Achieving marketing goals and growth month over month, year over year can be challenging. However, marketers often overlook one of the most effective forms of acquiring new customers: referral marketing. In fact, a Neilson Trust Study showed that referrals are the most trusted form of advertising by a large margin:
With almost half of customers choosing service-based business upon the recommendations of their friends, you’re only hurting yourself if you aren’t incorporating referral marketing into your strategy. In this blog, we’re going to break down the characteristics of a successful email referral campaign so you aren’t constantly casting your line into waters unknown, but instead catching fish that were already swimming in your pond.
Locate your promoters
Before you start sending emails asking for a referral to every customer on your list, it’s critical to zero in on those customers that are actually over the moon about your service. Think about it, if you send an email to an unsatisfied customer, it’s unlikely they’ll respond with the kind of words/actions you desired.
The best way to uncover your loyal customers is through the Net Promoter Score (NPS). To figure out the NPS of your company and for a single subscriber, all you have to do is send them an easy survey with this question: How likely is it that you would recommend our brand/product/service to a friend or colleague? (Answers are based on a 0-10 scale).
Here is a templated example below:
You can use tools like SurveyMonkey to send this type of questionnaire and also compile the results. After the person chooses 1-10, you typically ask one more question which can be done in the next screen or in a follow up email: “What's the most important reason for your score?”
Someone that chooses 0-6 on the scale is labeled as a “detractor,” people that chose 7-8 are “passives” and “promoters” are those who answered either 9 or 10. The promoters are the customers you want to send your referral email campaign to for the best results.
Examine past purchases and subscriber activity
If for whatever reason you can’t calculate your NPS, you can also look at past customer behavior to understand someone’s affinity for your company. For example, if you can see that someone has been a customer for 5+ years, they probably would be a good referral. Positive social media interaction can be a sign of promoter status, as well.
For example, we received this shout out on Twitter:
Tweets like this are referrals themselves and can be used as social proof on your website to aid the conversion process. Remember, referrals can be anything from a “like” on Facebook all the way to an actual sale. Now that you know who you should be sending these referral email campaigns to, let’s talk about ways to make these emails compelling and effective.
Personalize the copy
While this may seem obvious, it is often overlooked. Personalization is much more than using a merge tag to insert a first name. For example, if you’re asking for a rating, review or referral and are in the retail industry, it would be advantageous to mention what exactly was purchased in the email.
In the example below, the purchaser is asked to share (aka refer) their latest purchase with their friends on Facebook and receive an incentive in return.
The personalization in this referral request is spot on because it dynamically inserts what was purchased to increase relevancy and, in turn, the likelihood of action being taken.
Vary referral incentives
Your entire customer base is not motivated by the same rewards. Some may be looking for a monetary incentive while others may want access to premium features or fun swag.
For example, Scentsy offers free products for a referral:
Whereas Gilt gives a monetary incentive for the next purchase:
It’s important to remember that the incentive should correlate to the end goal of the referrer’s action. If you simply ask a customer to share a link on social to their friends, the incentive should be smaller compared to one that is given upon the completion of a sale.
Offer double-sided incentives
It’s important to offer both an incentive to the individual making the referral and the person acting on the referral. In fact, reciprocity is at the heart of social behavior, so having something in it for both parties will optimize your efforts.
Modcloth did a great job with this in the email below. Not only do they give both sides monetary incentives, but they also give a bonus incentive with the chance to win a $200 gift card. It’s a win-win-win.
Provide an email or social template
Just like you optimize your landing page to make the buyer’s journey as easy and seamless as possible, the same effort should be put into the referral process. The more hoops you make someone jump through, the lower number of referrals you’re going to get. This is where pre-populated text and templates save the day.
The example below combines a double-sided incentive with a pre-populate form making it easy for the customer to take advantage of the offer. They even let them choose if they want to send the offer via email or through Facebook, so all the customer has to do to get $20 off for themselves and their friends is enter email addresses and hit send.
Create unique referral links
When you’re asking for referrals, it’s critical to generate unique referral links to ensure your customers and potential subscribers are properly rewarded. There are different ways these unique links can be generated, but leveraging your email service provider (ESP) to accomplish this task usually does the job.
If you are sending your referral email campaign through your ESP, create a unique identifier for each recipient in order to generate individualized links. We use the EMAIL merge tag to insert the individual’s email address into the referral link.
Here is an example:
With this, you can effortlessly track the success of your referral campaign and follow through on your incentive promises.
Use single sign-on for social sharing
If the end goal of your referral email is for your audience to share a specific link on their social channels, make sure they can share with ease!
Don’t convolute the sharing process by making your user create a whole new account. Use a single sign-on solution that directly navigates them to the login page for their respective social channel.
In the example above, Harry’s has the link ready and all the end-user has to do is choose if they want to share it on Twitter or Facebook, making a seamless experience.
Go beyond the scope of email
68 percent of companies rank email as the best channel for return on investment, but you’re leaving money on the table if you aren’t reaching your audience on other digital channels. Whether video, a paid ad, social or direct marketing, referral campaigns can come in many different forms.
Dollar Shave Club did an awesome video referral campaign below and according to Entrepreneur.com, in the first 48 hours after the video debuted on YouTube, over 12,000 people signed up for the service, by the end of the week, that number over doubled to over 25,000.
While we’re obviously partial to email, the example above proves that your referral efforts should stretch beyond the inbox.
The last step
After you’ve gone through all the effort to optimize your referral email campaign, it would be a shame for that email to end up in your customer’s inbox looking broken!
We offer a free, 7 day trial, which includes unlimited email testing in the most popular inboxes so you don’t get egg on your face when you send these mission critical emails to your clients.