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Sales Strategy
Guide to Getting And Sending Referrals
Christina Miranda
April 13, 2024
|
7 min. read
Christina Miranda
LAST UPDATED
June 7, 2024
READING TIME
7 min.
We’ve got two scenarios here ⬇️
You found something amazing, and just can’t stop talking about it? Get rewarded for it!
You’ve got the best product ever, and want to reach more leads? Get your clients to brag about you!
What is referral marketing?
First things, first. What exactly is referral marketing and why is it so beneficial for both companies and clients?
Referral marketing is a marketing strategy that involves the active participation of your clients.
This kind of marketing strategy is mutually beneficial as both clients and companies help each other grow and increase their client base.
The client commits to sending out referral links (typically exclusive) to find new customers for the company, and in turn, the company offers the client incentives in the shape of rewards, discounts, special offers, etc.,
This kind of marketing is growing exponentially. We’ve all been browsing social media and spotted our favorite influencers offering a special discount when using their code for the product.
For it to work the business has to build strong relationships with its clients. You want your clients to reflect the nature of your business. So make sure you follow through with your promises, have a solid product or service to offer, and have a dedicated team to solve your partner's doubts.
Why choose a referral marketing strategy? Check the stats!
60% of small businesses’ revenue comes from referral programs 82% of new clients for small businesses come from referrals
Referral program vs affiliate program?
Referral and affiliate programs essentially work under the same principle: use an exclusive link or code to build the business’ customer base.
But there are some subtle differences. We’ve summarised them in the following table ⬇️
Area
Referral
Affiliate
Relationship
Referrals go to acquaintances. The referrer receives a reward if it leads to a sale.
Affiliates promote the business and earn a commission for each sale through the referral link.
Participants
Existing customers or users referring new customers to the business.
Wide range of participants (bloggers, influencers, content creators, website owners, etc.)
Incentives
Discounts, credits, free products, etc.
Commissions based on sales through the affiliate links
Through unique referral links or codes. The business manages the program internally.
Sophisticated tracking system. Affiliates also track their progress
Let’s get a bit more specific, though.
Nature of the partnership relationship
By nature of the partnership relationship, we mean the relationship that the referrer has with the people they refer the business to and to the program.
Referrers can either promote the business to their own audience base or reach out specifically to their acquaintances.
The rewards they receive will also vary.
Referral Program
In a referral program, existing customers or users refer friends, family, or acquaintances to the business with an exclusive link or code. The referrer typically receives a reward or incentive if the new client uses the referral link or code to make a purchase.
Affiliate Program
In an affiliate program, individuals or entities (affiliates) sign up to promote a business's products or services through unique affiliate links. Affiliates earn a commission for each sale or conversion generated through their referral links. Affiliates tend to have a wider audience base and are required to reach more people.
Participants
The company generally opens up the program, and customers then sign in and are vetted by the company. In some cases, the company may choose to reach out to specific customers and prompt them to promote the business.
Referral Program
Referral programs usually involve existing customers or users referring new customers or users to the business.
Affiliate Program
Affiliate programs can involve a wide range of participants, including bloggers, influencers, content creators, website owners, or other businesses. Basically, eligible members for an affiliate program are those clients who already have a decent audience base.
The affiliate program can also offer site recommendations and co-branding, thus expanding the affiliates’ audience base even further.
Incentives
By incentives, we mean the reward that the referrer will receive every time a new client purchases from the starting company using the referral link or code.
Incentives won’t always be the same for all referrals. These can vary depending on the client reach the referrer may have and the amount and quality that they bring into the business.
The company opening up the referral program should be clear on how the rewards and incentives before the partnership is closed.
Referral Program
Referrers in a referral program typically receive rewards such as discounts, credits, free products, or other incentives for successful referrals.
Affiliate Program
Affiliates in an affiliate program earn commissions based on the sales or conversions they generate through their referral links. The commission structure can vary, and affiliates may earn a percentage of the sale amount or a fixed fee per conversion.
Relationship with the Business
The relationship of the referrer or affiliate partner with the business involves a close connection between both parties. The referral program's relationship is typically with existing customers who refer others, while the affiliate program involves external partners who promote the business's offerings to their audiences.
Referral Program
Referral programs often focus on leveraging the existing customer base to acquire new customers or users. The relationship is primarily between the business and its customers.
Affiliate Program
Affiliate programs establish a formal partnership between the business and external affiliates who promote its products or services. Affiliates operate independently and may promote multiple businesses simultaneously.
Tracking and Management
Tracking referral and affiliate activity is imperative for the company to see how their partners are performing.
Tracking can be through a more sophisticated dashboard that can be shared with the partner, or can be only measured internally in the company.
Management of the referral or affiliate programs typically refers to the building of the program, recruitment, onboarding, and distribution of media kits to guide the partners. Affiliate management tends to be much more in-depth and hands-on.
While both referral and affiliate programs involve tracking and managing referrals or promotions, affiliate programs typically require more extensive management due to the involvement of external partners (affiliates) who operate independently of the business.
Referral Program: Referral programs typically involve tracking referrals initiated by existing customers through unique referral links or codes. The business manages the program internally and tracks referral activity.
Affiliate Program: Affiliate programs require sophisticated tracking systems to attribute sales or conversions to specific affiliates. Businesses often use specialized affiliate marketing platforms or networks to manage affiliate relationships, track performance, and process payments.
What are the benefits?
As we have already mentioned referral and affiliate programs are mutually beneficial marketing strategies.
These types of programs open up many opportunities for both parties, the largest one being that through these programs businesses and clients help each other to grow in their own areas, by being exposed in front of completely new audiences.
Word-of-mouth has always been the best strategy out there, after all, wouldn’t you want to take advice from someone who knows the best products out there? And what better advertisement is there than a happy client?
Let’s see exactly how this partnership benefits each of the parties.
Benefits for the business
The first and most obvious benefit (which is also the main purpose) of referral and affiliate programs for businesses is achieving higher outreach.
But what else can you achieve with a well-laid-out referral program?
Increase your client base
Referral programs lean on their existing client base to reach new customers. Since referred customers are often pre-qualified and more likely to convert, referral programs can lead to a higher customer acquisition rate.
The more clients de referrer brings, the higher the reward (for everyone 😉)
Build a cost-effective marketing strategy
Compared to traditional marketing channels, referral programs can be more cost-effective, as you are not investing in pricey campaigns that may or may not get the desired results.
With referral programs, businesses are guaranteed that the partnership will bring in a larger amount of customers since their sole advertisement is an already happy client.
Achieve positive brand awareness
Referral programs can help spread positive word-of-mouth about a brand, leading to increased brand awareness and visibility.
As satisfied customers refer others to the business, it can create a domino effect, further expanding the brand's reach.
Improve your customer lifetime value
Referred customers tend to be more loyal and have a higher lifetime value compared to non-referred customers. This relies on the fact that your new customers aren’t here “just to see what happens”, they already know the benefits of your product or service, and they already know they work.
Your new clients come into the business taking the advice of someone they trust in the first place, therefore, in their eyes, you are a valuable asset.
By incentivizing referrals, businesses can increase customer retention and overall revenue.
Ensure your new clients already see you as trustworthy and credible
People are more likely to trust recommendations from friends, family, or peers than traditional advertising.
Referral programs lean on this trust factor, leading to higher credibility and a stronger connection between the brand and potential customers.
Gain data and insights into your potential client’s behavior
Referral programs provide valuable data and insights into customer behavior and preferences.
Businesses can analyze referral patterns, identify top referrers, and gain insights into what motivates customers to refer others, allowing for more targeted marketing strategies.
You’ll be able to pinpoint your biggest strengths and weaknesses, what your clients look for, and what goes unnoticed, and adjust your marketing strategies from there, or find out how you could improve the products or services that are not being advertised or purchased as much.
Benefits for the referring client
When, as clients, we spot a new referral program or are offered a paid partnership, the first benefits that come to mind are obviously rewards and discounts, and being showered with gifts.
And, yes, these benefits are awesome, since we would be looking at:
Rewards and incentives such as products or services
Savings and discounts
Exclusive Benefits such as VIP access, early product releases, or invitations to special events
But the benefits of joining a referral program with your favorite brand don’t stop there.
Higher engagement with your audience
Referring others to a business can strengthen relationships between you and your network.
By recommending a product or service you trust, clients demonstrate their confidence in the brand, which can foster deeper connections with friends or colleagues.
This can also lead to your audience sharing your content, therefore increasing your audience base.
Increased Trust and Credibility
When you refer others to a business you are essentially vouching for its quality and reliability. This builds trust and credibility not only for the brand but also for you by making the referral.
Essentially, this process will establish you as a thought leader in your industry. You found the best product, have learned about it and you are saving your audience from having to research it themselves.
Social Recognition
This occurs typically with affiliate programs. By being committed to the brand this partnership could also result in social recognition or acknowledgment for your referrals, such as being featured on the company's website or social media channels.
How to effectively publish for a referral
When you sign up to become an affiliate or referral partner, you must understand that the quality of your posts will impact the amount of people who will use your linked, but also the perception the brand will have on you and your dedication.
Therefore, your posts should be carefully crafted and show your personality and the brand’s personality at its finest.
It’s not enough with just saying “Hey, buy here, they’re cool guys”. You honestly need to believe in the product you’re pushing, in order to not look like a sell-out. That could reflect badly on you and the company in question, and could even lead you to lose your partner status.
Let’s go over a quick checklist that will help you be the best partner out there!
[ ] Do your research.
What do you like the most? What feature de you think would benefit your audience the most? How effective are the features you’re interested in?
[ ] Choose the right platform
Decide where you want to publish your referral post based on where your target audience is most active. This could be social media platforms like Facebook, Twitter, LinkedIn, or Instagram, or it could be your website, blog, or email newsletter.
[ ] Take a look at the media kit you may receive from the business
Most businesses will offer you a full toolkit that will guide you in the right direction to gain higher exposure with your content.
Check what style, visuals, and tag lines the brand offers to really understand their personality, and make good use of them.
[ ] Start writing your post
Write an engaging copy that clearly explains what the business offers, and how you feel about it.
Include personal anecdotes of how the product helped you, open a line for discussion to see how your audience could benefit or the pain points that they are facing, etc.
[ ] Don’t forget to include your referral link or code!
This may seem quite obvious, but don’t forget to make your link or code prominent in the post, this way your readers won’t just wonder off and research themselves.
Include a strong CTA to ensure that as many leads as possible use your link or code!
If you need more inspo to craft your posts, check out this video. ⬇️
Large companies that rely on referrals
Revolut
Revolut offers economic rewards every time you get a friend to join.
They have an In-app Refferal app system where you have to:
Invite someone to join
Once you receive the link, you craft your message and send the link to your Invitee/s
Have them click on your link and join to make you eligible
Once you have sent out your messages, your Invitee/s also have a series of steps to follow before you can receive your rewards.
Uber
With Uber rewards may vary depending on the city you live in.
These are the steps you should follow ⬇️
In the app you will find your invite code and will be able to track your progress and rewards.
Rewards will be sent once your invitees complete an allotted number of trips with the app.
Waalaxy
Waalaxy offers three different Ambassador programs which you can choose from:
50% commission + 1 month free trial
30% commission + 20% promo code
30% commission + 2-month free trial
Waalaxy targets influencers, salespeople, students, and anyone who wishes to promote their software.
You simply have to log in and join the Ambassadors program.
Apollo.io
Apollo offers up to a 20% commission with your customer referrals.
You simply have to generate your personal link on their page, refer the software on your chosen platform, and start earning!
You will receive commission for the first 12 months of your customer’s lifetime value.
At lemlist we’re on the verge of launching our new affiliate program. When you become a lemlist Affiliate you get the chance of receiving economic rewards, site-recommendation and co-branding.
The process is simple:
Complete the questionnaire and wait to see if you’re eligible to become a partner.
Refer lemlist to your network and use the very handy lemlist Affiliate Partner Media Kit. Remember, the more the better!
Receive your commissions within 30 days and use your exclusive link to track all of your results.
This program is created for:
Content creators focusing on B2B
Agencies handling outbound for clients
Consultants providing outbound tools implementation & training
Technology reviewers
Anyone interested and capable of joining the program!
Software to help you set up referrals
ReferralCandy
ReferralCandy enables companies to create and manage referral programs easily, allowing customers to refer their friends and contacts to the business in exchange for rewards or incentives.
ReferralCandy automates the referral process, tracks referrals and rewards, and provides analytics to measure the performance of referral campaigns.
Pricing
ReferralCandy offers three paid plans in which they include a commission fee, which will vary depending on the tier your ultimately choose. Pricing starts at $59 and increases from there.
Get Ambassador
GetAmbassador enables businesses to design, launch, and manage referral programs to drive customer acquisition and revenue growth.
It provides tools for creating customizable referral campaigns, tracking referrals and rewards, and analyzing campaign performance.
Get Ambassador offers three paid plans and starts at $300 per month, and goes on to personalized pricing.
Key Takeaways
To sum up, making use of referrals (whether you are a business or a client) can only benefit you.
For businesses
✅ Higher revenue
✅ More exposure
✅ Cost-effective marketing strategy
For clients
✅ Rewards and discounts
✅ Become a thought leader
✅ Engage with your audience
If this article has given you the referral itch, go ahead and join the lemlist Affiliate Program and start benefiting!
Christina Miranda
Content creator and translator @ lempire
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