Potential customers will typically hear about your business in one of two ways. Either you are telling them about your business in some way (email, advertising, marketing, or calling), or other people (like coworkers or friends) are telling them about your business. The latter is what we call a referral.
As you might imagine, potential customers who are referred to your business from someone else convert at a significantly higher rate than those who are not. Most great businesses benefit from this phenomenon, even if they aren’t actively encouraging it. However, your can dramatically amplify this effect by creating an effective referral program.
Dropbox, for example, famously went from one hundred thousand registered users to four million registered users in fifteen months, largely due to a referral program. So, how do you encourage your customers to refer you to their friends?
This Webinar by Dan McGaw will walk you through the three elements that the best referral programs generally have in common:
- Happy customers.
- Reciprocal incentives.
First, you’ll want to ensure you have happy customers. Happy customers are more likely to refer their friends, but it can be difficult to identify which customers to target. This webinar will give you examples of qualities that you should look for in a referral customer, including a high lifetime value, low support ticket volume, and a large social media following. These and other factors will help you determine which of your customers are likely to participate in a referral campaign.
Reciprocal incentives are the second way to develop a successful referral marketing campaign. Reciprocal incentives mean that both groups of people—your customers who refer and new customers who sign up based on those referrals—get a benefit for participating. This webinar will give you several great ideas for incentives, which include free access to your product for a limited time, free promotional items, large discounts, or additional storage. You’ll also find a detailed referral program example from Code School, which is packed with ideas to help you get started.
Finally, a successful referral program requires reproduction: customers refer their friends, who then in turn refer their friends, and so on. To ensure that the cycle continues (that it is reproducible), you’ll want to ensure that your delivery method is easy for your customers. In this webinar, you’ll find examples of referral programs that use text messages, in application notifications, emails, and social media campaigns. You’ll also find specific numbers from Code School that show you exactly how successful their referral campaign has been.
If you want to take advantage of the benefits of word-of-mouth marketing, download this webinar to help you start a great referral program for your business.