How Does Referral Marketing Work?
Referral marketing is basically turning your fans and customers into your own advocates while rewarding them for sharing what you offer to their friends. The best way to start referral marketing is by having an amazing product that people would patronize. And you would know you have it by simply going out of the way to ask your customers or by monitoring social media platforms for any brand mentions or you can do both.
To check for any mentions there are tools to use for that. It’s good to keep in mind that referral programs are no different from giving your customer incentives, and people love getting them, especially from things they actually patronize. One way to make your customers aim for getting as much referral as they can is by giving incentives that will suit the type of products you have, this could be done easier with a referral software.
Since they are your customers and not your employees, you have to make them feel good for referring their friends to your business, as well as make their friend wants to use the referral. In order to achieve that you give both of them an incentive that would really make them want to come back and try. A recommended example is a discount of 10-20% on a product or total purchase.
You can use a referral software to make implementing and tracking easier on your end as well as make it easier for your customers to promote your business. But here’s a tip in making your discount sound more and better. Make sure that your incentive or discount sounds more superb compared to how it really is.
Let’s say if your customer gets to refer a friend you’ll be giving her a $10 discount on a product worth $25. Which would look more enticing, “40% off” or “$10 off”? Definitely 40%, right?
But this would depend on the price of your product, for instance, a product you’re selling for $2,500 a $250 off would look more enticing than a 10% off. Now, remember that with referral programs there’s 2 good way to go. If your products are the type wherein your customers would be coming back soon, like makeup, lotions or fashion apparels then discounts would work great to make your customers want to refer their friends and buy from you again.
But if you’re selling products like mattresses, furniture, paintings, or the like then cash rewards would be more practical and be encouraging for your customers to refer their friends to you.
How Do Affiliate Marketing Work?
Affiliate marketing’s concept is pretty basic. The affiliate user promotes the website or product and when an affiliate converts a customer then the company rewards the affiliate. Affiliate marketing is known to be a marketing strategy that has low to zero loses because the only time you give commissions or rewards is when your affiliate users actually make a sale.
When it comes to affiliate marketing there are more parties involved compared to referral marketing. Usually, there are three parties, you’ll have the advertiser which provides the product or service. A publisher or affiliate user that will do all the publishing for the advertiser, and an affiliate network that links both the affiliate user and advertiser.
Now, these three parties are what makes affiliate marketing a success. Affiliate users, unless told not to can promote their advertisers site in many different ways. They can add a text link on their site, add in a banner, or they can go the extra and blog about their advertisers’ products, and put in a link to redirect them to the advertisers’ site.
Affiliate marketing is so much better than posting a banner and paying for it even if it didn’t bring you any customers. Another good thing about affiliate marketing is that when a customer from your affiliate wants to buy something from you again, they’ll more likely go directly to your website, which gives you a potential of gaining a long-term customer. And as long as you’re making money through an affiliate network then there’s no need to do all the dirty work of setting up some eCommerce functions or shipments because most networks will have that as their features.
Affiliate marketing is really getting more and more popular today because it’s a win-win situation for all three parties.
5 ways to get Refferal Users
Everyday people talk about their experiences with different brands, and that shows that people have no problem with talking about it. This could be good feedback or bad, so you have to make sure that you sway this conversation into your favor. Especially now that people decide on which product or brand to use depending on word of mouth, So how do you get your customers to talk about and refer your brand?
1) Ask for referrals at the right time:
- Immediately after a purchase- Customers are usually more excited about a product right after they purchase it, so make sure you take advantage of it. Try encouraging your customers to refer a friend by adding a distinct reminder right after they purchase. You can add a pop-up with all the perks of your referral program and an easy opportunity for them to share their referral on social media.
- Immediately after you get a positive customer social engagement- Trust important in eCommerce, and engaging with your customers on social media is one way to boost the image of your company and their trust. People who talk about and share your product on social media is already demonstrating advocacy. When they share or mention your brand or products, that’s a go signal to encourage them to refer their friends and get incentives in return.
- After a high rating- When your customer gives you a high rating, this shows that it’s likely that they will introduce your brand to their friends and family. To increase the persons she’ll be saying good things about you to, this is also a good time to encourage them to join your referral program.
- If you have a customer service- If you have a customer service hotline, tell your agents to encourage your customers to try the referral program after a positive call. That goes the same if you have a customer support chat system on your website. Give them a format to end a positive encounter with a message that includes information about perks of your referral program.
- Customer loyalty- It’s a good idea to start your referral program with your loyal patrons. All you have to do is let them know that such thing exists. You can start by sending the information through Email on your Email lists, and promote it on your Social Media. To make sure that they don’t forget about it you can send it as a monthly email as a reminder. You should also make sure that your referral program is easy to spot all throughout your website. You never know when you can spot a shopper in the right mood to try out your referral program.
2) Make referring as easy as it can be- prominently feature your referral program on your site. You can put a banner or a refer tab right on top of your website. Don’t expect your customers to know that you have it, also don’t expect them to go looking for it. So if you want your customers to refer your brand then make sure that it’s at least easy to spot and just a click away.
3) Turn referred to referrers – Yes, Turn the customers that were referred by their friends into people who would refer your shop. Given that they were referred, it will be more likely that they are willing to refer a friend and get some incentives from it too. Because they have once been a referred customer they know that your referral is legit, therefore once they refer people next from them will have more trust in you and your programs.
4) Encourage product reviewers to become referrers- If your eCommerce store is one of those who asks for product reviews on their website or on yours, then you can encourage them to become referrers or do a blog visit on your website. When you get a positive review and a high rating make sure that you have someone to say a thank you and include information about your referral program.
5) Get an automated referral program- get a platform that can help you in managing, tracking and scaling your referral marketing program. This way you can see the real traffic and sales you’re getting. Another good thing about automated referral marketing systems is that they can maintain a list of those people who have signed-in for your program. They can monitor your referrals and do the distributing of referrals to those who referred their friends that made an actual purchase. They can also send automated Emails to remind your Email list about your referral program.
5 ways to get Affiliate users
Qualities of an Affiliate User:
- Consistency- it’s given that in any industry there will be ups and downs, now a affiliate user can still make money even if times are bad.
- Skills- an affiliate user should at least know how to bid, know where to find offers, turn a losing campaign into one that’s winning, and has some creativity with ads or angles.
- Competitiveness- An affiliate user should have good relationships with their companies, systems, advance knowledge, and is effective operationally.
- Movers and shakers- they’re everywhere, you can see them on social media and probably on webinars too. These big earners know what they’re doing and they already have people that look up to them. Find someone who has the qualities above, I’m pretty sure most of them are skilled.
- Go all out- Start by solidifying your brand with the help of a good website. Put in a link for affiliate programs with complete information. Once your website grows popularity most of the time affiliates would go to you. Use the help of movers and shakers to connect you with other affiliate users, make them an offer that they will have a hard time refusing.
- Hiring platforms- Screen the best affiliate users from job platforms. That way you get to see reviews from their clients and some of their sample works while getting to compare them with other affiliate users.
- Word of mouth- Getting maximum exposure for your website, company and products will eventually attract affiliate users that would want to grow while your company is growing. Find a motivated affiliate user that’s goal is to help you grow while she earns more and more by it.
- Forums- The best way to meet affiliate users is through forums where they are likely to participate in. There are also different forums for different niches so if you’re into skincare then try asking if anyone’s interested to work as an affiliate user for you. At least this way you know that the affiliate you’re hiring has worked for a similar niche. The more you post and get active in forums the more you get exposure and the more chances of finding an affiliate user.
Well, There you have it, 10 ways to get affiliates and referral users. By this time you already know that referral users are different from affiliates. Referral marketing works by making people who have tried your product become advocates that get rewards.
With referral marketing, you can turn referred customers into referral users and make your referral users grow. While affiliates are people who usually work in a network and do everything they’re capable of (that you allow) to promote what you have. It’s easier to find a referral user because they are people who patronize what you have, while affiliates are those who do it for a living.
Affiliates need some skills to be more successful in their field because they usually earn through commissions, while referral users could just convince their family and friends so they can get a discount. Both give a company a win-win situation because, for both, you pay for the outcome and not just because they promoted your company.