Referral Marketing Objectives. Referral should be viewed as a marketing channel rather than a product launch. As a channel it needs optimising and engagement. Typically the first six months are spent testing and optimising the offers and from there on it becomes about increasing promotion and segmenting the customer base to ensure that each segment is getting the optimal offer to maximise conversion. It is by continuing to work on and improve the channel that the real potential of referral can be unlocked.

 

Launch it, prove it, promote it

Launch it

Aim to get the referral channel up as quickly as possible. Initially, it is worth limiting the number of touch points and upfront work to get something live and to start learning.

Prove it

Once it has launched you’ll start to see performance and metrics that you can improve. Typically there are a couple of places in the funnel where the numbers are weaker after launch and so the team can focus on testing different variants that will improve those specific metrics.

Promote it

Once the referral funnel is looking healthy it is time to ramp up the promotion. You should be happy showing a customer an offer that has a good chance of bringing in new customers and so it is easier to convince other stakeholders to build the referral programme into different parts of the site and into email lifecycles.

 

It’s a marketing channel, not a project

Refer-a-friend often starts as a project within a business. That may well be the best way to get it up and running but it needs to be treated as a project to launch a successful marketing channel rather than a project to release a new feature on the website. This requires doing a number of things differently. First, everyone who will be involved in managing the channel needs to be involved from day one of the project. Often we see a handover from product to marketing once the project is delivered. Unless the refer-a-friend is an immediate success this risks tension and frustration between the teams and it makes it very hard to then build out the channel after launch. Marketing teams don’t feel full ownership and the product teams aren’t on hand to make any changes needed. Secondly, resource needs to be made available on an ongoing basis rather than just for the length of a finite project. It is highly unlikely that the team will get it right first time. The team may be smart but the only way to know what will work is to test the different components of the referral programme over time. Finally, it is worth recognising that doing this right will result in a channel that can boost acquisition by10% to 25%. This warrants spending marketing time and effort on it to enable it to reach its full potential. The launch is only the start. The real value comes from the marketing team working to optimise the channel over time.

 

Check list of things to consider

When embarking on setting up a referral programme there are a number of elements to consider when defining the requirements beyond the basics of the share options and reward mechanism.

  • AB Testing by Cohort – the ability to test different offers against each other whilst allowing customers to receive a consistent experience.

 

  • Segmentation – the ability to serve different offers to different customer segments. q. Easy Configuration of Offers – you’ll want to be able to change key variables (e.g. the incentives on offer, the share options, validity period of referee offer) for the different tests without needing development support.
  • Detailed Reporting – referral is a funnel (like the rest of an online business) and you need easy access to data to be able to optimise.
  • Content Management System – the ability to easily amend any text that touches a customer.
  • Easily Editable Designs – the ability for the design of the referral progamme to fit your brand and user experience and to be easily editable so that it looks like a seamless extension of your site and service.
  • Rewards Management System – to manage fulfillment of either your own coupon codes or third party vouchers. q. Customer Service Interface – the Customer Service team will need to be able to answer questions and resolve issues for the calls that come in relating to the referral programme.
  • Gaming Management – you’ll want to be able to identify customers who are attempting to claim rewards without genuinely introducing a friend. q. Mobile Experience – the user experience will need to work seamlessly across devices.
  • Assets for each Promotion Point – e.g. you may want a referral dashboard in your My Account area.