and spending $5 within a few months. 

Once the referred spends the $5, both him/her and the referrer receive $10. Paypal offers a pretty appealing deal if you ask me. Let’s see how it performed. 

The Results of PayPal’s Referral Program

After implementing the referral program, PayPal’s daily growth rate increased by 7-10%.

To put it into more perspective, this company reached 100 million users credited to the referral program.

Who’s going to decline free money?!

There’s no question that PayPal’s referral program was one of the best referral programs of 2021 and will most likely continue to be in 2022. 

What to Take Away From PayPal’s Referral Program

PayPal’s referral program is so innovative that Dropbox created their referral program using it as inspiration. 

An essential factor to take away from this referral program is that the reward is suitable for everyone. This incentive makes people feel like they are literally being rewarded, and that’s because they are.

PayPal requires the referred to spend $5 before either party receives their reward. This tactic positively pressures the referred to use PayPal by spending money. 

It’s only a smart idea to use money as a reward if you can afford it and if it relates to your business. PayPal is a financial service so money as a referral incentive is relative to their company.

4.Tesla

On the topic of Elon Musk’s brainchildren, Tesla has changed their referral program over the years. This is to accommodate the evolving needs and wants of its consumers. 

This company has not only manufactured the most quintessential selection of electric cars uniquely. But also have a rocking referral program. Here’s what Tesla’s referral program looks like.

How Tesla’s Referral Program Works

Before their new referral program, Tesla boasted a very generous referral program. The referred and referrers received six months of free supercharging.

For every new referral, Tesla rewarded the referrer with high-quality wheels, a chance to watch a rocket launch from SpaceX, Powerwall batteries, and much more.

The more referrals a Tesla owner generated, the better the reward they would receive. After having five referrals, Tesla owners received a discount on the Roadster per referral. Later, they amended the referral program so those who gained enough referrals would receive a Tesla Roadster for free!

This referral program later shut down. Tesla felt it was unsustainable, and giving away free cars simply costed way too much money.

Today Tesla’s referral program is not as generous but still effective. Tesla car owners can share a referral link to prospective Tesla buyers.

The prospective buyer must purchase either the newest Model S, Model X or Model 3 Tesla. Both the referred and referrer will receive 1000 miles of free Supercharging. 

The referrer also stands a chance to win a Model Y Tesla every month and quarterly a Roadster supercar. Being a Tesla owner sounds incredibly blissful!

The Results of Tesla’s Referral Program

So you can be as shocked as I was after finding out what the results were, I have to tell you that Tesla claims to run off a $0 marketing budget.

That means no money toward advertising or anything alike AT ALL. But this only makes their results more impressive.

For their first referral program, Tesla accomplished a healthy 550 x ROI. This is quite surprising due to how luxurious Tesla’s referral incentives were

While Tesla hasn’t disclosed direct results of their second referral program, this referral program did help their company reach the value of $208 billion.

No doubt credit is due to various factors that make Tesla a successful company. However, their new referral program has definitely played its part.

Not to mention this referral program is a lot more established than the first, and today Tesla stocks are what made Elon Musk the world’s wealthiest man.

What to Take Away From Tesla’s Referral Program

This is amongst the customer referral program ideas, large businesses with enough capital can only execute (giving cars away can’t be cheap!).

However, there are many aspects of this referral program that you can replicate on a smaller scale.

If your brand offers products/services that are large payments, design your reward to make that purchase more economical down the line. Tesla’s incentive is free supercharging, cutting the cost of buyers charging their car for some time.

If you sell gas stoves, your reward can be free gas. Or if your brand sells high-end computers, your reward could be a free computer bag and so forth. 

Identify what your customers need and determine how you can incentivize them with that. It is also important to make sure that while your referral incentives are valuable for your consumers, they are still economical for your brand.

Always make sure you create your referral program around your customers.

So, like Tesla, you don’t have to spend a fortune on marketing because your referral program will speak for itself. 

5.DropBox

Like Airbnb, Dropbox has time and time again featured on the list of best referral programs in 2020 and back in 2019.

This famous referral program takes “rewarding customers with what they need” to the next level. Let me explain.

How Dropbox’s Referral Program Works

This file hosting service rewards both the referred and referrer with additional storage space. For basic accounts, users receive 500MB for every referral, which cut’s off at 16G.

Users on the Dropbox plus and professional accounts receive 1G of extra space for every referral, capped at 32G. 

The Results of Dropbox’s Referral Program

When a user runs out of storage space, they have to upgrade their account. But Dropbox offers users more space without them having to upgrade by simply inviting a friend instead. 

Credited to Dropbox’s ingenious referral marketing techniques, the company permanently increased sign-ups by a shocking 60%! Today, 35% of Dropbox sign-ups stem from the referral program.

These are very motivating statistics that prove how effective referral programs are for any business in any industry.  

What to Take Away From Dropbox’s Referral Program

If your customers have to upgrade to access certain features of your product, offer any of those features as an incentive.

9 times out of 10, there is something your customers want from those upgraded options. They just can’t afford it. This will be the perfect way to generate more consumers while giving them what they need. 

Make sure the incentive would help users easily achieve a common aim they rely on your brand for. 

7 Key Takeaways for Your Referral Marketing Program

No doubt, designing your referral program will demand a lot of time, effort, and creativity. But these examples of the best referral programs prove that it’s well worth your effort. 

Stimulating consumer engagement, multiplying your conversions, and gaining loyal customers are all benefits of referral marketing.

After reading this article, I hope you see referral marketing for the gold mine that it is. If you do, here are some fundamentals to keep in mind:

1. Keep your customers happy. Happy customers become advocates, and advocates refer more people to your brand. Constantly provide your customers with positively unforgettable service. You also have to make sure they recieve the quality of products they expect. Engage with your customers as much as possible and acknowledge their feedback.
2. Optimize your reward. Your reward will be the persuading factor of your referral program. Offering a valuable, easily accessible reward will encourage more customers to take part in your referral program. Ensure your reward is relative to your brand. And don’t make your reward hard to access or use.
3. Be original. There is nothing wrong with using other referral programs as inspiration, but be sure to add your own unique twist to it. Make it personal to your brand and to your audience.
4. Don’t be afraid of change. Like Tesla proves, sometimes you need to change your referral program for the better of your business. Listen to your audience to keep up with what challenges they face that your reward could solve.
5. Use your resources. Use what you already have to incentivize your customers. Whether you sell physical products or online courses, look at what you have and determine what you can offer as a reward.
6. Market your referral program. Let as many people know as possible about your referral program. Advertise it on social media, in conversation, or using techniques like email marketing.
7. Do your math. Don’t launch a referral program and just expect it to make money. Do proper calculations to outline what your objectives are for you to make a profit and measure your progress. 

References

Cloudsponge: How Airbnb Built One Of The Most Successful Referral Programs Ever

Entrepreneur: How Airbnb and Dropbox Achieved Tremendous Growth With Referral Marketing

Forbes: Tesla Is Now The World’s Most Valuable Car Company With A $208 Billion Valuation

Harvard Business Review: Why Customer Referrals Can Drive Stunning Profits

Social Media Today: 5 Powerful Reasons You Need a Referral Program

Viral-loops: Uber Referral Program: Case Study

The post 5 Most Successful Referral Programs to Learn From in 2024 [Case Studies] appeared first on P2P marketing.

According to Market Force, 81% of online customers in the United States get influenced by social media feeds or friends and family to make purchase decisions.

Also, 78% of these people consider social media posts from brands helpful in their purchases.

This huge chunk of paying traffic is actually referral traffic and it converts into money for both the business and the people sharing these references. This happens through referral links!

This article dives deep into the meaning, functions, and types of referral links. You can understand their uses and significance in the present marketing scenario.

What are Referral Links?

A referral link is a URL equipping an organization to advance its products, services or web content. They provide an incentive to customers and affiliate partners in the form of commissions, rewards, discount coupons, and other innovative schemes.

All customers who enrol for the referral program get referral links, which they can share with their friends, family, and acquaintances.

On a professional level, affiliate marketers are the biggest users of referral links.

Referral links are coded to be trackable. Therefore, courtesy of marketing automation, you automatically earn rewards when your link converts each time. 

Once the link is clicked and converts into a sale, the referral ID tracks down the account that provided the link and rewards the same on agreed terms.

How Is Referral Link Different from Referral Code?

A referral code is a subset of a referral link.

Referral links will be common for a particular campaign. However, the codes are unique identifiers that enable tracking of these links to each individual profile!

Some companies use referral codes instead of referral links. Those codes are asked during the sign up process.

So when users sign up, they are asked to enter their referral/discount code in order to receive a reward. In those cases, both the new customer and the person who referred them, receive a reward.

Why Use Referral Links?

Each company needs to convert its online traffic into paying customers in order to prosper.

In the brick-and-mortar world, affiliate and referral programs have yielded many successes like Amway.

Therefore, it only begs to consider that such incentive-based schemes will also work online. And they do!

Let’s check out how using referrals can be useful through some live examples:

The website and its backend system generate a referral link containing a unique referral code whenever a customer is enrolled in the company’s affiliate program.

The company can start tracking conversions and related metrics as soon as the customer shares their specific referral link with their friends, family, or acquaintances, thereby creating a new potential client.

The same goes for affiliate partners but on a larger scale.

Let us understand the function of a referral link by taking Chris’s example:

Chris is a long-term customer of hoops and bangles.com, an online marketplace for fashion apparel. He appreciates the company’s services and products.

He is also a member of the company’s referral program.

Chris recommends the company’s offerings to his friend Karen by sending her an invitation message.

He does this by sharing his unique referral link with her, which consists of a unique referral code.

Karen opens the message and clicks on this referral link.

She lands on the company’s webpage showing a message that her friend Chris referred her to use the company’s services and products.

Karen also sees, in the message, that she gets a 20% discount on her first purchase from the company’s website.

Through the referral link, Chris gets an incentive for referring Karen, such as a cashback on his next spend.

How are Referral Links Related To Referral Traffic?

A referral link makes it easier to track the performance of an affiliate customer.

They provide real-time insights on the addition of new customers.

These insights can be used to develop filtered sales funnels, marketing campaigns and tailor-made products that suit various customer profiles.

Therefore, referral links save significant time. Most advertisers share a singular objective: expanding traffic to their site.

Referral traffic is one of the fundamental marketing strategies that can have a significant effect on garnering a larger online audience.

Social media platforms, being the largest drivers of online traffic, often contain such referral links in their posts and, when clicked, take the visitor to a company website.

Now that most of these platforms are monetizable, referral campaigns are already seeing a lot of innovation in the form of rich content that invites engagement.

Also, referral traffic is essential to social media advertisers as it redirects potential customers to the company website from other websites.

This gives added visibility to the company’s products and services. This strategy allows the company website to transform guest visitors into customers.

Referral links are successful when executed with careful planning.

Abruptly putting up products for referrals without branding, adding value and information may yield bad results.

Keep these Pointers in Mind to Make the Most of Your Referrals

1. Adequate brand visibility

Revisit your customer relationships and make sure your brand is known for the success of your referral program.

You can promote your referral program on the brand’s websites, social media channel shout-outs, magazines, and emails. Build a base first.

2. Explain clearly how your referral program works

If you are going to impress someone, do it at your expense, not theirs.

Create explainer videos or graphics detailing how your referral link program works and how it will benefit users.

Any company should make sure that each of their referral programs is consistent and does not mislead partners.

3. Do a market study

Your company’s referral programs are not going to achieve their goals if the clients feel that your products or services provide too little value.

Invest in a relevant market study before referral programs are introduced. Make sure that what you are offering generates interest, need, and demand.

4. Make it super easy

The tendency to do minimal work is inherent in people’s behavior. Incentivize your customers and clients with the same gravitas.

More value, less effort (from customers) leads to more customers. Period!

The marketing and technical team have to work together to increase the engagement of any referral program.

Starting from the UI/UX, tutorials and accounting, everything should delight your affiliates and referral partners.

Conclusion

According to Nielsen, 92% of customers who buy online trust brand referrals.

Therefore, the success of referral links cannot be ignored un any efficient marketing campaign.

Various organizations propose referral programs for their clients.

It acquires better traffic to the business and is rewarding for their clients. Many firms are focusing on providing customized referral programs as a service.

Plan a value-based referral proposition for your clients, and you will see your referral conversions increase fruitfully.

The post Referral Link: The Simple Guide (How, Why and When to Use One in 2024) appeared first on P2P marketing.

And you’re constantly busy thinking about what to do to grow your business further and how to reduce the cost of acquiring a new customer (CAC).

You have heard about Referral Marketing and its potential, and are now looking for the right software solution for your business.

But finding the right solution and setting up a referral program that actually works can be very challenging. Unfortunately, many good businesses fail at referral marketing.

You will also discover that only launching a referral program is not enough.

You need to constantly remind your customers about the referral program and encourage them with various incentives to take part in it. But once it works, it’s like music to your ears!

The first step is finding a solution that will make the program work seamlessly and easily.

So, we have reviewed more than 40 referral solutions and selected the 14 we liked the best.

Below you can find the full breakdown with pros, cons, pricing and ratings, and reviews from real users of our favorite referral software.

It includes software for SaaS, e-commerce, and Mobile apps, as well as a buyer guide that will help you evaluate these solutions.

First things first, let’s take a deeper look into what referral marketing entails?

Quick Comparison – Best Referral Software for E-Commerce and SaaS

This is a brief comparison of the top referral software for e-commerce and SaaS businesses – scroll down to the full reviews for more info, pros and cons, and pricing!

What is Referral Marketing?

Referral marketing is a marketing strategy that utilizes word of mouth to promote a particular brand’s product or service, using existing customers to bring in new customers.

The existing customers are usually given an incentive to make them promote the business, where there is a win-win for both parties involved.

Here the business or brand is brought a new customer and the referrer is rewarded with something from the store.

This is also known as the reciprocity principle.

The word of mouth strategy is not new to the business world at all. A friend tells a friend who tells another friend, and with time, a company has grown in leaps starting with just one referral.

That process, however, can be incredibly slow, with customers often forgetting to refer your business.

On the upside, the digitization of this process has helped solve this problem, making it a much smoother process.

Now, using referrals is a stress-free and efficient way of expanding and strengthening your client base.

According to the Word of Mouth Marketing Association, 2.4 billion daily conversations are brand-related.

People like talking about the things they have bought and the merits of the goods or services. Not only do customers talk about brands, but these conversations also affect the choices that potential customers make.

Nielsen’s recent research shows that people are four times more likely to buy a particular brand when a friend advocates for the brand.

Another study by Nielsen suggests that around 92% of people report trusting their friends’ and families’ recommendations more than traditional advertisements.

In a recent statistic from the States – around 82% of Americans consider recommendations from family and friends when making a purchase.

Like the Old Spice commercials that went viral with 23 million views in 36 hours, referral marketing promotes your business with speed and an ROI that you won’t get with other methods.

With the right incentive and referral marketing software, you can build your brand name awareness, increase conversions, and make more sales.

Are you wondering if referral marketing will be suitable for your type of business?

Then, it might interest you to know that referral marketing works well regardless of the kind of business.

Whether you are a small store or a large corporation, referral marketing is one of the cheapest ways you can promote your business.

You can either ask your customers to advocate for you, train your employees to refer, join hands with a complimentary company, or do it all! The right incentive will also not cost you much.

So let’s lay out clearly what the main benefits are when implementing a referral marketing program and when using the right software.

What is Referral Marketing Software?

One major factor that can determine your success or failure in referral marketing is the type of referral marketing software you decide to use.

Referral software is the digital tool you would use to help you implement and manage a referral marketing program.

If the software requires your advocates to take a lot of time to refer your business, despite the incentive, they might decide not to mention you.

So it is best to find suitable software that is easy for you to manage and clear and user-friendly for the customer at the same time.

Our review of some of the best referral marketing software below will help you choose what is suited to you, your business, and your target audience. But first, let’s take you through the decision process of finding the best software.

A Buyer’s Guide: How to Evaluate Referral Marketing Software?

When it comes to selecting the best referral marketing software, your choice will mostly depend on the size of your business as well as your business’s priorities and the industry you operate in.

There is also no clear, cookie-cutter answer to finding the right software and it may require a few trial periods to finding the perfect one! But here’s a buyer guide to help you through the process-

1. Determine your industry-specific solutions – different industries will require different software to meet their specific objectives. Before searching for software, make sure you identify what your business needs it for, such as for e-commerce, retail, or as a financial service.
2. Seamless integrations – be sure to check what third-party integrations are incorporated into the software, such as CRM, email marketing, and automation. You must be able to track the referral journey clearly from the sales pipeline to acquisition.
3. Omnichannel support – evaluate the channels which support the referral marketing software and make sure that they meet your marketing strategy.
4. Capacity and scalability – it is important that the software can support your company’s campaign loads, so check details such as how many referral programs can be applied simultaneously, the number of transaction limits, customer communication, what the different peer communication options are, and wallets, etc.
5. Flexibility and customization – how versatile is the software? Does it allow you to add or remove different features without affecting its capabilities? It is best to find software that you can customize according to each type of referral campaign.
6. User segmentation – the software should allow you to manually arrange and categorize your users, over and above its automatic segmentation.
7. Analyzing campaigns – ensure the software includes different analytical functions, both scheduled and random so that you can manage your marketing campaigns efficiently. This includes measuring program participation, top influencers, total revenue and referral rates, etc.
8. Customer support – you will need to find a reliable software vendor, who responds promptly to your queries and who is always available to resolve issues. So make sure they have a strong customer support team, as referral programs are continually improving and updating from season to season.
9. APIs and data usage – check the genuineness of the referral solution. This means that it must have the right API capabilities and legal rights for businesses to run the referral program at its full potential. Here you want to make sure you own the information and data collected, as you don’t want to have any unwanted legal issues in the possible future.
10. Incentives – decide what you want to give your customers in return for their hard work and make sure the solution you choose can support in delivering those incentives to your customers.

11 Best Referral Marketing Software for E-commerce

1.Refersion

Refersion is a software that enables you to easily track referral sales and engage people in recommending your business. 

It connects very well with other platforms and even allows you to complete payments directly from the software. 

If you are focusing on affiliate marketing as well, you can show your partners’ sales record and keep them motivated to collaborate with you. 

The tool is very precise and offers detailed reports to help you analyze the progress and plan future campaigns. 

Pros & Cons

Pros: 

• Easy to track sales
• Fast integration 
• Strong customer support 
• Suitable for beginners

Cons:

• Limited affiliate features 
• Fewer payment methods 
• More expensive than other alternatives 

Price: $89 per month

Capterra Rating: 4.5/5

2.Upviral (for E-commerce and SaaS)

Upviral is another great tool for referral marketing that puts great emphasis on its capabilities of creating viral referral campaigns. Upviral is the right choice for marketers focusing on improving site performance such as the number of leads generated or the people converted. 

Its main features include the ability to create your own landing pages, thank you pages, sweepstakes, giveaways, and email drip campaigns.

The software allows you to set up sweepstakes and provides all the infrastructure required to launched one. This also includes pre-made templates that can be used to carry out the process. You can create and deliver unique prizes such as URLs for secret content, downloadable files such as ebooks or software, and discount codes for online stores. 

You can also set up smart leaderboards that encourage the participants to bring in more and more leads so that they can move up the ladder and unlock more milestones and prizes.

Through all these features, Upviral allows you to incentivize everyone, everywhere, and stimulate rapid business growth through innovative ways.

Pros & Cons

Pros

• You can run unlimited campaigns on all tiers of subscription plans which gives a good value for money.
• Prize delivery and leaderboards can be automated which minimize human effort.
• The mobile widget is fully customizable.
• Detailed analytics and reporting makes it easy to analyze the performance of campaigns.

Cons

• Social media share widgets are a bit slow to load.
• The opt-in form templates are not too editable.

Price: Trial – $1 (14 days). Starts at $49/month

Capterra Rating: 4/5

3.Genius Referrals

Genius Referrals is a great referral marketing software for any type of business, whether you are looking for a traditional or online marketing program. They are also a trusted brand, used by a wide range of companies across the globe.

Genuis Referrals offers a broad range of incentive types that you can tailor to your unique customer base and marketing campaigns, such as single and double-sided rewards, and fixed or percentage rewards. It also allows you to design multi-tiered and multi-level campaigns. You can then schedule your payouts to customers, such as through PayPal cash, or offering gift cards, products, account credit or Shopify discount codes.

Pros & Cons

Pros:

• 30-day free trial
• Affordable
• Great user-interface
• Personalized affiliate codes

Cons:

• Can be difficult for first-time users to implement
• Does not integrate with BigCommerce unless you buy your SSL

Pricing: starts at $49 per month for a basic plan

Capterra Rating: 4.5/5

4.Referral Candy

If you are just getting started with referral marketing software then Referral Candy can be a great option. It is very easy to set up and navigate afterward. 

The idea behind Referral Candy is to help online stores increase their sales. This is achieved by starting a variety of rewards campaigns that attract new customers. Moreover, integrating Referral Candy to major shopping platforms such as Amazon or shopify is very easy.

The software contains pre-made email templates that you can easily set up. You will have all of your contacts, rewards, and statistics displayed on the dashboard. 

Perhaps one of the biggest advantages of Referral Candy is its reasonable price compared to similar software on the market. 

Pros & Cons

Pros: 

• Great for beginners
• Easy to navigate 
• Quick integration with major shopping platforms
• Inexpensive 

Cons: 

• Limited features 
• May not be effective for all businesses 
• Occasionally takes more time to upload things

Price: starts at $49 per month

Capterra Rating: 4.5/5

5.LeadDyno

LeadDyno is a dynamic affiliate marketing software, used to attract loyal affiliates and can also be used as apart of an influencer marketing campaign. This software has several useful functions and features to streamline your unique referral marketing strategy.

By embedding social media links into applications, or sign up pages, as well as taking advantage of their personalized email follow up system, you will be able to reach a wide range of customers way more easily. You can also comfortably manage your social media campaigns with very little effort. LeadDyno boasts a customizable and embedded dashboard, which you can design according to your brand, while also making use of the software’s functionalities.

Pros & Cons

Pros:

• Easy to integrate into e-commerce, payment processors, email marketing apps, and CRM
• Transparent commission system
• 30-day free trial available

Cons:

• Setting up multi-level commission rates might be challenging for new users
• Customer support can sometimes take time to reply

Price: starts at $49 per month

Capterra Rating: 3.5/5

6.Referral Factory

Referral Factory is one of the leading software to create and run referral programs. It is one of the few tools that allow marketers to set up complete referral channels with just a few clicks.

The tool is particularly helpful for marketers just stepping into referral marketing as it provides over a thousand templates to start with. You can simply pick a template that works for you, edit it, and simply make the campaign live.

The rewards can be easily set from the software. These may include virtual rewards such as discount codes or coupons or even cash. 

The data can be viewed and accessed in real time to keep a track of all the rewards. Everything is easily accessible from the dashboard, which also allows the data to be exported in a CSV file. This way you’re able to keep a close eye on the growth of you referral program.

The software also has a strong suit of communication tools. You can set email triggers that notify the users when they successfully refer someone, just to encourage them to keep going.

Pros & Cons

Pros

• Robust reporting capabilities make it easy to track performance.
• The software is very flexible and easily adjusts to your unique needs.
• Referral data can be easily exported, making it easy to share it with all stakeholders.
• Their expertise with enterprise-level referral programs is commendable.

Cons

• The UX feels a bit clunky and outdated. It demands extra effort to get comfortable with.
• Customization is possible with the software but demands a lot of time and effort.

Price: Free Trial – 15 Days. Starts at $75/month (Get a 60-day free trial here).

Capterra Rating: 4.6/5

7.Referral Rock

Referral Rock enables you to completely automate the referral marketing process. You can do so by setting up personalized campaigns that engage your customers in social media sharing, dual-side rewards and many more. 

This software is suitable for any type of business, especially the ones that are just getting started. 

If you want to track your performance, you will be able to access Google Analytics that contains all of the important statistics. 

Pros & Cons

Pros: 

• Useful for any business
• Quickly engages referrals 
• Friendly user interface 
• Easy to navigate 

Cons: 

• Limited customization features 
• Basic reporting system 
• Higher price 

Price: starts at $200 for a basic plan

Capterra Rating: 4.5/5

8.Revetize

Revetize is a user-friendly referral software designed primarily for small or local businesses to manage online reviews, referrals, promotions, NPS (Net Promoter Score), customer follow-ups, and loyalty campaigns. Revetize is known for being a very effective tool for increasing customer communication and interaction, lead generation, and managing a brand’s reputation.

This software is very affordable and if you are worried about learning how to use new software, there are reps available who can take you through each step of setting up the program.

To see what Revetize can do and whether it is suited to your brand, you can book a demo with one of their operators.

Pros & Cons

Pros:

• Functional and easy to use
• Affordable for small businesses
• Great customer support, prompt communication, and quick to fix any glitches
• Able to customize your reviews requests

Cons:

• Limited templates
• Does not offer a free trial

Price: Contact them for a demo to receive a quotation

Capterra Rating: 4.8/5

9.Viral Loops

Inspired by major referral marketing ideas and campaigns such as Amazon or Dropbox, Viral Loops offers a variety of templates to help you spread the word about your business. 

The design of templates is very modern. Using these, you can start competitions, referral campaigns, or social media shares. 

There is a variety of ways of integrating your campaigns into any type of platform in a matter of minutes. 

If you’re looking for a simple, time-saving yet highly effective referral marketing tool, this may be the choice for you. 

Pros & Cons

Pros: 

• Numerous pre-made templates 
• Easy to integrate 
• Fast customer support 
• Inspired by successful campaigns 

Cons: 

• A limited number of templates 
• Limited customization features 
• Takes time to learn how to use 

Price: $49 per month 

Capterra Rating: 4.5/5

10.Invite Referrals

Invite Referrals is a very simple software to use, but it provides a full referral strategy, tracking tools and detailed analytics. 

You can start different campaigns with it and encourage customers and affiliates to recommend your business. 

Everything you need is easily accessible from the dashboard which has a very friendly user interface. 

Moreover, the platform is carefully optimized for social media and allows you to create highly interactive competitions and quests to quickly reach a large audience. 

Pros & Cons

Pros:

• Powerful dashboard 
• Easy to set up and use 
• Optimized for social media 
• Detailed reports

Cons: 

• Only a web version 
• Fewer designs 
• Fewer participants allowed 

Price: $79 per year for the Basic account, $199 per year for Standard

Capterra Rating: 5/5

11.Rex

If you’re looking for a way of collecting positive feedback, Rex can serve as a useful tool. It enables fully automatic campaigns which invite customers to rate your business and recommend it to friends. 

The fact that it takes just one click to leave feedback is probably a reason why people respond very well to it. There are no complicated tasks and multiple steps to take. You can have your recommendations in a matter of seconds. 

Have in mind that this is very specific software that won’t allow you a whole lot of versatility in campaigns. However, it can bring you great results in terms of ratings. 

Pros & Cons

Pros: 

• Fast and effective for getting feedback 
• Easy to set up and manage 
• One-click campaigns 
• Highly interactive

Cons: 

• Limited types of campaigns 
• More expensive than other alternatives 
• Basic reporting system 

Price: $240 per year/user

Capterra Rating: 5/5

4 Best Referral Marketing Software for SaaS

1.Post Affiliate Pro

Post Affiliate Pro is a comprehensive software that runs the entire affiliate marketing for you. It offers a variety of functions that increase your referral audience and visibility. 

You can create one or more campaigns at the same time and follow the detailed statistics on the achieved results. Plus, PAP is designed to be easily integrated with other platforms.

If you are not yet savvy about using a tool like this, PAP has very good customer support that will lead you step by step through the software. 

The software will pay off very quickly as it is very reasonably priced compared to the number of features it contains. 

Pros & Cons

Pros: 

• A comprehensive referral marketing tool
• Variety of available features 
• 24/7 customer support 
• Good value for the price 

Cons:

• Longer learning curve 
• Difficult to use for beginners 
• Requires some technical knowledge 

Price: starts at $97 per month 

Capterra Rating: 4.5/5

2.SaaSquatch

SaaSquatch is a cloud-based referral marketing system suited to SMBs who are wanting to implement an efficient referral marketing platform. This software is ideal for companies with 10,000+ customers, who are B2B and B2C startups, Unicorns or Fortune 500 companies. SaaSquatch can be a great way of offering rewards to customers across their journey, from acquisition, and referral, to retention. 

SaaSquatch includes built-in analytical tools and user-friendly data-handling and reporting capabilities, to help you track your referrals.

By incorporating security management measures, it also allows you to prevent any unwanted activities from occurring, such as fraud. The software also incorporates customized themes as well as mobile designed email notifications.

Pros & Cons

Pros:

• Manual customer segmentation
• Efficient customer support
• APIs are clear from the beginning

Cons:

• Limited 3rd party integration for small businesses.
• Could be challenging for first-time users with no prior software knowledge.
• Limited customization of reports

Pricing: Request a demo to receive a quotation

Capterra Rating: 4.5/5

3.Partner Stack

Formerly known as GrowSumo, Partner Stack makes a powerful tool for connecting with partners and strengthening the relationship with affiliates.

Additionally, it allows you to build referral partner lists and increase your audience. You can customize your campaigns to match the interests of a specific niche. 

PartnerStack is optimized to provide both you and all of your partners very good experience. They can create accounts in just a few steps and join you in your efforts to expand your audience.

Compared to other software, PartnerStack is more expensive. However, once you weigh in all of the benefits, it makes a good long term investment. 

Pros & Cons

Pros:

• Easy setup process 
• Saves time for your partners and affiliates 
• Allows to create customized campaigns 
• Facilitates building strong partnerships 

Cons: 

• More expensive 
• UI can be a bit complicated 
• Fewer email customization options 

Price: $500 per month

Capterra Rating: 5/5

4.Tapfiliate

Tapfiliate is a wonderful, cloud-based affiliate tracking software that can be used for setting up a referral or affiliate marketing program for your business. 

From the get-go, you can implement your unique tracking code onto your website and start attracting affiliates. This software also allows you to share short and attractive links with your group of affiliates, without it looking cumbersome. 

Tapfiliate supports multiple languages and currencies, enabling you to comfortably run a global marketing campaign. You can also custom design your emails, affiliate pages, and referral links according to your unique brand.

The software includes over 30 different integrations, including Zapier, Shopify, WooCommerce, Squarespace, Wix, Stripe, and more.  

Pros & Cons

Pros:

• Appealing user interface.
• No transaction fee charged as different pricing models are based on the number of affiliates you have, clicks made and conversions, etc.
• Able to manage several affiliates at the same time.
• Can pay affiliates in different currencies.

Cons:

• Could be challenging to set up for first time users.
• No inbuilt newsletter feature, so need to use Mailchimp on the side.

Price: from $69,00 to $149 per month

Capterra Rating: 4.5/5

What are the Benefits of Referral Marketing?

There are a lot of benefits and here are just some of them:

Higher customer retention rate: customers who join your referral program are more likely to remain with your company or business and become loyal customers.

Customers trust a referral: people who receive a referral from another customer are more likely to trust the referral and to take action on a referral, leading to a new customer.

Increasing your client base: this might be a given, but it sure is true! Every existing customer comes with a wide network of contacts and at just a single click of a button, you will be able to reach way more people. This also means you don’t have to sit there doing all the hard online marketing work yourself, allowing you to use your time way more productively.

Valuing customers leads to more valuable customers: a bit of a tongue twister, but it makes sense if you think about it! Personalized marketing is the way to go for 2024 as every customer is looking for a unique connection and brand experience. By offering a personal marketing approach, chances are more customers will be drawn to your brand, turning them into valuable customers. You don’t want just any customer, you want a customer that will stick around a long time.

Cost-effective marketing: while the incentives will cost a bit, this is a much more cost-effective marketing approach, compared to using traditional online adds. This in turn leads to a great ROI-value.

Automation is wonderful: at the beginning, there will be work needed to get the program onto its feet, but once it’s running, you can sit back and enjoy the benefits. Apart from monitoring feedback and a few other aspects from time to time, when using referral software, things will be a lot easier for you to manage.

Here’s a snapshot of some companies who are successful at referral marketing:

• DropBox – by offering users with extra storage space at no extra cost, should they refer Dropbox to a friend, they were able to increase signups by a giant 60%.
• Uber – offers different rewards depending on the type of referrals, such as cash and free rides, turning Uber into a sought-after service across the globe.
• PayPal – offered existing customers free cash, if they referred them to a friend, allowing them to achieve a 7-10% daily growth.
• Evernote – uses a successful point system, so that existing users who refer them to a friend, can unlock certain app features and unique capabilities.

How to Build a Referral Program

Our friends at SaaSquatch published this 90 second video that explains how to build a referral program and the most important aspects you should pay attention to:

Conclusion

Now that you have useful tools to help you grow your business, the only thing left to do is get on to work and start spreading the word about your business!

References

Annex Cloud: 39 Referral Marketing Statistics

G2 Learn: Referral Programs

Nielsen: Under the Influence Consumer Trust in Advertising

TrustRadius: Referral Marketing 

The post 15 Best Referral Software That Will Boost Your Sales [2024 Full Review] appeared first on P2P marketing.

In my years as a business owner, I have seen that referrals help you close a deal faster, build trust, and rapidly increase your conversions.

These are the 13 of the best referral program ideas that you can use to grow your customer base!

Before we launch into the ideas, let’s make sure we are clear on what a referral program is.

What Is A Referral Program?

A referral program is a systematic reward system used to get people to recommend your business to other people.

It is like traditional word of mouth marketing, but a referral program is more effective as the customers making the referrals gain something from the referrals made.

The rewards you give to your customers for helping you acquire new customers are called referral incentives.

These incentives come in different forms, ranging from discounts on subsequent purchases to free cash.

Referral programs are great. You not only gain new customers, but you also foster trust and loyalty in your existing customers. Your old customers keep coming back for the incentives, creating another avenue for long term revenue.

Now, you know the benefits of an excellent referral program. However, you don’t have any referral program ideas for your business. We are here to help you out of that dilemma!

These referral program ideas, selected from some of the best referral programs in 2019 and 2020, will help you get yours going.

Let’s take a look at some referral program statistics:

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13 Best Customer Referral Program Ideas

Referral programs are not one size fits all. What works for SaaS might not work for a small goods store.

Therefore, we have taken the liberty of explaining the type of businesses for which each referral program idea listed below could work well.

So, lets jump right in!

1.Social Gifting

Social gifting involves rewarding the referred friend instead of the referrer. Rewards do not always move people. But, gifting their friends with something thoughtful can push your referral program faster than any other idea.

Try the World used this idea for their anniversary celebration. The advocate gets to send a free box to three friends of their choice. The referrer does not get anything from this action other than the satisfaction of giving a friend a gift.

This idea will work well for a company that just wants to build awareness. If you know customers will buy your products once they know of it, you can make use of the social gifting referral program. It also strengthens the loyalty of your existing customers.

2.Free Cash

You can give out free cash to your customers for referring your brand. PayPal used this idea in their referral program. They experienced a 7-10% growth daily, which increased their customer base to over 100 million users.

While this idea worked perfectly for PayPal, you might want to take some time to think it out before using it in your referral program. Since this idea costs money, you might not want to do it for long. PayPal stopped the Refer-A-Friend bonus once they reached their target users.

If you are giving out money, you must ensure that you are using a secure referral program software. Good software will protect you from hackers. You will also be assured that you are getting good profits for the money spent.

3.Mystery Gift

You must understand the type of customers that your products attract before you start a referral program. While some customers will like to know what they are getting for referring your products, some customers wouldn’t mind some mystery.

MeUndies offer their customers a mystery gift when they refer the brand to their friends. The beautiful thing about this idea is its convenience.

Since it is a mystery, you can give your customers anything you have at hand that you are willing to give. This referral program is one of the best referral programs for small businesses.

4.Discounts on Subsequent Orders

Discounts on subsequent orders are an excellent referral program idea for products that you know your customers will keep coming back. This idea works well for brands in the fashion industry and other industries that cater to necessities.

Amuze, an exclusive fashion store, implemented this strategy by giving its advocates and their referred friends 25% off their next flash sales purchase.

You can use the approach if you want to increase the rate at which your customers come back for return purchases.

5.Charity Donation

Everyone loves to do good and look good. Instead of making your referral program about your advocate and the referrals they make, you can give a gift to a charity on their behalf.

This idea not only looks good for your brand, but your advocates also feel great about contributing to a good cause.

However, ensure the charity aligns with the goals and values of your brand and customers. For instance, if you sell gifts and toys for children, you can donate to a children’s charity.

6.Competitive Tiered Rewards

Making your referral program into a bit of a game is one of the best strategies for making it work. This program involves dividing the rewards into tiers that customers try to reach. The awards get bigger as they climb the scale pushing them to do more for your brand.

As the tasks keep increasing, so does your reach. However, this idea is one of those short term referral program ideas. You might soon run out of tasks or reach your target customers limits.

7.Referral Contest

A referral contest is not just a fun referral program idea, but you also gain much, much more because there is only one reward for the one winner.

Huckberry used this idea in a popular contest that rewarded the highest referrer with $1,000. You get people to refer your business to as many people as they know with this strategy, increasing the awareness of your business.

You can also increase brand engagement with this type of referral program idea. Ask your customers to tweet about your brand, like photos on Instagram, etc. These actions will keep your brand in mind while increasing your reach to other customers.

8.Free Information

Information is power. You can give your advocates free information, in the form of courses or workshops, for referring your brand to someone. However, this concept will only work if the information is worth the action.

If your customers find the information unhelpful and irrelevant to your brand, they might even turn back on you by badmouthing your brand. When using this idea, ensure that your customers don’t go through a lot of hassle to refer you.

GetResponse uses this idea by giving advocates a free digital marketing course. The course is worth up to 200 dollars. Existing customers get this bonus when they refer up to 3 friends.

9.Subscription Credit

Subscription credit is a quite popular referral program idea.  You don’t lose much when you offer subscription credit to your customers. Your customers also see it as a great incentive. It is one of the best b2b referral program ideas.

This idea reinforces the commitment of your customers to your brand. It also increases the chances of repeat purchasing. Customers use their credit to buy more from your store.

10.Discounted Services

Discounted services work well for a business whose customers will always need subsequent services. It is one of the powerful referral program ideas for hairstylists. Their customers will still need another hairdo.

If the customer knows that they could get a discount by bringing a friend, he/she sees it as a good deal. Your shop gains a new customer, more sales, and almost free publicity.

11.Upgraded Services

Sometimes, it doesn’t have to be a new thing. No one can resist the offer of a better version. If your business, as a SaaS or similar company, has a Premium version, you can make use of this referral program idea. You just give customers who refer a certain number of persons to your brand access to the Premium version.

Dropbox made use of this idea in one of the best referral programs in 2018. They offered customers additional storage space for every referral made. A customer could earn up to 500 MB on successful referral.

12.Free Goods and Services

Everybody loves freebies. You can give your customers certain goods and services for free every time they make a referral. This concept works well for both small and large businesses.

You just have to carefully select the goods and services you want to give out to your customers. Pick out products and services that would not cost your business much but would be appreciated by your customers.

For instance, if you offer a free clothing item resizing in a clothing store for each referral, it might not cost you much, yet your customers would appreciate it.

13.Cash In-Purchase

Unlike the free cash idea, you instantly get your customers to give you back the money you give them with this idea. Many stores use this idea by giving their customers cash in the form of coupons that they can use to get discounts on certain products.

You can also use this concept if you seek employee referral program ideas. Your employees will be glad to get some of the products they sell while still doing the same thing they do daily. It gives them more incentives, which means better productivity for you.

How To Make Your Referral Program Work?

Now, you have an array of referral program ideas to choose from for your program. You have to pick a referral program that suits your business and your brand. However, it is not only about picking the right referral program.

Check out this video by Partnership Playbook featuring top digital marketing influencer Kelvin Thompson on Referral Programs:

Several factors determine the success of a referral program. You have to take note of them in the implementation of your referral program ideas. Some of the factors you have to consider are;

Uniqueness of Your Brand:

Even if you are using an idea for a referral program, you have to align it to fit into your brand’s image.

Ease of the Program:

To create enough traction and increase conversions from your referral program, you must ensure that it is easy for your customers to refer your brand.

Attractiveness of the Program:

This factor concerns more than just incentives. Ensure that your referral program flyer is beautifully designed to draw the attention of your customers.

Your Choice Of Software:

The right referral software makes the program easy for you to manage and comfortable for your customers to join.

Final Thoughts on the Best Referral Program Ideas

Start by putting these factors in place, along with the right referral program idea. Are you still wondering whether to use a referral program for your business?

Let me remind you of Mark Zuckerberg’s words:

References

Business2Community:8 Highly Effective Refer-A-Friend Campaign Ideas 

Invite Referrals: Customer Referral Program Ideas – May the Best Army be Yours  

ReferralRock: Absolutely, Positively Best Referral Ideas (by Experts) 

Sales Camp: 11 Best Referral Ideas to Acquire More Customers 

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