There’s a reason so many companies have turned to refer-a-friend marketing – it works. With a refer-a-friend campaign, companies in all industries, and of all sizes, can see their growth skyrocket.
- When they’re referred by a friend, customers are four times more likely to purchase.
- And 74% of customers cite word of mouth referrals as a major influence in their purchasing decisions.
How to start a referral program that works? We’ve collected the best refer-a-friend campaign ideas to inspire you.
But first, let’s go over the top reasons why you should start a refer-a-friend campaign.
Why start a refer-a-friend campaign?
Refer-a-friend marketing is so effective because of the power of trust.
Referrals come from a trusted source. When leads hear about a service or product from someone they know personally, it makes them more likely to purchase.
Think about your own shopping experiences. You’re more likely to buy a product or sign up for a service if you know someone who has vetted the company first. You’re going in with good expectations, and are less apprehensive about the experience.
When their friends approve of a brand, that matters to potential customers. Starting a refer-a-friend campaign is a proven way to capitalize on ingrained consumer habits.
How to start a refer-a-friend campaign?
Now that you know how powerful referral marketing can be, how can you set one up for success?
Follow these proven tips to start a refer-a-friend campaign that works:
- Make sure your products and customer experience are worth referring
- Offer exciting rewards (we’ll cover the best refer-a-friend rewards in detail below)
- Give customers multiple options to refer friends, including email and social media
- Optimize social media sharing, as that’s where people naturally share with many friends at once
- Provide a unique referral link that customers can copy and paste anywhere
- Make referring simple enough that customers can share in just a few clicks or taps
- Include a pre-filled referral message
- Follow referral program templates to craft the best messaging and layouts
- Make your campaign easy-to-use on mobile, as most customers share cool things with friends via their phones
- Promote your referral program on a variety of channels
- Choose the right referral marketing software to easily track the success of your referral program
For more details on these and other campaign best practices, don’t miss our ultimate guide to referral marketing programs.
Refer-a-friend campaign essentials: Referral rewards
The best refer-a-friend campaigns offer referral rewards. These are incentives that motivate existing customers to share your brand with friends, and that encourage new customers to sign on.
Here are the top reasons why referral rewards are so important:
- Giving rewards to new leads makes them even more likely to purchase
- Offering rewards to existing customers (for successful referrals) drives them to share with more friends
- Referral rewards encourage loyalty to your brand, especially if they tie back to your business
Because of this, stellar refer-a-friend campaigns are a win-win experience. In referral marketing, everyone comes out ahead.
Brands who have embraced referral rewards have found growing success in their refer-a-friend campaigns.
And, because rewards don’t leave your hand until the new business is closed, there’s no need to worry about excessive costs. Just fresh funds coming in, allowing your business to grow with the help of referrals and warm leads.
Top 10 refer-a-friend campaign ideas: Choosing the best rewards
Now that you know the power of starting a referral campaign – and how effective incentives are – which rewards should you choose? We’ve rounded up the top 10 refer-a-friend campaign reward ideas.
1. Store credits or subscription credits
Store credits (or subscription credits) encourage customers to buy more of your services or products. This gives them a deal on their next purchase, which eventually moves money right back into your brand’s pocket.
Thus, credits are an affordable way to provide a reward. Because you’re essentially offering a discount, there’s little to no cost involved in handing this incentive out.
A store credit or subscription credit can also be used on both ends of the referral (to reward both the existing customer and newly referred lead).
2. Tiered referral rewards
A tiered referral reward system gives out different levels of stacking rewards once customers reach certain referral milestones.
The most common tiered system lets advocates earn more valuable rewards by bringing in bigger target numbers of new customers. For example, a makeup brand may offer a free lipstick for 5 referrals, a free concealer for 15 referrals, and a free palette for 25 referrals.
This can be an added incentive to get customers to draw in more users. You’ll be surprised at how much growth this could potentially drive for your brand.
Razor company Harry’s used a tiered referral structure to collect 100,000 leads’ emails in just one week!
Alternatively, you could offer a larger reward for the first referral, then smaller rewards going forward. For instance, customers might receive $50 for their first referral, then $15 for all subsequent referrals. This method has been proven to work by delivering an initial shock factor that excites, then still rewarding customers for new leads.
3. Social gifting – giving a reward to a friend
You can also reward customers by allowing them to give something valuable to their friends. Social gifting means the referring customer won’t receive a reward, but their friend, the new customer, will.
This is a great way for customers to pass along something fun and exciting to their peers, whether that’s a free gift with purchase, a percentage off, store credits, or another gift.
You may wonder if anyone will be willing to share with others without getting a reward of their own. While it’s true that offering rewards to both parties is more effective, people still can’t help but share something exciting things with their peers. And it’s human nature to want to help a friend!
This refer-a-friend campaign idea is a great way to entice a new customer, and get your referrer to feel good about their connection.
4. Donations to charity
By giving back to those in need, you can excite customers by letting them put their efforts toward a good cause.
Charitable rewards mean that a donation is made on a customer’s behalf for every successful referral, instead of the customer receiving that money in their own pocket.
Like the social gifting option, this type of reward appeals to customers’ emotions. They’ll feel good about helping others, so they’ll be more likely to keep bringing you leads through the refer-a-friend campaign.
You could partner with a single charity that aligns with your brand’s mission. Or, select several charities, and give customers a choice of where their donation funds will land. Either way, this will draw in continued warm leads from warm hearts.
5. Surprise mystery rewards
Who doesn’t love the allure of a good mystery? The appeal of earning an unnamed reward is a huge perk in its own right.
It creates a fun marketing game that excites consumers to refer, just by presenting an intriguing unknown.
This is a great referral campaign idea for many reasons.
- If you have limited-run or seasonal products, you could hand out those products in your referral marketing program.
- And regardless of the products you offer, this gives your brand some freedom to switch up prizes based on what makes sense at the time.
- Customers may even refer friends just to solve the mystery.
- Plus, if they’re excited about the surprise they receive, they’ll probably share about it on social media (generating buzz for your brand).
In one mystery reward example, Robinhood gave stock credits to customers, but they left the type of stock unknown until customers successfully referred their friends. The possibilities ranged from high-value tech stocks (like Facebook, Apple, and Microsoft) to new and emerging stocks with high potential. This created a reward that was high in value to the customer, and therefore, well sought-after.
Just remember that, like in the Robinhood example, customers should be excited about what they receive. They are likely to discuss the reward online, so you won’t want to disappoint their expectations.
6. Exclusive memberships
When enticing current customers to refer, giving them VIP treatment can be a surefire way to get their attention. They’re already invested in your brand, so encourage them to take the next step.
After customers make a certain amount of referrals, you could grant them access to an insider club filled with the best perks. These could include exclusive or early access to sales, concierge customer support, free products, first access to new offerings, or a free month of add-on service.
A club structure has the added benefit of showing customers how invested you are in them (ideally, further enticing them to send in referrals, getting them to make more purchases, or convincing them to upgrade.)
But it’s also a cost-effective way to offer rewards to your customers. Because the reward goes back into your own pocket, you’re spending a small fraction on each customer incentive.
Consider cashing in on this excitement and offering exclusive memberships as part of your refer-a-friend campaign. You can even kick it up a notch, and offer the highest-tier rewards of your club for your top 25 or 50 customer advocates.
7. Service and/or software upgrades
Upgrading their service is another way to reward customers – and show them what else you have to offer as a brand.
Offer them more for bringing in a referral, and you can provide a valuable piece of motivation to the customer. Better yet, the upgrades don’t cost your brand a thing.
For example, Dropbox offers customers more storage data for each referral. This is a great way to reward the customer for their efforts, without putting a dent in the company’s bottom line.
Upgrades could also include access to premium features, or a free month on your next-highest subscription plan.
Customers will be excited to try out the next level up. So, the allure of the “upgrade” can do wonders all on its own.
And after someone has had a taste of the upgrade, they’ll likely be hungry for more. This will entice them to keep sharing with friends, pay for the premium-level service, or both.
8. Repeated benefits
Sometimes, keeping it simple is the way to go. Giving the same reward for every single referral gets customers excited about sending in referrals. After all, they know what to expect, and there’s no cap on the rewards they can earn.
Repeated cash rewards (referral fees), discounts, and credits can all entice the customer to send in more referrals. Who wouldn’t want free money every single time they share a favorite product with a friend
Don’t shy away from this method, as it’s easy and it works wonders for customer acquisition. You’ll likely find that the new business you receive far outweighs the referral fees’ costs.
9. Contests
Perhaps one of the only things more exciting than getting a reward for your business referral is winning a referral contest!
Set up a refer-a-friend campaign in which customers compete to win a big-ticket reward, reserved for whoever refers the most new customers in a given timeframe. You’ll be surprised at how much momentum you can drum up.
Customers will be hyped up about winning, and it will entice them to invite more friends and family members to sign up for your services.
Since winning customers will be based on the number of referrals they bring in, you’ll need to keep track by giving out referral links that are unique to each user.
Even with an enticing grand prize on offer, it’s a good idea to create tiers of winners so more people are motivated to keep referring friends.
- Perhaps this means handing out second and third prizes.
- Or, you could give a smaller reward to every customer who brings in a certain number of referrals.
Contest programs that receive the most success give all customers a small reward for each referral, but then let customers compete for the biggest-ticket reward.
10. Gamified rewards
Take the excitement of building on a referral contest, combine it with a tiered structure, and take it up a notch, and you’ve got gamified rewards.
Customers will be excited to keep playing the game to keep reaching higher levels of rewards. And that game just happens to be bringing in referrals for your brand.
- Make it fun by naming the levels and creating badges that customers can proudly earn.
- Be sure customers have a progress bar that tracks how close they are to “leveling up.”
- Each level should activate different “power-ups” (rewards from your brand, whether they’re monetary or freebies).
Gamifying referrals also encourages friendly competition. By playing against one another, customers will not only have fun, but you’ll gain more referrals.
Looking for even more referral program reward ideas? We’ve got you covered.
Ideas for promoting your refer-a-friend campaign
A solid refer-a-friend campaign idea isn’t enough for success on its own. Sure, you have the basics in place, but the refer-a-friend campaign won’t just run itself. Be sure to promote your referral program so customers know it’s active. and can easily find it to participate.
Promote your program to all customers at once, with methods such as:
- Banners on your website
- Social media posts
- Dedicated promotional emails
- Sections in your email newsletter
You should also promote your referral campaign to individual customers when they are most satisfied with your brand.
Once they’ve made a purchase, after they’ve given positive feedback to customer service, or after they’ve left a stellar review are all good times to personally reach out to customers and ask for referrals.
For more information on how to promote your referral campaign, check out our other in-depth article that can help you take your marketing up a notch.
Wrapping up
Creating a refer-a-friend campaign can be a great way to grow your business through word of mouth. By gaining warm leads from happy customers, companies of all sizes, and in all industries, have been able to greatly expand their customer base.
Be sure to offer a reward to entice your customers to refer. From creating a tiered reward system, to a competition, to rewards that give back to charity, you can find a way that best reaches your market.
Consider implementing these and other smart ideas to help scale your business, while exciting your loyal customer base.
Or, check out these resources for referral program ideas by industry: