Referral programs and incentive marketing are the two best ways to find new clients and employees, the first will bring a new audience and the second will make them loyal to your brand and increase your profit.
In this article, we will explain what a referral program is, the best way to build one, and how it is strictly linked to having a true emotional bond with your audience.
WHAT IS A REFERRAL PROGRAM?
A referral program is a different way for customers and employees to share your brand with the people they know.
It’s a marketing tactic that relies on word-of-mouth and having your audience advocating for your brand. The reasons they would do it are plenty and different strategies are involved in every referral program.
Usually, there is some sort of for people bringing a friend in. This works both for customers’ rewards or incentives for bringing a new customer in, and for employees who referred the right people to the company.
WHY A REFERRAL PROGRAM
Referral programs are nowadays extremely popular. We can think about apps such as Hype or Revolut, where if you bring a new client to these online banks, you get money, or employee referral programs, for instance, Amazon, where the employee gets a bonus if someone they refer starts to work for Amazon, too.
It is more effective than a paid marketing strategy and creates a higher return on investment, since people feel more connected to the brand if they know someone who is already a client or employee, rather than seeing an ad on social media or an open position in LinkedIn.
As a company, you want to create an advocate for your business, people who are so strongly linked to the brand that they feel like they want to talk about it.
WHEN IS IT RIGHT TO HAVE A REFERRAL PROGRAM
A good referral program can make a company go viral with low costs, if it’s designed properly. This was clear with the Dropbox case, where it became popular among a small number of people, who then shared it with their friends and colleagues. This made Dropbox the first and most used sharing platform for many years, nowadays competing with Google Drive and Microsoft OneDrive.
Of course, referral programs cannot work for every company and every product. You need to have a good LTV (Lifetime Value) a product that can work over longer periods of time and has already a good chance to be spread among colleagues and friends.
For instance, it is a great strategy especially for Business to Consumer companies and in the fast-moving good business. it is especially important for companies that do not already have a strong brand and want to increase their status and audience. It is less effective for durable goods, such as cars, and less for B2B companies, such as software or raw materials.
BUILD THE BEST STRUCTURE
A good referral program needs to be well structured. You need to have a clear idea of who your target is and how much money you want to invest.
The message of the referral has to be clear, and you have to think about the timing of your program. Whether it is related to a particular moment of the year, a holiday for instance, or if you want to run it for a longer period of time.
You must decide what the rewards will be, be it money, point, or something else, and whether you want to apply the same rewards to the person who is referring and the new customer. In other words, it’s fundamental that you have a clear and effective idea of what your goals are in mind, and you use all the knowledge you have in order to build the best strategy.
BEFORE REFERRALS: INCENTIVE MARKETING
If you have a good product, it is worth considering a referral program, but there is one important step to be done before. You need to have clients that are already loyal to your brand and that may want to share their experiences with others. Be it customers or employees, you need to create a strong bond with them before you start a referral program. This is where incentive marketing comes into play. The best way to create strong loyalty within your audience is a loyalty campaign. You need clients that already are committed to your brand and trust your product. The best way to make them feel appreciated is through a loyalty campaign with a rewards program.
The most effective way to do it is through gift cards. You can read more about loyalty in our blog.
We think we are the best platform on the market for incentive marketing, if you want to know more, here are some FAQs about loyalty programs and our company.
If you want to start the incentive marketing journey, you should have a strong platform and a qualified team to help you make the most out of it and get the highest return on investment. If you want to know more about why ROIWARD is the best choice and what we offer book a demo with us and let’s talk about it! We have the best platform, an amazing team, and the highest ROI!
If you still have questions, don’t hesitate to contact us, and let’s talk about it together!
You get ROI they get Rewards.
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