20 Referral Marketing Ideas

Adam Steele
Feb 20, 2023
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If you’re looking for new and innovative ways to market your business (or revamp an existing program), look no further than referral marketing.

By harnessing the power of word-of-mouth marketing, you can reach new audiences and grow your business like never before.

To help you get the ball rolling, here, we’ve compiled a list of 20 referral marketing ideas.

20 Referral Marketing Ideas

Ready to take that budding (or existing) referral marketing program of yours to the next level?

Let’s do this.

1. Kickstart a Community Referral Program

If you’re looking to incentivize referrals for your business, why not consider a community referral program? By donating to a worthy cause, you can show your appreciation for your customers’ referrals, boost your bottom line, and make a difference all at once.

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Here are a few ideas for how to make this work:

  1. Choose a charity that aligns with your company’s values. This will make it easy for employees and customers to get behind the initiative.
  2. Promote the initiative through social media and other marketing channels.
  3. Set up an easy way for people to donate. Many companies use online donation platforms like JustGive or Network For Good.
  4. Keep track of the donations and let everyone know how much has been raised for the chosen charity.

Not only does a touch of altruism go a long way, but, in the eyes of potential customers, it also casts your business in a favorable light.

2. Offer Discounts and Store Credit

Referral rewards like discounts and store credit aren’t anything out of the ordinary, but they sure are effective.

To drive referrals from their existing customers, WordPress has implemented a customer referral campaign that offers $25 of store credit as the referral incentive. By taking this approach, WordPress encourages customers to do the hard work for them and promote their business without taking on the typical high cost that is associated with customer acquisition.

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You can take this approach too. By simply offering a discount or credit as a referral reward, you can integrate a low-cost customer acquisition strategy into your referral campaign while also boosting the amount of paying customers you attract to your business.

3. Exchange a Free Gift for Referrals

By offering a free gift for referrals, you are encouraging current customers to spread the word about your business and bringing new customers into the fold. To cement your referral program in success, offer gifts that are valuable and relevant to your target audience.

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Take Flaviar’s strategy as a good example of this approach. Flaviar, a fine spirits and whiskey manufacturer, gives both existing and referred customers their choice of a tasting box or bottle when they refer new customers or sign up for the company’s monthly product subscription.

This acts to both encourage new business while also giving referred customers a chance to try their product.

Genius.

4. Use Catchy Subject Lines in Your Referral Emails

No referral program is successful without an effective email marketing strategy in place. The first touchpoint, the email subject line, is integral to achieving the open rate your referral program deserves.

How can you curate subject lines that attract high open rates?

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Here are four quick tips:

  1. Keep it short and sweet. A subject line that is too long will get cut short in the recipient’s inbox, so keep it brief and to the point.
  2. Be specific. Vague subject lines are often ignored. Be specific about what your email contains so that recipients know what they can expect and are more likely to open it.
  3. Use enticing language. Language that creates a sense of urgency or curiosity can encourage recipients to open your referral emails.

A perfect example of an attention-grabbing subject line? This is from the example above, Shortcut: “Refer friends, get rewards. Refer enemies, also get rewards.”

5. Craft Catchy Email Headings (and Subheadings)

An effective email marketing campaign depends on more than just a great subject line. Your heading and subheadings also play an important role in getting recipients to open and click through to your referral program landing page.

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Here are some tips for crafting catchy email headings (and subheadings) that will help you boost your open and click-through rates.

  1. Keep it short and sweet. Your heading should be short and to the point. Avoid using excessively long or complex phrases.
  2. Use powerful words. Choose words that are strong and persuasive, such as “free,” “new,” or “act now.”
  3. Create a sense of urgency. Include phrases like “limited time only” or “while supplies last” to encourage recipients to open and click through your email right away.
  4. Use numbers and lists. Readers love tangible talking points. Numbers and list items make memorable takeaways.
  5. Make it catchy. A headline that’s interesting and eye-catching will make people want to read more.

6. Make the Most of Seasonal Events

As seasonal events like Mother’s Day, 4th of July, and Christmas are largely based around showing appreciation for the loved ones in our lives, this gives your business ample opportunity throughout the year to ramp up your referral marketing efforts.

How?

Marketing material used in promotional emails, landing pages, and social media posts can all be tweaked to reflect a seasonal event.

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Here are a few ways to achieve this:

  1. Create seasonal-specific campaigns. Use hashtags, social media post updates, and create ads that target people interested in the relevant seasonal event.
  2. Offer seasonal discounts and promotions. Create special offers and incentives for customers who refer new business during seasonal events. This could be anything from a discount on their next purchase to a freebie or voucher.
  3. Use seasonal imagery. Get creative with your marketing materials and create visual messaging that fits with the theme of the season or event.

7. Incentivize With Gift Cards

Lucrative rewards are at the backbone of any successful referral program. One of the most attractive referral rewards? Gift cards. By offering both new and existing customers gift cards as a reward for referring new customers to your business, you are not only motivating advocates to help promote your business, but you are also showing your appreciation for their loyalty.

So what’s the best approach here?

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Well, you can, of course, offer in-house gift cards that allow your customers to shop for the products and services you stock. Or you could take a leaf out of Smile Direct Club’s book and offer a gift card from popular retailers, like Amazon.

Whichever you choose, just be sure to hit the right balance between providing a gift card that’s valued at an amount that will entice referrals, but not so costly that you’ll break the bank.

8. Segment Your Customer Base

Referral marketing programs can be segmented to better target customers. By segmenting your customers, you can more effectively target them with marketing material they’re most likely to engage with. This results in the efficient use of marketing resources and higher conversion rates.

There are a few different ways that you can segment your customer base. One way is to segment by geographical location. This allows you to tailor your marketing material to specific regions or even specific cities. Another way to segment your customer base is by demographics such as age, gender, income, or previous purchasing behavior. This allows you to create targeted marketing campaigns that are more likely to resonate with the target demographic.

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Once you’ve segmented your customer base, you can start creating targeted marketing materials. This could include things like custom landing pages, targeted ads on social media, or personalized email campaigns.

9. Develop a Dedicated Referral Marketing Landing Page

Another effective method to boost your referral marketing efforts is to develop a dedicated landing page that highlights the referral incentives offered by your referral program. By doing so, you can provide potential referrals with a clear and concise overview of what they can earn by joining your program.

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Following the example set by Our Place, some key elements to include on your landing page include:

  1. Concise copy that grabs the attention of the reader.
  2. A brief description of your referral program and how it works.
  3. And a CTA button positioned in a prominent location.

10. Integrate Attention-Grabbing Visuals

As with any form of marketing, successful referral programs involve developing marketing material that is eye-catching and attention-grabbing. Incorporating visuals is a great way to do this.

How?

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Like Postable has achieved, use visuals that are branding-aligned and that support your messaging. Avoid using generic stock photos. Instead, use original photos, GIFs, or graphics that will help give your referral marketing materials a unique look.

11. Try Out Product and Service Upgrades

By providing product and service upgrades to customers who refer new business, companies can create a circle of growth second to none other.

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Take Dropbox’s strategy as a great example of how product or service upgrades can be a potent approach to successful referral marketing. As reported by Viral Loops, Dropbox grew a whopping 3900% in just 15 months simply by employing a service upgrade that rewarded referring customers and referred customers with no less than 16GBs of extra storage.

Sacrificing server space for a huge uptick in users isn’t a bad exchange if you ask us.

12. Reward Your Customers for Their Past Patronage

It’s important to keep your loyal customers happy. Research shows it costs five times as much to attract a new customer as it does to retain existing customers. That’s why rewarding your most loyal customers is such an integral feature of any good customer referral program. This approach not only incentivizes referrals from customers that are actively participating in your referral program, but it also benefits your business’ bottom line.

So what’s the best way to reward loyal customers?

In exchange for referrals, you can reward your loyal customers for their past patronage by offering something extraordinary. An exclusive discount, an invitation to special events, or early access to product or feature launches are all great places to start.

Oh, and to really satisfy your loyal customers’ tastes, be sure to couple attractive referral rewards with the right messaging.

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Take this example from Tictail here. By simply using the phrasing “We wanted our most valued shoppers to be the first to know…” they’ve created a sense of exclusiveness and gratitude.

Whatever route you decide to take, make sure you let your customers know you appreciate their loyalty. Remember, a simple “thank you” goes a long way.

13. Consider Tiered Incentives

Another effective method of rewarding customers is to offer tiered referral rewards, where customers receive increasing rewards for each friend they refer.

For example, you could offer a $5 discount for the first referral, a $20 discount for the second referral, and a $30 discount for the third referral. This will encourage customers to continue referring their friends, as they will receive progressively greater discounts.

Another way to structure tiered referral rewards is to offer a fixed reward for each referral, but increase rewards for referrals made by VIP customers. For instance, you could offer a $5 reward for referrals made by regular customers and a $10 reward for referrals made by VIP customers. This incentivizes VIP customers to continue referring their friends, while also encouraging regular customers to strive to become VIPs.

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Or you could take Soylent’s approach to tiered incentives. Under their refer-a-friend program, customers receive a predetermined amount of points per action they perform.

For instance, the referral of a single customer earns an advocate 10,000 points. This grants the referrer access to a few different rewards that they can choose from. For instance, they may wish to spend the points on a $10 off voucher, grab two free blender bottles, or they could refer two more customers and receive a free Soylent hoodie.

Whichever strategy you choose, tiered customer referral programs are a great way to not only incentivize referrals but also a range of other actions that will promote your business.

14. Kick-Start a Referral Partnership (Affiliate Program)

Referral marketing presents a fantastic opportunity to partner with another business or prominent individuals within a space. As an example of how effective affiliate marketing can be, for US-based eCommerce stores, 16% of revenue is generated by affiliate marketing—in 2022, that equates to $40B of revenue (out of $252.1B total sales).

So how can you incorporate an affiliate program into your approach to referral marketing?

Well, as Unbounce has done here, you can reward affiliates with a commission for each referral they send your way. Unbounce offers affiliates 20% recurring revenue for every new customer they refer to the company’s platform.

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How can you replicate Unbounce’s example?

There are a few things to keep in mind:

  1. Define your goals. What do you hope to achieve with your affiliate program? More sales, more leads, or something else?
  2. Choose the right partners. Accept affiliate applicants that complement yours and who have a similar target audience.
  3. Promote your program. Get the word out about your new affiliate program through your website, social media, email marketing, and other channels.

15. Streamline the Referral Process

We get it. It takes a lot of time and effort to create a successful referral program. But once you have one in place, it’s super important not to rest on your laurels. You should always strive to make participating in the program as easy as possible.

Take Outdoor Voices here as an example of a streamlined referral process.

In three sentences, they’ve walked the new customer through what referral rewards they can expect from their referral program. The rest is pretty self-explanatory—all the recipient needs to do is click the CTA button and begin sharing.

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To replicate Outdoor Voices process, here are a few tips:

  1. Provide easy-to-follow instructions on how customers can refer their friends and family.
  2. Offer incentives that make participating in your referral program a no-brainer.
  3. Make it easy for referrers to share your program with their networks, including a CTA button and a referral link.
  4. Once the CTA button is clicked, create a dedicated landing page that makes it easy for potential participants to find all the information they need to participate in one place.
  5. Use an automated system to track referrals and send out rewards. This will save you a lot of time and hassle in managing the program.

16. Roll-Out Subscription-Based Rewards

Another popular referral marketing strategy involves offering subscription-based referral rewards. Under this type of program, customers who refer new customers to your brand receive a free subscription period.

What does this look like in practice?

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For SaaS companies, like Busuu, you could simply offer new and existing customers access to your service as a free gift. For businesses that operate outside of the SaaS space, you could offer both your advocates and referred customers a free subscription to a popular third-party service, like Spotify or Netflix.

This is an attractive incentive for customers, as it gives them the chance to try out your product free of charge or saves them money on popular subscription-based services. While it also benefits you by showcasing your service and attracting new customers.

17. Raise Urgency With Limited-Time Incentives

In order to raise urgency and encourage more referrals, leveraging limited-time referral rewards is never a bad play. As Postmates have executed in the below campaign, this could be in the form of a discount or an exclusive offer that they’ve made available to their email subscribers as a timed-time offer.

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$100 worth of free-delivery credit, not bad at all.

You could also take the approach of offering higher rewards for referrals made within a certain time period. For example, you could offer a $20 store credit for every referral made over a 48-hour period, instead of the usual $10.

Whichever approach you decide to take, by leveraging limited-time offers, you’ll create a sense of urgency and encourage customers to refer your business to their friends and family members sooner rather than later.

18. Run a Referral Contest or Giveaway

Running a referral contest or giveaway is a great way to jump-start your referral marketing program. By offering participants a chance to win in exchange for successful referrals, you can encourage customers to spread the word about your business’ products and services.

Just like Scott’s Cheap Flights’ recently held referral marketing campaign has achieved. In exchange for referrals, the company offers 10 lucky customers the chance to win a free year of premium subscription to the company’s platform, as well as $200 cash.

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When rolling out your own referral contest or giveaway, there are a few things to keep in mind:

  1. Make sure the rewards are enticing enough to motivate people to take action.
  2. Clearly define the rules and eligibility requirements so there’s no confusion.
  3. Promote the contest or giveaway through your marketing channels (email, social media, etc.) to reach as many people as possible.

With a little planning and effort, a referral contest can be a great way to generate buzz and drive growth for your business.

19. Target Prospects With PPC Ads

PPC ads—displayed on either search engines or social media platforms—allow you to target specific keywords and demographics to reach your target audience effectively.

Ensuring your marketing efforts are focused on those who are most likely to convert into customers.

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How do you go about this?

Here are a quick few tips to get you started:

  1. Research your target market. In order to create relevant and effective ads, you need to have a solid understanding of who your target market is. Consider what demographics they fall into, what interests them, and what needs or pain points they may have that your product or service can address.
  2. Research keywords. Keywords are the foundation of any good PPC ad campaign. Make sure you spend time researching which keywords are most relevant to your business and products/services.
  3. Create compelling ad copy. Your ad copy needs to be attention-grabbing and persuasive in order to get people to click through to your website. Without this, your ads are, well, pretty useless.

If you need help in this area of referral marketing, see our full range of PPC ad services here.

20. Optimize Your Referral Content

When it comes to referral marketing, the quality of your referral content is key to driving conversions. Copywriting and SEO are essential components of an effective referral marketing strategy. By optimizing your referral content for search engines, you can ensure that potential customers will see your brand when they’re searching for products or services like yours.

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Including strong calls to action (CTAs) in your referral content is also important. Your CTAs should be clear and concise, and they should tell customers exactly what you want them to do. For example, phrases like “get your unique referral link” or “refer now” are simple yet effective.

Optimization is a constant and ongoing task. To make it easy on yourself, check out our SEO copywriting, blog writing, and content marketing services by clicking on one of the corresponding links.

Looking for more? Check out the collection of hundreds of actionable marketing ideas.

Summary

Referral marketing is a great way to grow your business. By offering incentives to customers for referring new customers, you can quickly expand your customer base, increase sales, and reward new and existing customers with attractive referral incentives.

To ensure your referral program continues to receive the attention and success it deserves, reach out to us here at Loganix

See a full breakdown of our services here.

Written by Adam Steele on February 20, 2023

COO and Product Director at Loganix. Recovering SEO, now focused on the understanding how Loganix can make the work-lives of SEO and agency folks more enjoyable, and profitable. Writing from beautiful Vancouver, British Columbia.