Referral programs have become a popular form of marketing in the last decade. The hours spent on social platforms, a rise of digital influencers, the distrust in traditional ads – all these helped pave the way for word of mouth to spread.
But with all this popularity, it’s easy to assume referral programs need to be something really different to stand out. Something with several reward tiers and various rules.
Unfortunately, this can get tricky quickly. Launching a complex referral program requires a lot of time and effort. It can also be difficult to maintain alongside all your other marketing priorities. In between choosing different rewards and figuring out how to track all the data, complex referral programs take a while to put together.
The quickest way to a successful referral program is to launch as soon as possible. It makes sense – the sooner you’re up, the sooner you’ll get results. A running program also allows you to see how customers respond and then adjust your program as needed.
So how do you quickly launch a referral program? Keep it simple. Rather than getting caught up with all the different possibilities, focus on what you need to launch. Below, we break down five key steps that will help get your referral program off the ground.
Before you launch a referral program: A quick primer
Before we get started, it might be helpful to share some insights – factors we found to be common in most successful programs. In our years of referral marketing, the businesses that received the most returns from their program had the following in place:
- Quality products or services: It all starts with offering something worth sharing. If you have a great product or service that satisfies customers, you have the makings of a good referral program.
- A sizable customer base: The first referrals you receive will come from those who already love your product – your customers. The more loyal customers you already have, the larger the launchpad for your referral program will be.
- A set goal in mind: What do you want out of a referral program? More customers? Increased engagement? Setting goals early on will determine what data to track and if your referral program is performing well.
Step 1. Decide what your referral program is about
A common business practice is developing the “elevator pitch” – a few brief sentences crafted to persuade others about the value of an idea or individual. It also works for referral programs.
An elevator pitch for a referral program sums up the target audience, the rules, and the rewards – all in 20-30 seconds. After all, people are busy and taking up time these days is already a stretch for the average attention span.
Creating an elevator pitch for your program forces you to focus on what’s necessary and get straight to the point. It serves as a simple framework and, if well written, can be applied to your referral copy and collateral.
Some elevator pitch examples:
- “Our referral program makes it easy for partners to promote us to other businesses. They are able to send a unique referral code through email, text, or social media, and instantly get a $250 gift card for every completed referral.”
- “We offer customers a $20 discount if they refer a friend who makes a minimum purchase of $100. Customers refer others and earn rewards an unlimited number of times.”
- “Our premium members will receive one month of free service for every successful referral they make. If they reach five successful referrals, they will get one year of free service.”
Step 2. Choose the reward you will offer
Next is the question on your target audience’s mind: What are you offering?
A lot of businesses think people want something extraordinary or one of a kind – but most of them don’t. In fact, the majority of advocates (those referring others to your business) still prefer to receive cash or discounts above any other reward. Ultimately, the best reward really depends on your specific business (what can you give?) and your target audience (what would they like?).
Still on the fence about what to offer? Just ask. Reach out to a few of your most loyal customers, partners, or employees for their opinion. After all, they’re the target market for your referral program and likely to provide the best answer.
If you plan to reward both the advocate and new customer (this is called a double-sided incentive, and we highly recommend it!), remember to choose a great incentive for each. It can be the same reward (“Give $10, get $10), or it can be a different reward (“Share $25, and get $50 in return”). Whatever reward you choose, the most important thing is to offer something that works for your business and your audience.
Step 3. Create the copy and images
Source: Referral Marketing School
With your referral offer and reward in place, it’s time to start designing the program experience. How will it look for your advocates? How about for their referrals?
There are four major areas used in almost every program:
a. Advocate invite email
This is the initial message sent to advocates, inviting them to join your referral program. Keep it to the point – a headline offer, quick description, and a link to join the program are enough to draw an existing customer or partner’s interest.
b. Sharing dashboard
Specifically for advocates joining your referral program, these pages have everything needed to get your referrals going. What to include? A registration page typically features compelling offer text and a simple registration form, while the referral dashboard provides a way to share the referral link, and see all the advocate’s referrals and rewards.
c. Referral messages
Referral messages are shared by advocates to their potential referrals. Allow advocates to choose their preferred messaging. But to save them time, and speed up the referral process, we recommend providing pre-drafted messages they can easily customize and share. Messaging is sent in three ways:
- Social media: image and short text
- Text messages: short text
- Email: image and/or short or long text
d. Referral landing page
Once a referral clicks on the message link, they are brought to a referral landing page (also called a referral page). This page may be their first encounter with your company, so make a good impression – highlight what makes your company so great (i.e., “We deliver straight to your door”) and what makes your referral program worth joining (i.e., “With $25 off your first order!”). Finish with clear next steps, whether it’s filling out a form, heading to your online shop, or another call to action.
In addition to the above areas, there are many other referral program components you can create to boost engagement and overall success – reminder emails, referral notifications, monthly summaries. But for a quick-start referral program, focus on the four key areas above and you’ll be in great shape.
The following table includes some common materials used in referral programs:
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Step 4. Promote your referral program
Promotion is arguably the most critical step in launching a referral program. It’s also where marketers should focus their time and effort.
Good promotion extends well after a program’s launch. While long-term promoting sounds daunting, it doesn’t have to be. Just look at your current marketing channels – can you add a referral banner in your newsletter, or a pop-up on the website? How about a few lines in your order and shipping confirmation pages?
Take MOS for example. It’s a banking solution for students that offer $5.00 for every successful referral. Not a huge referral offering, but together with a solid content marketing strategy on topics such as the relationship between selective service and FAFSA, student grants, loans, and more, they have been able to increase their user base heavily, while opening access to a pool of over $160 billion in financial aid to the more than 400,000 students within their community.
As with all types of marketing, referral messages rely on timing. Inviting your advocates when they’re highly engaged (say, right after making a purchase) is the perfect promotional opportunity. And if you’ve created the necessary components covered in Step 3, all you’ll need is a small call to action or link to bring your advocates to the referral program information they need.
For ways to promote your referral program:
Step 5. Set up a tracking system
Now it’s time to tie it all together. Even the simplest program will have a handful of steps and customer touchpoints. And to really know if a referral marketing program is meeting your goals, these points all need to be carefully tracked.
A few key referral metrics include:
- Customer participation rate (percentage of invited customers who join the referral program)
- Customer sharing rates and sharing channels
- Conversion rate (percentage of referrals who become new customers)
- Number of referrals (who referred them and when)
- Number of visits to the referral landing page
Fortunately, most of this tracking can be automated. From the first share to the final sale, referral software will help guide the entire process. Want to know how many referral messages have been shared? Easy. Need to integrate with WordPress, Hubspot, or another tool? Done!
Referral software can even prevent pesky fraud from entering your program, such as customers who attempt to refer themselves or make the same referral more than once.
Building all these features yourself will take time, resources, and a highly skilled team. Or, you can just get straight to those referrals with a dedicated platform, like the one we provide at Referral Rock.
Launch your referral program
If you’ve been thinking about a referral program, but not exactly sure what to do, our best advice is to start simply. With some planning, the right referral software, and these five steps, you’ll be well on your way to referral program success.
