Referral programmes that work – 6 top tips
The other day I was chatting to an ambitious entrepreneur who has built an avid and sizeable following for his brand, having run a successful campaign on Kickstarter. His fans believe in what the company is trying to do and they want them to succeed. So he was shocked and hugely disappointed when they launched their referral program and got basically no interest. It got us thinking, why do some referral programs work amazingly well and others simply don’t chime with customers? After all, just last week we looked at the exponential growth Monzo enjoyed, in large part thanks to their referral program.
Here are our top tips for what you might want to consider before you embark on this type of growth activity.
1. Is your customer base ready for a referral program?
Make sure you don’t offend your customers by something as transactional as a referral program. If they’re early adopters, they might feel a huge sense of belonging to your brand, and may consider themselves as almost part of your team - rather than just mainstream customers - and would probably be more than happy to drum up business for you without the structure of a referral program. They want to help because they love what you do, so a personal thank you from the CEO, a rise in status within the customer community, or an out-of-the-blue gift will motivate them far more than a voucher, a discount or even straight cash.
2. Do your research
You would be surprised many people go all in without checking whether their customers might be willing to get involved. Ask them first, and ideally get a number of them involved in your planning process. Test with them and make sure they are on board with this type of activity. If you involve them first they are more likely to support the initiative when you go live, which will help with modelling the type of behaviour for the rest of your customer base.
3. Make sure you offer something your customer base actually appreciates
If you do launch a formal referral program, make sure the offer chimes with your audience. For example, if your customers are quite wealthy or senior, an offer of a couple of quid to introduce their possibly equally senior friends might not move the dial for them. It must be something that means something to your particular audience. And that doesn’t always have to be money.
4. Be creative
We’re all inundated with referral requests nowadays, so how is yours going to cut through? What can you do differently from the money-off or the cash-back strategy? Be playful with it and be authentic with your ask. Too often you see “out of the box” standard offers that are almost offensive for how little thought and effort has been put into them. You might see it as a lovely, simple automated process or a program but never forget you are asking your customers to introduce their contacts to you and spend their hard-earned cash with you. Put yourself in their shoes and if you wouldn’t appreciate the ask you are considering launching then you know you need to have a rethink.
5. Keep it simple
Make the referral process complex / time-consuming and you will lose people. Keep the friction to a minimum so people don’t need to jump through too many hoops to help.
6. Don’t panic
Finally, don’t jump too quickly to the conclusion your program is a dud. Of course, you can’t wait forever for it to potentially take-off but always remember new things often take time to bed in. Make sure you have a strong comms plan around any activity (the message will need to be repeated multiple times on probably multiple channels) and if you are still not seeing any movement after a while, get feedback. It might not be a case of it being completely wrong - it just might need a tweak here and there.
Good luck and let us know if you have any other top tips we can share with readers. Equally, if you have come across some particularly innovative programs, please do let us know.
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