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Strategies for a High-Growth
Ecommerce Referral Program

Trivia time - what do Uber, Dropbox, PayPal, and Airbnb have in common?

Any guess? No?

Let me tell you. All these big brands have in common is referral marketing. Referral marketing has indeed totally transformed these brands into top market brands. They used referral marketing strategy to rapidly expand their consumer base.

Now you know what secret weapon they used to reach the pinnacles.

Despite knowing these popular success stories, still many eCommerce marketers often overlook referral marketing strategies when they are planning marketing strategies for their businesses.

There are plenty of marketing strategies out there in the market. However, referral marketing is among those strategies that give better results in less time.

Your satisfied customer can be great advocates for your brand. You can use them to expand your consumer base in less time and increase your store conversion rate.

When your existing customers refer your brand to their family, friends or peers, it means they’re highly satisfied with your service and they want others to buy from you.

When these new customers become a part of your consumer base they tend to stick for a longer period with you. Hence this will help you in expanding and growing your business on a massive scale.

If you’re still thinking about whether you should start referral programs on your eCommerce, you’re probably missing out on a lot of potential customers.

But from where to start?

In this article we’ll walk youthrough the tools and strategies to run a high-growth successful eCommerce referral program.

Using referral marketing tools for referral programs

You may find plenty of referral marketing tools that you can use to start your referral programs to improve your sales conversion rates.

Referral System for WooCommerce - a complete solution to kick start your unique referral marketing programs. It’s a referral marketing plugin developed by Codup that allows eCommerce merchants to customize your referral programs according to your customers’ needs.

It integrates exceptionally with WooCommerce Points and Rewards Extension. It offers some other handful additional features like

• Setting different discount types and settings

• Customizing referral emails

• Setting expiry dates of points and discount coupons

Choosing the right referral marketing strategy

Not every referral program will work for your eCommerce store. Some might bring extra sales while some will be a complete disaster. So before jumping on this bandwagon you need to understand what will best for your online business.

Customers won’t simply refer your company to their peers or family members because you asked them to do so, you need to deliver outstanding customer experience to persuade them to refer you.

You need to find out what motivates your existing consumer base. Once you’ve found out, leverage it to build your eCommerce referral program.

Below we’ve enlisted a few strategies that eCommerce marketers can use to keep the balance between what you as a marketer value and what your customers value.

Offer cash rewards

PayPal in the beginning was just like any other startup - no traffic, no customers, no sales, no revenues. So to start their business venture they began investing in their members. They started a referral program in which they offer cash rewards on sign ups.

With this small seed they kick started their business and within a few months they reached 1 million subscribers.

However in this journey you need to make sure the money you’re investing is not going in the bin

Basecamp, a popular project management software, took this approach and started a referral program in which they used to offer $50 cash rewards. They used to give $50 to the referee and the referee.

They used various channels to promote their referral marketing programs. They wrote blog posts on their referral programs, They promote it via modal pop-ups and social media communities.

This sort of referral program doesn’t require much resources. You just need a couple of things like a PayPal account, a software to create discount codes, and a portal to keep an eye on referral traffic.

Using shoppable quizzes and wheel of fortune

If you’re unable to offer monetary incentives, think something out-of-the-box and think of a unique referral program. You can use shoppable quizzes and wheels of fortune as referral programs.

Customers enjoy these things and love to brag about their win on their social media profiles. When they share your fun referral programs on their profiles, it will encourage their friends also to join your referral program to win free gifts.

You can also make quizzes to categorize your customers before offering them a reward. In this way you’ll be able to understand what motivates your customers and what you should offer to them as an incentive.

Free account upgrade

If neither of the above strategies are feasible for you it doesn’t mean you are off the race. There are plenty of other referral marketing programs you can start like offering free additional services.

As a referral incentive you can give customers access to new services or products, extend warranties, free account upgrades etc.

All you need to do is to figure out what your customer values the most and then offer them that in exchange of referrals.

Dropbox took advantage of this referral program and offered additional storage space to customers who bring referrals. By offering additional storage space to their customers they were able to expand their consumer base in less time.

In a 15 months period they were to get 40% more active users through this referral marketing strategy.

They designed a simple landing page for their referral marketing program. All they asked customers to enter their friend’s or peer’s email address so an invite can be sent to them directly.

They allowed their existing customers to import their Gmail contact list, share the program on Facebook or copy the link and send it to their contacts.

Each method allows customers to promote this referral program on their social networks.

Choosing your strongest advocates

A satisfied customer has the potential to be the strongest advocate of your brand. An existing customer is capable of bringing at least 2-3 referrals. All you need to do is find those customers who are capable of referring your brand to their peers, friends or family.

Finding such potential customers is easier than you think. You can use tools like the NPS survey system to easily target your strongest advocates.It allows you to categorize your advocates into 3 groups,

Promoters - loyal customers who will keep purchasing from you and refer your brand to others.

Passives - satisfied customers who are incapable of referring your brand to others.

Detractors - unhappy customers who damage the image of your brand through bad word-of-mouth.

Airbnb uses NPS surveys to track their strongest advocates. They use to run simple email campaigns to gather feedback from customers before outreaching their customers for referrals.

Final Thoughts

To improve the customer experience on your eCommerce store and expand your existing consumer base you can use referral marketing strategy. There are multiple referral marketing programs that you can use.

All you need is to find what your customers value and then formulate your referral marketing strategy to win more referrals in less time.