5 Steps To Optimize Your Referral Campaigns And Get More Customers

Published February 21, 2013 by Visakan Veerasamy+ in Optimizing Your Referral Program / ReferralCandy Updates
Getting the most out of your Referral Program

So you’ve got your referral program up and running. Sweet!

referral-program-setup

How do you get the most out of it, though?

1. Write succinct referral emails with strong Calls-To-Action.

When a customer buys a product from your online store, she receives an email from you (powered by us), with a coupon link for her to share with her friends. You can customize this email however you like.

Keep this email succinct.

After you’ve written it, read it from the perspective of your customer. Better yet, ask a friend (or ten) to read it. Ask them what they found confusing or tedious – they know better, because they don’t know your product as well as you do.(You know your product too well to know what throws people off.

The clearer the email and the call-to-action (“Share this link now to earn ______!”), the better your conversion rates will be. Here’s how you do it.

2. Structure your rewards well.

Rewards are better than no rewards. But who should you reward more, the customer or the friend she makes the referral to? How much should you reward them, exactly? (Ideally, you’ll want to reward them as much as possible, but you’ve got a business to run, too. Otherwise it’s free goodies for everyone!)

Most specifically, how should you distribute the reward that you’re willing to give?

As it turns out: If your brand is new, you should reward the customer making the referral. If your brand is more established, split the reward between the customer and the friend she refers to you. Here’s why.

3. Make it more visible.

We often overlook this because it seems so obvious, but a customer can’t make a referral if he’s unaware that he has option to do so. Not everybody checks their email. It’s worth reminding your customers (through social media, or on your site itself) that they do have that option, and that it benefits them.

The keyword is “benefit”. Why should he do it? You have to tell him! (Remember, you get to choose how the benefits are structured.) Are you rewarding him directly, or his friends, or both? Make it loud, make it clear. Here’s how.

4. Tweak constantly.

There’s no magic pill, or we’d all be using it already. Every business, market and customer base is different. You can’t know what works best until you evaluate the results that you get.

So don’t be afraid to experiment. Do your customers respond better to cash incentives or to discounts? You can’t know in advance! Try one, then try the other, and check your stats to see if your referrals go up or down. You might even find that your customers respond better to lengthy, heartfelt emails. Who knows? Go find out.

5: Don’t forget your business fundamentals.

Referral programs don’t magically create customers out of thin air or summon them from a mystical alternate reality. They simply accelerate the natural, organic process of sharing information (“Wow, this is great, I gotta tell everyone!”) by rewarding people for doing it.

Your customer must still like your product enough to want to refer it to his friends. Few people will refer a lousy product to their friends even if rewarded, because doing so would diminish their “social currency”.

So make sure you’ve got a great product to begin with, and that you focus on making your customer’s retail experience a great one- and then you can reap some truly delectable  returns from your referral program.

Still not seeing results?
Relax! It can take time for your customers to get around to using your program, and it can take even longer for their friends to use their coupons. You may experience a sudden spike in referral sales after a lull period. Tweet or Email us if you have any questions, concerns, anything!

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Visa is the co-founder of Statement.sg, a fashion ecommerce label selling witty t-shirts. He's been thrice named a Top Writer on Quora. He hopes to enjoy a glass of whiskey onboard a commercial space flight someday.