How To Use Referral Marketing To Boost Your Brand’s Engagement

Referral programs are a great way for your business to make some extra cash from your existing customers and their friends or family. When your customers love what you offer, they’ll happily tell others about your brand without you having to set aside money for ads or marketing materials for those new leads.

You might need to offer some perks or set up a program to give customers benefits when they spread the word about your brand, but starting work on getting more referrals is a smart move to grow your current customer base and expand your brand.

Understanding Referral Marketing

With referral marketing, you have a goal of using connections you’ve already made, such as existing leads or customers, talk about your company and get them to refer friends, family members, and others to your business. Approximately 92% of consumers trust recommendations made by friends or family members. Getting your current customer base to send you referrals can be an exciting way to grow your audience and revenue.

Why Referral Marketing Matters

Referral marketing is important because it builds trust, brand credibility, and social proof. It also prepares your business to grow. Here are some of the reasons you should consider using referral marketing as a part of your brand’s marketing strategy:

Get Going: Little to No Cost To Get Started

Consider adding referrals to your marketing strategy for one significant reason: They come at little to no cost. Word-of-mouth marketing is totally free. All people have to do is talk about your business to get new referrals to head your way.

Create a Higher Customer Lifetime Value (CLV)

Your business can increase the total value of a customer over time through referrals. A customer, on their own, may spend $1,000 over their lifetime, for example, but with referrals, their value could be multiplied exponentially.

Get a Higher Chance of Conversions

Referrals that come to your brand will mostly be warm leads. Someone they know and trust, whether it’s an influencer, family member, or other party, has given you a positive review and sent them your way.

Establish Trust With Consumers

Getting new clients or customers through referrals helps you build trust before the first interaction. They know someone who has had a great experience, so they expect the same and come to the first interaction with a positive outlook.

Increase Your Client Base

Referrals help grow your user base. With referrals, you build on the customers you already have and expand into their social circles. As you grow your user base, the potential for a greater number of referrals also grows.

Reduce Your Spending With Referral Programs

The cost of getting a customer can be high, and the last thing you want to do is drain your marketing budget on leads that don’t work out. That’s why using referral programs can be so beneficial to your brand. Rather than using up your budget for new leads, you can set aside some of that spending towards incentives and referral programs that cost less and have a higher return on investment (ROI). With a good referral program and a focus on customer retention, you will see your customer base grow.

Encourage Loyalty From Customers

When a person’s friends or family use a specific brand, it encourages loyalty. Even if there is one bad experience, they may stick with you. You’ll have more opportunities to correct past mistakes and have the client base to support you as you try new offerings.

Understanding How Referral Marketing Works

Referral marketing works by identifying loyal customers and using them to send new customers to you. These are some steps you’ll need to take:

Identify Brand Advocates

Identify those who are most likely to tell others about your products and services. Advocates tend to be repeat buyers and happy customers.

Incentivize Referrals

Customers like to get rewarded for their efforts. If you can, consider incentivized referral programs with free products or other perks.

Provide Easy Referral Tools to Your Customer Base

To make referring others to your business easier, consider adding referral links to your site or email marketing materials. You can also use referral codes or social media sharing options. Essentially, make sharing your brand’s content simple, and you’ll improve the likelihood of getting referrals.

Track Sales and Customer Interactions, and Reward Them

After a new customer signs up using a referral code or link, the referrer should receive their reward.

Build Trust With Your Key Customers

From this point on, you need to focus on trust. Potential and new customers are more likely to try your products and services because they’ve been referred by someone they trust. You need to continue building on that trust by providing high-quality customer service and support.

Scale Up Your Referral Programs…and Optimize Them

Remember to monitor your business’s referral program. By doing so, you can build on past successes and work on optimizing the program to get the greatest number of conversions.

The 5 Main Kinds of Referral Marketing

You can use several kinds of referral marketing to boost your customer acquisition rate. Consider these as a part of your business’s marketing program:

1. Direct Referral Marketing

Direct referral marketing requires you to ask your customers to refer new clients or customers to you. Using a brand ambassador to speak with customers and ask for referrals is an example of this marketing approach.

2. Email Marketing

Email referral marketing lets you send personalized emails about your current referral programs. Sending these promotional emails to your current customers encourages them to sign up and take part.

3. Incentivized Marketing

With incentivized referral marketing, you offer an incentive to get your customers to refer others to your business. For example, you may offer a discount for a referral to your business. It can help to have incentives that grow with the number of referrals. That way, customers feel they should refer more than one person to reap all the benefits of the program.

4. Social Marketing

Social referral marketing is done through social media. You’ll have brand advocates or influencers who support your business. They can share more information about your brand and influence others to use your products or services, too.

5. Review Marketing

Review referral marketing is as straightforward as getting a referral after they’ve read a review online. Your Google My Business page may refer new customers to you organically.

7 Key Referral Marketing Strategies You Can Try

Getting referrals is an excellent way to save money on marketing and lead capture. In fact, with the right referrals coming in, you have almost no financial investment involved but still get warm leads that are easier to turn into conversions.

Your business can try these referral marketing strategies for customer acquisition and to boost your revenue:

Create Shareable Content

First, think about building up a social media account of highly shareable content. For example, you might share a set of slides walking customers through using your product, or you might create a funny meme that they’ll share with others. Be sure to make the content easy to share by adding appropriate buttons or links to your website, email campaigns, and blogs.

Provide Excellent Customer Service

To get more customers coming your way, you need to show them why you’re the best in the business. Give customers a way to get in touch through texting, chatting, or calling your business directly. Then, ensure your customer service team is ready to handle any questions that come their way. You can use Podium’s AI Employee to respond to inquiries immediately, even after hours, to be sure you don’t miss any leads or customer service-related concerns.

Go Beyond Customer Expectations

The best way to thrive as a business is to go above and beyond for your customers. The happier customers are with how they’re treated, the quality of your products, and your brand’s reputation, the more likely they’ll spread the word about what you do.

Create a Community Around Your Brand

Building a community around your brand is a good way to boost the likelihood of a strong referral program. Whether you focus on community by answering customers in the comment sections of your social media pages or you have a forum on your website where they can troubleshoot and ask questions, having a community builds familiarity and trust. And, as an added benefit, you’ll get more insight into how your most loyal customers think and feel about your brand since they’ll share their thoughts within that community.

Offer Strategic Referral Incentives

A strategic referral incentive setup is a good way to get new referrals regularly. You can have straightforward programs, such as those offering a discount per referral, or you might offer a tiered program that gives greater benefits the more referrals someone sends your way.

Use Email Marketing To Promote Referrals

Don’t forget to promote referral programs and incentives in your email marketing campaigns. Tell your audience you want referrals; this can be enough to get them to send others your way! In your emails, include referral links. When your customers share the email or link, the new referral will be attributed to them and be easier to track on your end.

Make It Easy For People To Refer

A key tip for getting more referrals is to make it easy for your current customer base to refer others to you. When they only have a referral number but no live link, it can get tricky to refer others to you. And, if they can’t find a way to share the content how they want to, such as on their own social media page or through email, they may abandon the idea altogether. Always ensure your content is sharable.

Use Referral Links

Use referral links to get others to share referrals with your brand. Referral links are unique to each customer, which is good for two reasons. First, the referral link tracks the referrals and “awards” them to the referrer. On your backend, you will know exactly who sent the referral your way and can pull up associated data to see how many referrals that particular person has sent.

The second reason referral links are so good is that they’re easy to share. Rather than trying to remember a six-letter code, all your customer has to do is copy and share the link. There’s no risk that the referred party will forget to type in a code or add the referee’s name to their shopping cart at checkout, ensuring the referral is tracked appropriately.

Boost Your Reputation and Get More Referrals With Podium

With the right approach to taking care of your customers and a strong referral system in place, you can expand your client base and see an increase in customer lifetime value (CLV) across the board.

A major part of getting more referrals is being customer-centric. As a customer-centric business, you should focus on providing excellent customer service and showing your customers that you care about your relationship.

With Podium’s AI Employee, you can take your customer service up a notch. Respond to inquiries quickly with the AI Employee who sounds as human as you are. And, get up to 30% more sales with your new AI Employee who can chat, sell, schedule, and communicate around the clock.

Ready to see how Podium can help your business build a positive reputation and boost your referral system? Watch a demo.