Referral program marketing is one rather successful approach for fostering client acquisition and growth. If you want to really utilize their opportunities, however, you should have a good plan. This article will go over nine tried-by-fire strategies to help your referral program grow and change your business. 

1. Optimize your referral program for easy participation

1.1. One-click sharing options, create referral links

Make it easy for your fans to share their unique reference links. This is one of the most important parts of a successful referral program.

Don’t know how to do it? Don’t worry. We’ll talk about how to make referral sharing easier with one-click sharing choices and referral links that are simple to make.

Here are some tips to simplify your referral program for easy participation:

• Unique referral links

In real life, a referral link is a secret code that looks like a web address. It keeps track of who sent you the link and what pages you visit on the site.

Members receive their unique link when they sign up for a referral program. Your link directs them to the website and notifies the business that you sent them there. Additionally, they will receive a reward if they register or make a purchase. It benefits all parties involved.

There are three ways to create referral links:

• Manually. Your own website might help you to establish referral connections. But be cautious as this calls for new link setup and domain configuration changes.
• Free shorteners. Create shorter, shareable URLs using a free service like bit.ly.
• Use a free link generator. A free application called Referral Rock allows you to create a unique code for every friend and choose where the link points.

Read more detailed tutorial at  How to create referral links for Shopify stores? [With examples].

• One-click sharing options

Once a supporter has their referral link, they can start telling other people about it. Most of the time, people give recommendation links via email, text message, or social media sites like LinkedIn, Facebook, and X.

People also like to share in secret chats and social media groups like WhatsApp or Facebook groups. Give them simple ways to share, like social media buttons or email forms that are already written. Send follow-up messages to get people to share again.

1.2. Build user-friendly referral landing pages

For people who sign up for your referral program marketing, the referral landing page shows them the perks they can get, like a coupon code for a discount or something for free when they get someone else to sign up.

For inspiration, check out Adore Beauty’s referral landing page. It’s a great example of a well-designed page.

As you can see in the above image, a successful referral landing page usually includes the following:

• A catchy headline clearly states the reward. For example, “Give $20, receive $20”.
• A simple explanation.
• A quick sign-up form.
• A FAQ section to answer common questions upfront.
• Referral program terms and conditions to provide a clear explanation of the rules.
• A captivating image to grab attention.
• A strong call to action to tell visitors what to do next (e.g., “Join Now”).

1.3. Clear communication of rewards

Make the requirements for getting awards very clear. This could be the minimum buy amount, the number of referrals needed, or any other special conditions.

You can use short, clear wording to explain how the rewards work and who is eligible. Don’t use slang or scientific terms that people might not understand.

2. Offer attractive rewards that motivate users

2.1. Choose monetary vs. non-monetary rewards

47% of consumers get excited when they get a special deal, according to a study by Kelton and SheerID. In other words, a strong reward is what makes a suggestion program work.

We will recommend some strategies to offer attractive rewards that motivate users:

Monetary rewards:

• Cash rewards. Directly reward users with cash incentives for each successful referral. This approach can be highly motivating, especially for those seeking financial gain.
• Gift cards. Offer gift cards to popular retailers or online stores. This allows users to choose their rewards, increasing satisfaction.
• Donation to charity. Offer the opportunity to give a part of the referral earnings to a charity to users who care about doing good.

2.2. Non-monetary rewards:

• Early access to sales and promotions for both the referrer and the referee.
• Free products or services to incentivize referrals. This can be especially effective for businesses with high-value products or services.
• Loyalty points: Integrate the referral program with your existing loyalty program. Reward users with loyalty points or rewards that can be redeemed for future purchases.
• Experiences like VIP access, behind-the-scenes tours, or personalized consultations. These can be highly motivating for certain demographics.

So, when should you choose monetary or non-monetary rewards?

In our option, if your product or service is relatively expensive, a monetary reward can incentivize referrals for high-value purchases.  

If your product or service is relatively inexpensive, non-monetary rewards can be a cost-effective way to incentivize referrals.

2.3. Offer tiered referral program

A tiered reward system (milestone referral program) is a great way to motivate users to show their friends about your app. You can keep users inspired and interested by giving them bigger and bigger benefits as they reach certain goals.

Here’s how a tiered reward system works:

• Tier 1: For the first few referrals, offer a basic reward. Such as a small discount or a free product.
• Tier 2: As users reach a certain number of referrals, increase the reward. It offers a larger discount or a premium product.
• Tier 3: For the most dedicated referrers, offer exclusive rewards. It includes VIP access, personalized experiences, or significant discounts.

We will give a more specific example of milestone referral program in the image below: 

For companies with significant sales volumes, especially those where one referrer is expected to generate numerous successful recommendations, milestone referral program usually work well. They also work quite well for companies wishing to provide more unusual one-time incentives.

3. Leveraging email marketing for referral program success

3.1. Crafting compelling referral emails 

Not only does sending reference emails to your satisfied customers bring your devoted followers back to your online store, but it also attracts fresh business with no work (thanks email automation). 

But here’s the catch: even with the best incentives, your customers might miss your referral email. This is why it’s crucial to draft a referral email that will get in the inbox, be opened, and attract your existing customer’s attention. 

We’ve got a few tips to help you do exactly that:

• Use a high-converting referral email subject line:

Keep it clear and concise. A subject line like “Get 10% Off and Help a Friend Too!” is both informative and intriguing.

Also, we advise that your subject line include an emoji. Emojis in the subject line increase people’s likelihood of opening your email by 54%, according the Nethunt research.

• Get straight to the point:

Don’t waste your customer’s time. Make your referral offer crystal clear with a strong call to action, a catchy slogan, or a prominent referral code.

• Show the referral incentive:

One of the most important parts of referral program marketing is offering rewards. The reward for referring friends should be clear and easy to understand, and it should show your followers why they should support your brand.

For example, Riff Raff & Co. is an online store that sells items for babies and toddlers. The above referral email design had a 24% referral rate, much above the industry average. 

Here is why we love this referral email example:

• They write copywriting and brand voice, and they talk to their ideal customers directly.
• The use of bold text to highlight important things about the referral program.
• Free mail for friends and a second sleep toy are clearly shown in the email.

3.2. Segmenting email lists

You can see how much each customer is worth and what products they are interested in when you integrate your email marketing tool into your e-commerce provider. This information can help you get high-value, loyal customers who love your product to join your referral program. 

3.3. Automated referral reminders to time your emails

Making sure you automatically send out your referral program at the right time is the next step after figuring out who you want to refer. 

Here are some times that we think are good:

• Post-purchase, immediately after. This is when you should send a referral email most of the time, but it doesn’t always work. At this point, buyers are satisfied since they bought something from you. But telling first-time users to talk about your products before they even get it might be a little strange.
• Post-purchase, once they’ve received the product. It depends on your “goals” and whether you should send this group a review email or a referral email. 

But now is a great time to get them to spread the word, especially if they’re happy with what they got in the mail.

4. Use social media to amplify referral reach

You don’t have to come up with a new way to promote your referral program on social media all from the start. Here are some brands that are already doing social sharing right now. Copy the ideas that you think will work best for your business.

4.1. Referral program promos on Facebook, Instagram, and Twitter

Aisle is an online store that sells sustainable period goods. They sometimes post ads on social media to promote their referral program. 

By using social media to promote a referral program, Aisle can not only get its brand in front of a very specific group of people, but it can also get two effects from each acquisition: new customers and referrals.

4.2. Hashtags and collab with influencers

Calvin Klein, an American fashion house and underwear brand. They have show how partnering with influencers to promote your referral program from its #MyCalvins hashtag campaign, which became popular in 2015. 

It is still going strong with influencers like Win Ynny. Popular social shopping sites like Instagram and X were used for the campaign. 

4.3. Post highlight stories on social media

The creative underwear company MeUndies uses Instagram Stories to spread the word about a deal where fans can get $20 in store credit. Also, their friends can get 20% off their first order. The brand uses personalized URLs (PURLs) as a way to track referrals.

This makes it easy for customers to share on social media and messaging apps by copying and pasting their reference links.

5. Implement referral program marketing tracking and analytics

5.1. Recommended referral tracking tools

You should set up strong tracking to see how well your referral program marketing is working. This will give you useful data about how many people refer to others.

Here are some popular tools that can help you track your referral program’s performance for you:

• BON Loyalty app is a comprehensive loyalty platform that offers detailed analytics. It includes the referral source, conversion rates, and customer lifetime value.
• ReferralCandy is a user-friendly tool that provides insights into referral traffic, conversions, and revenue generated.
• Yotpo is a platform that combines reviews, loyalty, and referral programs. It offers referral program analytics to track customer behavior and referral performance.

5.2. Key referral program metrics to track

After setting up a strong referral program and picking the right tracking tools, it’s important to keep an eye on and examine key data to see how well it’s working. If you know about these measures, you can make smart choices about how to improve your program.

Referral Conversion Rate:

Referral Conversion Rate = (Number of Referred Customers Who Completed a Desired Action / Total Number of Referred Customers) x 100%

This metric shows what percentage of buyers who were suggested actually do what you want them to do, like buy something or sign up for a service.

If your conversion rate is high, it means that your referral program is working to bring in new customers.

Cost Per Referral (CPR):

CPR = Total Cost of Referral Program / Number of Referrals Generated

CPR figures out how much it costs on average to get a new customer through a recommendation. By calculating CPR, you can using data analytics to improve referral program performance.

Customer Acquisition Cost (CAC):

CAC measures the total cost of acquiring a new customer. By keeping track of CAC, you can see how well all your marketing efforts, including your referral program.

5.3. A/B Testing: How to test different referral incentives, messaging, and channels.

Once your referral program marketing button is in place, you can experiment with different versions to see what works best. Try tweaking things like:

• Size: How big should it be?
• Placement: Where on the page should it go?
• Color: What color grabs attention?
• Call to Action: What words encourage people to click?

Let’s try analyzing the airbnb referral emails in the image below:

Referral incentives:

• Version A: Both the referrer and the referred friend receive $25 in travel credit.
• Version B: The referrer earns $25 in travel credit, and the referred friend receives $25 off their first booking.

Messaging and tone:

• Version A: Focuses on the mutual benefit, emphasizing that both parties earn rewards. The messaging is direct and straightforward.
• Version B: Uses a more persuasive tone, framing the offer as a gift to friends. It highlights the flexibility of the offer, mentioning “weekend getaway to an overseas adventure.”

Channels:

• Both versions appear to be email-based referral programs.

In our choice, think about how each method will affect things in the long run. Version B might get people to promote others at first, but Version A might get people to stay engaged and loyal over time.

6. Promote your referral program across multiple touchpoints

6.1. Placing your referral program website banners and pop-ups for maximum visibility

People can’t share something if they can’t see it. Where you put your referral widgets and other assets (like links to a separate referral program marketing page) will have a big effect on how well they work.

Bear State Coffee’s referral program banner looks like this. In the bottom right corner, you can see “Get $20.”

What they’re asking people to do is easy, and the color red really stands out. When visitors click on the red ribbon, an overlay widget will appear right at the top of any page on your website.

6.2. Introducing your referral program during onboarding email

When a new customer signs up for a product or service, you can send them an onboarding email to tell new users about the referral program. Kali Bennett, owner of The Waterworks Spa Sauna Swim, states,

“We‘re always looking for ways to improve our onboarding. In addition to helping our new clients get to know our company, it’s an opportunity to make them feel extra special and help them understand what comes next.”

In the same way, a new customer is interested in your goods or services and wants to share with their friend. 

6.3. Introducing your referral program at checkout or after purchase 

If your products have a short buying cycle, we recommend introducing your referral program right after a customer purchases. It will motivate them to earn rewards for their next purchase. 

It may seem too early for you to do this since those customers haven’t even tried or gotten your product yet. It’s all right. We’re just making people aware of the problem early on, which is a simple thing to do.

7. Create a sense of urgency with limited-time offers

7.1. Flash referral events

It is possible to improve performance through a limited-time offer (LTO) in referral marketing, just like it is in other marketing platforms.

Look at the picture below to see how Friendbuy uses flash promotion events. The time range “JUNE 1ST – JUNE 14TH” makes things seem urgent, which makes people more likely to act right away. 

The caption “$15 BONUS FOR EVERY FRIEND YOU REFER” also gets people’s attention right away and makes the advantage clear for the person who refers to someone.

7.2. Seasonal Promotions 

Targeting customers during the holiday season is also a great idea. While you have an ongoing “general” referral campaign, you could have a separate one just for the festive period with a different seasonal perk that comes along with it.

Even your referral messaging, email design, and landing pages can all be catered to the holiday event. A limited-edition benefit would work super well as it plays a role in humans’ fear of missing out (FOMO) behavior.

CVG, likely a clothing or fashion brand, uses National Best Friends Day to get people to tell their friends about them. This referral program promotion is more personal and useful when it is linked to National Best Friends Day.

You can get more ideas at the 40 best referral program examples by industry.

8. Gamify the Referral Process

8.1. Referral leaderboards

With referral leaderboards, customers are ranked by how many good referrals they make. It makes the process more like a game.

For instance, a fitness app might have a monthly ranking where the top three referrers win special rewards. It includes free personal training lessons, discounted items, or other referral program rewards.

8.2. Referral challenges 

A milestone giveaway referral program is a smart way to motivate your customers to spread the word. You set specific goals, like a certain number of referrals or total sales from referrals. When your customers reach these milestones, they earn rewards like exclusive perks, swag, or discounts.

Morning Brew, a popular newsletter, uses this strategy to grow their subscriber base. They offer a tiered reward system. The best part? This approach is cost-effective, often yielding lower customer acquisition costs than paid advertising.

8.3. Badges and achievements

A recent survey by Lacek showed that a whopping 87% of users felt more excited, engaged, and motivated when they received a digital badge. These little virtual rewards can significantly boost customer engagement and loyalty.

When users earn a badge for completing a task or reaching a milestone, it feels like a real accomplishment.

9. Engage your top customers as brand ambassadors

9.1. Identify your top customers 

To reward your most loyal customers with badges or leaderboard rankings, you first need to figure out who they are.

Tools like Google Analytics, CRM software, or referral programs apps can help you track where your new customers are coming from. You can also directly ask your customers how they heard about you through surveys, feedback forms, or customer reviews.

By analyzing this data, you can identify your top referrers and the most effective channels for generating referrals.

9.2. Offer exclusive ambassador perks 

You should start your brand ambassador program with a good set of perks. You should choose more than just the type of reward for brand ambassadors. It would be best if you also decided how they will be paid.

We will recommend some of the most common ways that brand ambassadors are rewarded:

• Branded swag is a fun gift that can be used to welcome new brand ambassadors or let them know about a new ambassador project. You could also give branded gear for jobs that are finished, as long as it’s something useful, like a Yeti mug, a wool jacket from The North Face, or a bag from L.L. Bean.
• Public recognition. Showcase your best brand champions in blog pieces and social media posts. Honor people who have recently gone above and beyond, and say thank you in public. If they agree, you could also share their content on your page or even let a top ambassador take over your page for a day.

9.3. Create a community for ambassadors 

Ultimately, a long-term referral program optimization strategy is one that you need to encourage interaction and sharing within a private group to keep the momentum going.

Don’t worry if you’re a small business; we have a detailed guide to building a successful loyalty program community.

The ultimate referral program software for Shopify brands

If you run a Shopify store, consider the BON Loyalty app. We have a referral program feature and 18+ earning point options, such as social media marketing sharing.