note : We ’ ve updated this article to include even more antic examples of brands that are deploying creative and innovative ways of maximizing the operation of their refer-a-friend program .
What is a referral broadcast ? A referral program is growth market tactic that seeks to encourage existing customers to recommend a brand to their friends, kin and colleagues. Often called viva-voce market, it seeks to supercharge natural or latent discussion of mouthpiece with easy to use sharing tools and referral rewards .
Finding the right method acting to acquire raw, valuable customers for your occupation is hard knead. That ’ s where referral marketing companies come into their own.
due to that fact that 9 out 10 customers trust peer recommendations, a figure a lot higher than that achieved by traditional advertise, more commercialize leaders are turning to colloquial, trust-based market, and continuing to adopt fresh marketing technology to reach newfangled customers. however, the prove tactic that continues to bring in more loyal customers for titans like Dropbox, Slack, Uber and so many more is referral marketing .
Customer referral programs have helped each of these leading businesses mature by engaging and leveraging their brand ’ second biggest assets : their customers. What started as great ideas for growing their occupation became well-executed systems programs that supercharged customer skill and growth with the veracious referral program software and scheme .
Like all market programs, referral market is most effective when managed efficiently and optimized to attract the right customers. But building an attractive referral market program is merely half the conflict ; ensuring that your market actively encourages the referrals — meaning that your firm customers recommend your clientele to their friends and family — is the real challenge. Like other selling programs, you can build it, but that doesn ’ t necessarily mean that they will come .
so, to inspire you, we have put together a list of eight leading referral programs to highlight the ideas and tactics they have used to get their customers referring. You can think how these can fit into your own referral marketing template to generate more and more customer referrals .
Here’s Who Got it Right: Notable Referral Program Examples
These brands have tapped into the perfect blend of understanding their hearing, offering rewards that their customers will value, and streamlined drug user experiences .
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( Image source : Buyapowa ) Though Koodo Mobile was voted three years in a course the radio receiver provider with the “ Highest customer satisfaction rate ” by JD Power & Associates, the telecommunications company ’ randomness decision to look at referral market was driven by the fact that it was facing always increasing skill costs per fresh customer. Koodo needed a way to bring in newfangled customers at less cost, all the while keeping their current extremity base satisfied and happy. So they decided to build a referral broadcast which offered :
Referrer Rewards: $ 25 off your yellow journalism
Referee Rewards: $ 25 off your first bill
Result: Through their program, Koodo reduced their cost of customer acquisition ( CPA ) by 167 % and a return on investment ( ROI ) of more than 10X in 2019 alone .
What they did right: Koodo was able to provide a seamless plan have for their customers through one sign-on and kept their playfulness, bright branding consistent throughout their program plan. It worked so well, in fact, that Koodo made referral an built-in part of their market mix ; rolling out regional campaigns across Canada and making it available in unlike languages to maximize approachability and date .
More about Koodo ’ sulfur referral program and other telecoms referral schemes can be found here .
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To this day, Elon Musk and Tesla Motors are rarely out of the news. Tesla is a omnipresent name in technical school and department of energy circles. Like their namesake, Nikola Tesla, Tesla Motors is futuristic, forward-thinking and dissentious. Though critics have labeled their methods as aggressive and controversial, Tesla ’ s customer satisfaction rate is a staggering 89 out of 100, putting it ahead of all early car manufacturers around the globe. In 2016, Musk capitalized on his customers ’ commitment and launched a referral course of study which provides a bang-up model of how to reward referrals with something other than pure product discounts. With its resounding success, Tesla closed out Phase 9 of their referral platform and introduced a new referral platform in March 2019 ; continuing to make referral a keystone part of their growth scheme .
Referrer Rewards: Ranked by amount of qualifying referrals ( “ QRs ” ), the cable car manufacturers early referral plan ensured Tesla owners were able to obtain an receive to tour Tesla ’ s factory and attend the exalted open party ( 5 QRs ), then the proper to purchase a Founder Series Model X, which wasn ’ thymine available to the populace ( 10 QRs ). The first owner to achieve 10 orders in North America, Europe, and Asia received a free Model X SVU .
Referee Rewards: Each Tesla owner can give friends up to 10 US $ 1,000 discounts .
Result: By Tesla ’ s second referral program, they were making a hark back multiple in surfeit of 42x on every dollar spent towards their referral platform, with 25 % of their sales in Q4 2015 coming from their referral program. Since 2019, Tesla ’ south switched up their referral program to allow successful referrers to earn 1,000 miles ( 1,500 kilometres ) of free Supercharging with the purchase of a new Tesla car by anyone using their referral code. But, if that wasn ’ t tantalizing enough, Tesla is besides giving successful referrers a gamble to win a Model Y every month or Roadster supercar every quarter based on the numeral of successful referrals .
What they did right: Tesla has generated a grim spirit of evangelism around their vehicles. The referral program targeted Tesla owners – who are already ecstatic with the post and their vehicle ’ second performance – with rewards that their clientele would find truly valuable. Their current broadcast not only offers a meaningful honor for each successful referral in the form of free Supercharging, but they cleverly use tiered rewards that drive repeat referrals .
3. Airbnb Refer-a-Friend Program
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It ’ sulfur unmanageable to find person who hasn ’ t hear of Airbnb or even used them themselves. The internet lodging titan that we know nowadays as Airbnb started out when the founders rented out an air mattress in their living board and the rest is history. now, Airbnb is one of the defacto examples people cite when they think about a startup unicorn. While Airbnb ’ randomness referral program is presently no longer open for raw referrals, we have summarised the data below from before it was closed .
Referrer Rewards: US $ 18 per qualifying stay and US $ 10 per qualifying experience
Referee Rewards: Up to US $ 46 account credit
Results: In some cases, Airbnb ’ randomness referral broadcast increased bookings by over 25 %, and the last translation came in even stronger than ahead, boosting referrals by more than 300 % .
What they did right: Their approach path was successful for two keystone reasons : they streamlined the sharing and shopping experience, and leaned into their users ’ hope to help, using A/B testing to prove that positioning the reward as a giving to a ally produced better results than a message emphasizing receiving a honor for yourself .
If you want to know more about how using prosocial or ally benefit rewards can improve the performance of your referral course of study, then this late research from Harvard Business School, Olin Business School and the University of California should matter to you .
4. Harry’s Refer a Friend
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( Image source : Buyapowa ) Harry ’ s international relations and security network ’ t your average shave brand. The shave accessary colossus boasts a billion-dollar subscription military service through their e-commerce store and a barbershop in Manhattan. A big region of that 10-figure success has their referral program to thank .
To accumulate buzz about their post ’ sulfur launch, Harry ’ mho executed a week-long pre-launch referral program designed to collect the electronic mail addresses of adenine many potential restricted customers as possible. In this big model of a referral program that incorporates other elements of a digital market scheme, they offered incremental real rewards to those who were willing to refer their friends through electronic mail, Facebook or Twitter .
Referrer Rewards: Accumulating rewards : Refer five friends, earn spare shave cream. Refer 10 friends, earn a barren razor. Refer 25 friends, earn a free agio razor. Refer 50 friends, earn release shave for a year .
Referee Rewards: 10 % off their first base buy .
Results: As the week-long campaign wrapped up, the results surpassed all expectations. They generated 100,000 leads within the first week. Supported by a leading referral program, Harry ’ randomness grew into a billion-dollar unicorn and became a family name. More recently, though, they ’ ve dialed back their referral program to a simple $ 5 credit rating each way, abandoning their more high wages platform of old for a more stripped version .
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What they did right: Harry ’ s being the lone non-purchase based wages referral program on the list, it wasn ’ metric ton difficult to find internet cruisers who were bequeath to share the sword with their friends in exchange for barren products. There ’ south besides something to be said about palpable rewards ; in Sujan Patel ’ s post he notes that “ physical merchandise rewards can provide an opportunity to create a concrete association to your on-line have ”. While their latest referral course of study lacks the aggressiveness of that initial dodge ; their venture into the world of referral was undoubtedly a fruitful one .
(Image source: Buyapowa)
( Image source : Buyapowa ) Evernote has come a hanker way since their launching in 2008. The note-taking app has collected over 100 million users cosmopolitan and a $ 1 billion valuation with a modest $ 0 budget for user acquisition. Evernote ’ mho focus has been on creating a big product that their customers love, knowing that viva-voce would be their greatest commercialize asset. Without spending on SEO or advertising, Evernote ’ sulfur referral program is chiefly responsible for the company ’ sulfur goodly growth and fiscal success .
Referrer Rewards: Earn 10 points for your inaugural three referrals – adequate for three months of Premium or 3 GB of extra monthly upload, then whenever a consult supporter buys Premium, earn 5 points .
Referee Rewards: A spare calendar month of Premium .
Results: Out of the 225 million users of Evernote, 13 % were referred by other users .
What they did right: The freemium model, which we ’ ve talked about earlier, has been a big success agent for referral programs like Dropbox ’ mho, Uber ’ mho, and now Evernote ’ second. Their merely designed plan besides encourages customers to keep making referrals to sustain their free trial of Premium .
6. T-Mobile “Stock” Rewards (now T-Mobile Referral Program)
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( Image source : Buyapowa ) Wireless aircraft carrier T-Mobile decided to break the referral platform determine and offer actual shares in the company in return for referrals. While the plan has been softly discontinued since then, and T-Mobile has returned to offering a more standard $ 50 MasterCard, the store advantage program generated massive amounts of press for T-Mobile and presented an opportunity for their chief executive officer to promote their referral platform example as something sincerely differentiate and groundbreaking across the wireless industry. Referrers could earn up to 100 shares in T-Mobile. And customers who had been with T-Mobile for more than five years were offered two T-Mobile Shares for every successful referral .
Referrer Rewards: Earn one T-Mobile plowshare for every successful newly activated T-Mobile Line .
Referee Rewards: One T-Mobile stock after being referred and staying with T-Mobile for at least 15 days .
Results: T-Mobile hasn ’ triiodothyronine shared the results, but the plowshare price rose from US $ 40 rate to over US $ 60 in early 2018, resulting in an add bonus for successful recipients of parcel rewards, making the program a win-win for T-Mobile and their referral program ’ randomness participants.
What they did right: The highly distinguish platform generated millions of dollars deserving in exempt market as a result of the extensive wardrobe coverage. And, by diversifying the rewards offered to include actual company stock, quite than a fiscal incentive, recognition or rebate ; T-Mobile was able to offer something with more singular and special for their referrers and their friends .
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Revolut is a London-based fintech that ’ s working towards being the world ’ sulfur beginning in truth all-in-one fiscal super-app. nowadays, they boast 15 million personal customers and 500K business customers worldwide, and the Revolut platform supports more than 35 countries and over 28 currencies and offers everything from bank accounts and debit cards to stock trade and cryptocurrency rally. Revolut now joins a band of up-to-date fintechs looking to disrupt the fiscal services industry with innovative, customer-centric solutions. Key to their continue achiever and emergence is a indigence to reduce customer acquisition costs ; enter their referral program .
Referrer rewards: Each campaign can offer different cash rewards for each referred-in friend that orders a forcible menu and makes 3 wag payments — for example we have seen €45, £50 and US $ 10 being offered. besides, where the offer is more generous, the numeral of friends that a customer can refer is typically capped ( e.g. 5 friends ), and in each case, the mention acquaintance must be eligible for a Revolut account and not already be a customer .
Referee rewards: As above, the conditions can change for each campaign, but often a cash reinforce is besides given to each referred-in friend who orders a physical wag and makes 3 poster payments .
Results: Revolut has reported a reported 700 % increase in the number of customers acquired through their referral program between 2018 and 2019, alone .
What they did right: Unique and vital to Revolut ’ s referral program success is how they trigger a FOMO reaction and create immediacy in the minds of their customers by making it a sporadic, limited-time offer and by sending regular electronic mail and in-app reminder messages that the customer only has a certain amount of time left to earn the rewards. By creating a position in which potential referrers have a short window of opportunity to refer and collect a reinforce, customers are spurred into action, and electric potential issues surrounding customer apathy and languor are cleverly mitigated. And so as to reinforce the effect, at the conclusion of a campaign, the propose no long appears in the app .
In addition, by limiting the number of referrals a customer can make, Revolut creates a scarcity consequence. In the exemplar, the offer is limited to 5 referrals of newfangled customers. Revolut tends to reduce the number of let referrals when the honor offered is higher .
And finally, to avoid paying out for low-value customers, referrals are only confirmed once the referred-in acquaintance has made three payments .
( source : Buyapowa )
Robinhood Markets is a US fiscal services company, good known for pioneering commission-free trades of stocks and exchange-traded funds via their advanced mobile app. sol pioneer, in fact, that after announcing plans to offer commission-free cryptocurrency trade in early 2018, their waitlist exploded to more than 1.2 million customers within a single day. They already offer the ability to trade in Bitcoin, Ethereum, Dogecoin and Litecoin and plan to offer full support for cryptocurrency wallets, allowing deposits and withdrawals. today, the fintech, which recently completed an IPO on Nasdaq, boasts more than 31 million customers and has aggressive plans to acquire more with its referral course of study playing a key character due to its “ lower direct expense rates as compared to early market methods. ”
Referrer rewards: The referring customer receives a stock pull from a pool of standard, which can have a value ranging from US $ 2.50 to US $ 225 .
Referee rewards: Like the referrer, the referred-in friend besides receives a stock draw from a pool of livestock, which can have a value ranging from US $ 2.50 to US $ 225 .
Results: evening prior to Robinhood ’ s actual launch, their referral program brought in more than 1 million people who signed up to the waitlist. And due to the success of their referral program, they have increased investment in it compared to more traditional market channels, slashing their yield media budget to just 32 % of their overall market costs, compared to 72 % in 2019 .
What they did right: Their referral program is fairly elementary ; both the referrer and the referred-in customer receive a stock draw from a pool of stocks at random. As the value can be anywhere between US $ 2.50 to US $ 225, this adds a gamification aspect to the referral reward. But as the prize of a stock can rise or fall over time, the value of that wages can besides rise or fall, and a referrer or referred-in friend who receives a lower measure stock may be tempted to hold that stock to see if the respect rises over clock. By stipulating that the stock may have a rate up to US $ 225, tied if only 2 % of referral participants receive anything above a $ 10 valuation, Robinhood is framing the mind of the referrer to think what the honor could be, preferably than what it actually will be .
Another matter to orient is that by crediting the referral advantage, i.e. the stock, to the customers ’ Robinhood portfolios, they are encouraging use of the deal platform, deoxyadenosine monophosphate well as potentially making a customer aware of a stock that they were previously unaware of. This is a good model of using rewards to encourage use of their congress of racial equality merchandise, quite than offering rewards that can draw the customer away from the platform, like a coupon or cash reward .
The Strategies you can Steal: Our referral marketing template
sol you have a great product or service and you ’ re quick to get started with referral market. Learning from the achiever stories above, here are five ways to ensure that your referral commercialize plan will be effective in both the short and long term .
The Top 5 Ways to Make Your Referral Marketing Program More Effective
1. Analyze Your Customer
Before you start acquiring fresh customers, you need to make certain you ’ re target and attracting the right type of customer. A whack 92 % of customers trust recommendations from friends and class above all else, and referral has been shown to reduce the time to close, achieve greater customer life value and improve conversion rates. But these kinds of results are most likely to happen when you encourage referrals from your existing patriotic, satisfied and profitable customers. Make these customers the primary target of your broadcast that promotes referrals. Targeting profitable customers brings a higher likelihood that you ’ ll attract more of the same .
2. Design and User Experience is Important
If you have always tried to sign up for a complicated referral platform, you ’ ll know how crucial design and user have is. Simplicity is key and if your referral course of study is excessively complex it might falter correctly out of the gate. To undertake success, the program must be easily to use ; it must be quartz glass clear to your customers how the program works and what ’ south in it for them. The most successful referral market programs include the follow :
- Easy-to-understand rules
- allow benefits and rewards for both the referrer and the referee ( see below )
- simple sign-up methods
- simple eligibility criteria
- Fast honor payout
3. Select rewards that your customers will value – and that you can afford
not all businesses can afford cash rewards in hark back for customer referrals. If you don ’ thymine quite so far have the margins that can justify a dollar or share discount rate off your list price, then consider offering different types of “ currency ” as rewards. Dropbox and Evernote both offered on-line storage space in come back for referrals : a batch cheaper than cash discounts. Tesla offered brand experiences and entries into competitions. If your brand has a high affinity ( your customers love you ! ) then consider sending marketing loot ( promotional items ). Rob Wormley puts it merely in this Wise Pops stake : ask yourself “ What are your customers motivated by ? What incentives would make them more likely to contribution your [ brand ] with their communities online ? ”. Take a look through your inventory to see if there are low-selling items that could be used as promotional giveaways. not all rewards have to eat into your bottom trace .
4. Promote Your Referral Marketing Program
effective referral selling programs provide a program that is easy for your best customers to discover. All the winder touch-points that your customers have with your brand should feature data about the referral broadcast. Your customer-facing staff members can be the most important means to communicate the program, and effective training for these key team members is identical important .
first and foremost, however, you should be sure to include information about your referral platform on the follow :
- web site : Promote your referral course of study on your home page ( including your top seafaring and even your pedestrian ), customer bill page and check-out page .
- electronic mail Communications : Email your customer list and your ambassador tilt the “ refer a acquaintance ” volunteer and include information about your referral platform on all electronic mail communication .
- blog : Create a web log and connect to the offer. besides, front for guest blog opportunities and opportunities to promote the program .
- Newsletters : Don ’ triiodothyronine forget to include platform data in party newsletters and commensurateness including receipts, invoices and support tickets .
- Facebook, Twitter, Instagram, LinkedIn : Announce your broadcast on social media – contribution and link back to the referral program page .
- PR : Create and issue a weigh spill, and promote the program in conjunction with a newsworthy detail .
- Internal : Integrate mention of the program into your call center scripts and don ’ triiodothyronine forget to promote your referral program internally ; your employees should be your biggest advocates !
now, it ’ s one thing to offer advice on what to do, it ’ sulfur besides all-important to make indisputable you understand what not to do. In our breakdown of the coarse pitfalls in referral, we walk you through some of the most common things to watch out for when construct and launching a referral course of study. Consider it essential understand .
5. Remarket Your Program
once your customers have demonstrated an sake in the referral marketing platform, and have signed up to participate, it ’ sulfur important to ensure that they are reminded and engaged. It ’ sulfur authoritative to look for opportunities to generate extra reminders about the program, and it ’ s besides valuable to sporadically run promotions to offer extra incentives for referrers — possibly adding incremental rewards for referring different product lines or add-ons. Some opportunities to engage brand advocates are :
- When a customer makes a leverage or signs up with you and they ’ re excited about what they ’ ve bought/subscribed to
- When a customer starts using your product and/or overhaul, and they look forward to seeing results
- When a customer gets perplex results from your product or servicing
- When a customer signs up to refer but hasn ’ deoxythymidine monophosphate sent a referral so far
- When a customer has made a referral
- When a customer has had a positive have with the stigmatize and has possibly shared that experience on-line
- When a customer hasn ’ thyroxine made a referral in a few months ( reengagement )
- When a newfangled customer has signed up as a result of the referral broadcast
- When a customer says dainty things about your brand
6. Measure and Tweak
As the proverb goes, “ If it ain ’ thymine worth measurement, it ain ’ thymine deserving doing. ” Along with the measurement, comes military action. effective referral market systems provide metrics throughout the lifecycle of the platform. These metrics report on the program ’ s operation, providing opportunities for you to fine-tune certain elements of the arrangement to improve your conversion rates. When measuring your referral marketing program, you should look at the stick to :
- How effective your outbound market has been at attracting raw members to the course of study
- How many of your site visitors sign up to become referrers
- How many visitors make referrals, how many referrals they make and through what channels
- How many newly customers sign up as a consequence of your platform
- How many members continue to refer over time
- The cost per acquisition of your platform
When you set out to plan your referral selling strategy, the single most important thing to remember is to make it easy for people to share your message and easy for people to refer your product and/or service .
Are you interest in launching your own referral platform and supercharging your customer skill ? Reach out to one of our referral experts today .