In 1998, a small payment services company concluded that traditional advertising wasn’t worth it. With a handful of customers and a limited budget, it just didn’t make sense.
So they decided to try something different: referral marketing.
They offered a double-sided reward to entice customers to sign up for their services. New customers that signed up got $10 into their account, and every referral they got landed them an additional $10.
Instead of spending thousands of dollars on advertising that may or may not bring in new customers, they decided to invest in their customers, and it paid off—big time.
In the first two years of their referral campaign, their consumer base swelled to 1 million users. Five years later, they hit 100 million users, and today they have roughly 425 million daily users. You know them today as PayPal.
Their viral growth inspired scores of businesses to reconsider their marketing strategy and incorporate referral marketing. So if you’ve been grinding your gears trying to grow your customer base with minimal results, then you might want to consider it too.
In this post, we’ll cover five ways to maximize your referral traffic and grow your consumer base. Let’s get started.
| TLDR Key Takeaways |
| You should have an easy-to-find referral landing page with compelling reasons to refer people. Make it easy for your customers to remember that you have a loyalty program—otherwise, they will forget, and you won’t get any benefits from it. Offer enough value to make it worthwhile for your customers to vouch for you. The more you give, the more you get. |
While this one might seem like a no-brainer, you’d be surprised how easy it is for your referral program to be hidden from your customers’ view.
Instead of burying your rewards program deep in your website or only offering it to them after they’ve made a purchase, you need to have it clearly visible to your customers. After all, what happens if they lose that screen or email?
To keep your program in front of your customers, you need to:
For example, Brooklinen used to provide a direct link to their referral program in their navigation bar. Now, they’ve combined their referral program with their loyalty program.
Every time a customer logs into their account, they get a reminder to refer their friends and family members so they can get more discounts.
This point piggybacks with the first point. Even though your referral program is clearly visible, it’s still beneficial to jog your customers’ memories every now and then.
The modern consumer is bombarded with tons of information, and if you’re not constantly reminding them that you have a referral program, there’s a chance it will get lost in a sea of noise.
There are a number of ways you can remind your customers about your referral program:
For example, Dropbox takes advantage of omnichannel marketing and uses it to boost its referral program.
Every time a customer logs on to their account, they have a special banner that shows them their current storage level and shows them different ways to get more, including referrals.
They also send out special email campaigns that make it easy to refer their contacts.
And finally, they have a blog with detailed instructions where customers can learn how to send a referral and see the status of each referral.
Contrary to popular belief, not every customer who loves your product is going to tell their friends about it—well, at least not without some incentive.
That old adage, “You scratch my back, I’ll scratch yours,” sums up this dilemma perfectly. If you want customers to talk about your brand, you need to give them a reason to do so.
This incentive should be:
PayPal’s referral program is a prime example of this. All customers have to do is send out sign-up requests to their friends through the messaging platform of their choice (SMS, email, Facebook, or Twitter).
When a new customer signs up using the link provided, the referral gets $10, and the original customer receives $10. PayPal implemented a limit on the number of referrals a customer can claim. This way, they can control the number of rewards they give out.
You’ve probably spent hours drafting up the perfect sales landing page to get your customers to convert, so why wouldn’t you spend the same amount of time on a page designed for lead generation?
No matter how you are getting customers to your referral page (email, SMS, social media, etc.), once they get there, it should be well-designed and user-friendly so that customers know exactly what they need to do to get a referral.
To optimize your referral landing page, you need to:
Another thing many businesses forget is that your referral program landing page isn’t just for returning customers—it can be a way to convince new customers to try out your brand.
TMobile used this to its advantage. Customers can select “Get started” or “My friend referred me,” and they will be directed to different pages.
This lets them separate new customers from returning ones, allowing them to tailor their experience based on their position in the funnel.
Here is what the page looks like for users who select “Get started.”
Here’s what the page looks like if the customer selects “My friend referred me.”
Regardless of which option the user selects, they are sent to a page with clear instructions and minimal distractions. It isn’t cluttered with other information, just simple instructions.
Simply having a referral program, regularly reminding your customers about it, and having a clean landing page is not enough—you need to make sure that your call-to-actions (CTAs) are crystal clear to maximize your conversion rates.
There’s nothing worse than creating a complicated referral program that requires multiple steps to complete. Remember, you’re asking your customers to help you out; the least you can do is make it as easy as possible for them.
To create crystal clear CTAs for your referral program, you need to:
For example, Casper uses clear language to showcase their double-sided referral program. However, they took it a step further and split their referrals into two separate programs to target specific audiences.
This way, customers can share either mattress or pillow information with their friends and family, depending on what they think their referrals might prefer.
Each page is designed so that customers know what they are getting and what they will be giving their friends and family.
While referrals are great for growing your customer base, it’s your job to keep them there once they’re in.
Patch is an all-inclusive customer retention platform that’s geared towards helping you keep every customer that comes to your door (or website). We have a wide range of tools to help you get the most out of your referral marketing campaigns, such as:
With Patch, you can start optimizing your referral marketing campaigns and watch customers come in waves.
Schedule a demo and see what you’re missing!