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By nature, human beings are social animals. Our default mode is to be surrounded by friends and share our personal experience with others.
It’s a fact that a highly satisfied customers can do a lot of legwork for your business. And when 92% of people trust word-of-mouth referrals, especially from people they know, why not take advantage of this referral marketing strategy?
What Is Referral Marketing?
In simple words, referral marketing is spreading the word about your product or service via existing customers. It is essential free way to grow your business as your existing customers will bring in their friends to your business so they can try out your brand, increasing long term revenue whether for products or services.
Why Do You Need Referral Marketing?
Normally, referral marketing happens organically. But still, most customers will forget to tell their friends about you in real life, even if they had an incredible experience with your brand. That means, you could be losing potential revenue. Thus, the role of a referral marketing is to deliberately influence the process by giving some incentives, so that more people will spread the words about you with their friends.
Awesome Referral Marketing Examples To Make You Inspired
1. Harry’s – Refer a Friend
Dedicated to collect the email addresses of their potential qualified customers, Harry’s executed a week-long pre-launch referral program. In this great example of a referral program, their team gave away different products depending on the number of friends they referred, such as refer 10 friends and earn a free razor.
As the week-long campaign wrapped up, the results surpassed all expectations as they generated 100,000 leads within the first week.
2. Oxwhite – Invite 5 Friends & Get a Classic Shirt at RM0.99
Without a doubt that Oxwhite’s referral campaign is a huge success as they gathered more than 50,000 subscribers to their website prior launch day. In simple, Oxwhite blasted an ad that says the first 1,000 people to pre-order only need to get 5 friends to sign up on their platform, in order to get a classic white shirt at RM0.99.
This seemed simple enough – the top customer had almost 500 referrals under his name when he only needed 5. And all those who signed up an account with Oxwhite will be included in their email marketing list, which becomes another source of potential customers for the team to reach out to.
3. Dropbox – Get Up To 1GB Free Space By Inviting Your Friends
Like many startups, Dropbox struggled to grow their user base. They had turned to search engine marketing as the answer to their growth bottleneck, but it was an epic failure. It turned out that their cost per customer was $388, when they only sell it at $99. They eventually decided to make use of a double-sided referral program that inspired by Paypal, where both advocate and their friend both get 500MB bonus space. Within 15 months along with this program, they went from 100,000 users to 4,000,000 users.
Before plan out your own referral marketing, here’s the 2 main components you must optimize to ensure the success of your program:-
1. Incentives – Getting the incentive right for your referral program is 80% toward success. Think clearly about what your customers want and also able to be a meaningful incentive for the friends they are referring as well. Here’s a rule of thumb we recommend for incentives:-
- Cash incentives for something people buy once/rarely buy, such as car and mattress.
- Discount coupon for something people buy often, such as clothes and cosmetic.
2. Promotion – Everyone love offer. You can make your brand visible to your potential customer by adding in promotion into your referral marketing program. It simple – just create a referral program by adding a link to it in the header of your website or newsletter will do! It can either giving in the way of discount or a discounted price.
Referral marketing can be a powerful component of your marketing strategy. Don’t leave this great chance behind and wait for it to happen organically. When you set out to plan your referral marketing strategy, the single most important thing to remember is to make it easy for people to share your content and easy for people to refer your product or service.
