Referral Marketing has become a predominant strategy these days. Marketers are adopting this strategy more into their business as it gives them tremendous results. The reason behind its popularity is you don’t have to pull your hair in attracting potential customers. Your loyal customers do it perfectly.
Read this blog to know the effectiveness of referral marketing. Also, what strategies can you adopt to reach the zenith of success? Before going further, let us know what are the depths of referral marketing.
“A brand is not what we tell to the customers. It is what customers tell each other”.
You can never undermine the power your customers possess. They can help you flourish your business beyond your imagination. Yes, you heard it right. Referral marketing is a strategy to let your loyal customers perform all the networking and promotions to get more customers. It’s an ongoing cycle that provides you with mind-boggling results.
Your customers are your biggest ambassadors who influence potential customers via word of mouth.
Benefits of Referral Marketing
Blind trust in referrals
Your referrals are your loyal customers. Your loyal customers know your brand so they will only speak about the benefits of your brand. Remember you can only build trust when you meet the demands of the customers.
Higher conversion and retention rates
A business destiny lies in the hands of customers. In referral marketing, customers play an important role. People now believe more in their friends & acquaintances instead of advertisements and posts. This leads to higher conversion and customer retention rates.
Expansive market outreach
Your happy customers turn into brand ambassadors. They can turn the face of your brand from a small facade to a bigger and better reality when your customers influence their circle. The circle often grows and gets wider with time leading to an expansive market reach.
Track referral engagement
Tracking your referrals becomes a vital part of your business strategy. The reason for doing this is to know who is actually referring you to potential customers. Also, you must track referrals to know who you are rewarding.
Cost-effective with higher ROIs
It is a cost-effective marketing strategy as compared to other mediums. Why? Your customers are the promoters of your brand and so, you don’t need to invest much to access potentials. Also, your customers are your biggest assets who promote your brand further. These referred customers are likely to make more purchases resulting in higher ROI.
Benefits of the automated referral program
You can manage your referral marketing with the help of an automated referral program. This helps you to track the participants easily and get to know when referrers are interested, when they signed up as a referrer to, when they sent out referrals and, to whom.
Boost your brand value
Your current customers depict the lifetime value for your business. As you support them unconditionally, they value you more. In turn, you enhance the value of your brand.
Tips for an Ideal Referral Marketing Strategy
So, you have decided to adopt a referral marketing strategy to enhance your brand value. Before employing it, you must first know certain tips for an ideal referral marketing strategy.
Create strong relationships with customers
Before asking your customers to promote your brand you need to create a strong bond with them. How can you achieve this? By serving them at every step of their journey. Know their preferences and fulfill them with the utmost attention.
Give a feel-good factor to customers
Always display your brand’s USP to the customers which increases their urge to buy more and more of your brand. A unique trait of your brand can turn your customers into loyal ones.
Build an affinity with customers
Creating a bond with your customers is relevant for expanding your customer base. You can build a strong affinity through healthy interactions, working on their expectations beyond limits and asking for their feedback.
What are the Top Referral Marketing Strategies?
Give unconditional support to referrals
Providing exceptional customer experience to the users urges your customers to turn into referrals. Fulfill their needs, be attentive to their queries and provide them with catchy offers.
For example: You can send them reminders. You can use personalization in your interactions which further boosts your customer’s experience. Also, you can reward them to boost their purchases.
Set a page for a referral marketing plan
Create a referral program to track your referrals easily. First of all, set goals – What do you want out of a referral program. Know the sources of your referrals. How much conversion rate will be good enough for starting a referral program? Create a list of possible referrals – they could be the old customers, leads or your vendors.
Catch out influencers
Influencers are a great source of reaching out to your potential customers. As compared to your customers, you need to pay attention to the influencers who reach out to the customers. They do it via catchy posts and tutorials.
Use personalization to gain trust
Personalization is a great way to intensify trustful bonds with your customers. They somehow know that they are taken care of by the brand. A brand can offer discounts on the basis of the customer’s previous buying experience. Also, it can win their trust thereafter.
Launch a referral contest
If you want to generate brand awareness amongst people and increase your sales then build up a good email list in order to generate more leads. Then running a referral contest is a must for you. You can easily execute a contest through social media platforms. Create a profile or use it if you already have one to promote the contest. Set the agenda for your contest and choose the rewards and incentives for the users.
What are the Examples of Referral Marketing Program
Dropbox is one of the most famous referral marketing It began a referral program with a massive space of 500 MB to both the referrer and referral. This method works well as it generates signups up to 60 percent. Also, dropbox gives its users space as a referral reward to generate more customers.
Google for work
Google is already a household name. When such a brand utilizes a referral program to promote products, no doubt the techniques are effective. Google can fetch a massive amount of referral traffic due to its simple utility.
Uber is one of the most popular cabs providing services. Its referral programs generate surprising and successful results. The effect of uber’s referral programs is so successful that many companies have copied the concept. A great example of an uber referral program is providing a free ride to the customers. It is open to drivers as well.
The referrals of Airbnb is one of the most workable referral programs. The brand has brought a good knowledge of referral programs amongst the users. They provide a 2-way incentive program for both recipients and referrer. The recipients and referrers are entitled to receive some amount when the recipient completes his or her first trip.
A referral marketing strategy is incomplete without rewarding the referrals as it will create an urge in them to refer other potential customers. Customers are an integral part of your referral marketing strategy. Recommendations help in boosting brand value and propels the growth of business further.
A successful referral business helps in retaining current customers and fetching new ones.