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4 Steps to Implementing a Refer-A-Friend Program for Your eCommerce Site

Stefanie Florio • October 21, 2016


You don’t have to look much further than your own Facebook or Twitter feed to know that people love to share their experiences, opinions, or other knowledge. It’s human nature to let people know when things are going well (and also when they’re not). It’s also human nature for us to seek out and trust what our friends and family have to say about something.

So when it comes to what people are saying about your brand, there’s a huge opportunity to utilize and take advantage of positive feedback. As a digital marketer, you know the value that can come from a happy customer in terms of lifetime value. But even better is having that happy customer refer a friend to your business—double the lifetime value! As they say, the more the merrier!

Referral marketing can be one of the most impactful marketing programs you can add to your arsenal, especially if you have a unique value proposition or strong competitive advantage.  Your business is likely getting referrals of some sort, even if you aren’t aware of it (for example, by word of mouth). But there are ways to take a more active role in referral marketing to further accelerate your growth.

One method is to launch a refer-a-friend program. Refer-a-friend campaigns encourage your users to share your brand with their network, usually by offering some sort of incentive—and really, who doesn’t love a reward?!

Why should you consider a refer-a-friend program? Here are some of the highlights…

And now that you know the value in referrals, consider that more than half of people are likely to give a referral if offered a direct incentive, social recognition, or access to an exclusive loyalty program. So have I convinced you? Are you ready to get started with refer-a-friend program?

Launching a refer-a-friend campaign can be as simple or as complex as you wish to make it. As with any new program, there will be additional effort involved up front, but once the program is live, it can be relatively low maintenance to maintain.

Follow these four steps to launch your own refer-a-friend program.

Define the goals and objectives for the campaign. A refer-a-friend program can expand your customer base, improve ROI’s on customer acquisition, increase the lifetime value of current customers, and increase conversions. Define goals for each area so that you can focus your campaign appropriately and realize how effective it is. This will also help you determine down the road how you should adjust your campaign to make it more successful.

Select a vendor and integrate with your site. There are many options for vendors out there, including LYONSCG partner Social Annex. Factors to consider when evaluating a vendor are: ease of integration to eCommerce platform and ESP, A/B testing capabilities, user experience, segmentation capabilities, fraud monitoring, and support.

Decide how to execute your incentive program. There are many factors that can weigh into developing your incentive program, including cost per acquisition of other marketing channels, customer lifetime value, minimum order value, brand image, and fraud. If your brand is promotion conscious, this will be particularly important to consider when developing incentives.

Launch your program, and track and optimize your campaigns. Don’t set and forget your refer-a-friend campaign! Many platforms offer A/B testing which enables you to test varied creative, copy, offers, and targeting. Leverage these tools to continue to optimize your programs and increase acquisition. You should also be monitoring fraud activity to ensure that any abuse is minimal and not inflating the results of the program.

You’ve got customers who love your brand. Some may just need a nudge in the right direction to start talking about you. A refer-a-friend program can be just the tool to encourage your fans to actively talk about and share your brand with their friends and family.

Want to learn more? Check out our Digital Marketing practice.

Stefanie Florio is a Senior Digital Consultant on the LYONSCG Digital Services team.

Stefanie Florio

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Stefanie Florio

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