7 Pitfalls To Avoid In Your Referral Program
Having a referral program ensures that current customers will recommend your business to their friends and family. Yet, merely launching your referral program won't ultimately guarantee more referrals and hundreds of new customers making their first purchase.
The ideal referral program should be integrated with your brand's sales funnel. Sometimes your brand advocates don't want to join the referral program immediately. Your incentives may not be compelling in some cases, or people could be unaware of it.
So, what are the pitfalls that you have to avoid? Here are the tips that you need to know.
The ideal referral program should be integrated with your brand's sales funnel. Sometimes your brand advocates don't want to join the referral program immediately. Your incentives may not be compelling in some cases, or people could be unaware of it.
So, what are the pitfalls that you have to avoid? Here are the tips that you need to know.
1. Poor customer satisfaction
Unlike most marketing tactics, referral programs rely on the satisfaction of your brand advocates.
Recall the last time that you gave a referral to your network. We bet you only recommended the best of the best products or services that you've encountered. If your favorite brand launched a referral program, you would easily sing praises and persuade your friends and family to try it out too. In contrast, a product with poor services won't even be on your radar, even if they launch a referral program with tempting rewards.
As a result, you must focus on building a long-term relationship with your customers. Your brand advocates are the people more likely to promote your brand, so keep them satisfied. Launch a referral program and reward them for continuously patronizing your brand. Give them personalized product recommendations and improve your user experience.
More satisfied customers mean more brand advocates. Consequently, this leads to an increasing number of referral program participants and new customers entering your sales funnel.
Recall the last time that you gave a referral to your network. We bet you only recommended the best of the best products or services that you've encountered. If your favorite brand launched a referral program, you would easily sing praises and persuade your friends and family to try it out too. In contrast, a product with poor services won't even be on your radar, even if they launch a referral program with tempting rewards.
As a result, you must focus on building a long-term relationship with your customers. Your brand advocates are the people more likely to promote your brand, so keep them satisfied. Launch a referral program and reward them for continuously patronizing your brand. Give them personalized product recommendations and improve your user experience.
More satisfied customers mean more brand advocates. Consequently, this leads to an increasing number of referral program participants and new customers entering your sales funnel.
2. Not enough promotion
Sometimes customers don't join your referral program, not because they don't want to. They don't even know that it exists in the first place.
That's precisely why you need to keep promoting your referral program. Create marketing content to encourage customers to join and learn more about the process.
For example, Shutterfly - a retailer for photography products - lets customers know that they can earn rewards and get prizes in exchange for inviting their friends. In turn, their friends can get a free photo book or cotton tote.
That's precisely why you need to keep promoting your referral program. Create marketing content to encourage customers to join and learn more about the process.
For example, Shutterfly - a retailer for photography products - lets customers know that they can earn rewards and get prizes in exchange for inviting their friends. In turn, their friends can get a free photo book or cotton tote.
Likewise, Indochino - a designer brand for custom suits - sends a referral email to encourage current customers to join.
Not only that, but planting a tree for successfully referring a friend is a worthy cause.
When customers share their unique referral offer, it'll naturally segway into discussing the brands passion for sustainability and veganism. This makes it easy for brand advocates to convince their friends and family to sell your product.
When customers share their unique referral offer, it'll naturally segway into discussing the brands passion for sustainability and veganism. This makes it easy for brand advocates to convince their friends and family to sell your product.
A good tip is to promote the benefits of joining your referral program. Be upfront about the rewards customers can earn to incite action.
3. Difficult to sign-up
A complex sign-up process could be the culprit to only a few sign-ups.
For instance, customers may have to wait for a confirmation email before they can invite friends. Alternatively, consumers may have to surpass several hoops before they can register and make a successful referral.
Of course, consumers want the referral process to be as fast as possible. Ask for their email address and quickly send the referral code. Also, make sure it's easy for them to obtain the rewards for successfully persuading their friends.
For instance, customers may have to wait for a confirmation email before they can invite friends. Alternatively, consumers may have to surpass several hoops before they can register and make a successful referral.
Of course, consumers want the referral process to be as fast as possible. Ask for their email address and quickly send the referral code. Also, make sure it's easy for them to obtain the rewards for successfully persuading their friends.
4. Poor incentives
It takes time and effort to convince a friend to try out your product. As a result, think about the meaningful incentives that you can offer. Whether big or small, you can think of appropriate rewards that will make the process worth it.
For example, the HelloFresh referral program gives brand advocates the option to send a free meal or a $40 discount off their friend's first purchase. These deals make it easy for brand advocates to sell your business and get their friends on board.
For example, the HelloFresh referral program gives brand advocates the option to send a free meal or a $40 discount off their friend's first purchase. These deals make it easy for brand advocates to sell your business and get their friends on board.
5. No customer feedback
The customer is king, even when it comes to launching your referral program. If you notice a significant drop in engagement, ask for user feedback.
Here are some questions that you might consider asking:
Here are some questions that you might consider asking:
- On a scale of 1-10, how would you rate your referral program experience?
- What do you like about our referral program?
- Do you have any comments or suggestions about our referral process?
6. No follow-ups
Have brand advocates ignored your referral invite email? Did they not click the referral program pop-up? Send a follow-up email and encourage them to join again.
You can send a follow-up referral email after two weeks or one month. Alternatively, you can also come up with non-intrusive ways to promote your referral program. You can mention the referral program at the bottom of your promotional emails.
For example, the bottom of Casper's email reminds customers that they can earn a $75 Amazon gift card, and their friends can get a 10% off discount on their new mattress.
You can send a follow-up referral email after two weeks or one month. Alternatively, you can also come up with non-intrusive ways to promote your referral program. You can mention the referral program at the bottom of your promotional emails.
For example, the bottom of Casper's email reminds customers that they can earn a $75 Amazon gift card, and their friends can get a 10% off discount on their new mattress.
7. Impatient to reap the benefits
Good things take time—and the same goes for referral programs. It takes some time for businesses to grow their brand advocates and encourage them to promote their brand. If the referral program doesn't match your expectations, then wait it out.
Perhaps customers need some time to convince their friends. In the meantime, focus on building great products and relationships with your current customers. Boosting your number of satisfied customers is key to scoring more referrals.
Consider experimenting on your referral program incentives. Sometimes you must start small because of a limited budget, and that's perfectly okay. Figure out whether customers are more receptive to cash, freebies, or discounts. Just like every marketing campaign, you must analyze the results and figure out ways to improve.
Perhaps customers need some time to convince their friends. In the meantime, focus on building great products and relationships with your current customers. Boosting your number of satisfied customers is key to scoring more referrals.
Consider experimenting on your referral program incentives. Sometimes you must start small because of a limited budget, and that's perfectly okay. Figure out whether customers are more receptive to cash, freebies, or discounts. Just like every marketing campaign, you must analyze the results and figure out ways to improve.
Launching your referral program
Launching a referral program doesn't immediately lead to hundreds of brand advocates promoting your referral program.
It takes time to perfect your referral process and to promote your program. In the meantime, focus on increasing customer satisfaction and customer retention. Loyal brand advocates are the people most likely to promote your business and succeed. Building a long-term relationship with these customers is the main ingredient to better results for your referral program.
It takes time to perfect your referral process and to promote your program. In the meantime, focus on increasing customer satisfaction and customer retention. Loyal brand advocates are the people most likely to promote your business and succeed. Building a long-term relationship with these customers is the main ingredient to better results for your referral program.
POSTED ON OCTOBER 9, 2020
Genius Referrals Team.