Referral Customer Adalah

How to build a referral program

So how do you create your own successful referral program? Here are six simple steps to get started:

Referral program examples

Check out these real-world referral programs for some inspiration:

MeUndies has a referral program in addition to its affiliate and ambassador options. The program is available to customers who have made a MeUndies purchase before. It’s straightforward, rewarding $25 for every referred new customer when they purchase at least $12.

Pop culture subscription box company Loot Crate also has a refer-a-friend program. Loot Crate customers receive a referral link they can share with their networks. The corresponding customer receives a reward when someone makes a purchase using the referral link.

Outdoor apparel brand Outdoor Voices has a referral program. The program is points-based, rewarding shoppers for referrals, writing reviews, attending store events, and engaging on social media. Rewards include everything from discounts to exclusive access to products and promotions.

Tentree is a sustainable apparel brand with its own refer-a-friend option. The referral rewards both the referring and the referred customer—they each receive a 20% discount on their first or next Tentree purchase.

Rothy’s is a Shopify merchant that sells shoes and bags online and in its retail stores. Its referral program is straightforward with a minimum purchase requirement.

Referred customers get $20 off a purchase of $50 or more, and referrers receive the same discount when someone makes a purchase using their referral link.

707 Street is a retailer that offers a unique variety of trendy apparel and accessories. The brand has gained a loyal following among fashion and pop culture enthusiasts for its commitment to quality and exclusive collections of highly sought-after styles.

The 707 Street Loyalty Program is a points-based system that rewards members for referrals, signing up for the email list, making a purchase, or leaving a review, among other actions.

Junglück is a German sustainable skincare brand, offering natural products from facial cosmetics to shampoo and hand soap, with a referral program.

Referring customers get a €10 “gift card.” When someone spends that gift card, the referring customer earns their own €10 discount voucher. Junglück uses the Yotpo integration for Shopify to manage its referral rewards.

Swan is another Shopify merchant with a referral program. The household appliance brand also uses Yotpo to manage its referral program.

The program is straightforward and similar to Rothy’s referrals—just with different amounts. Shoppers can refer a friend, each of whom receive a £10 discount on their next purchase of £30 or more.

Undergarment brand Negative Underwear uses the same structure as Rothy’s and Swan for its referral program.

Referrals are worth a $20 discount to both the referred and the referrer, with a minimum purchase amount of $75. Currently, the brand uses Shopify Plus to manage all of its commerce channels in a central command center.

Hockey retailer BAUER is another multi-channel Shopify merchant. The BAUER MVP Loyalty Program is a tiered points-based customer loyalty program that rewards members for referrals and other actions.

Members can redeem points for discounts as well as be automatically entered for sweepstakes and giveaways. Additional benefits include free returns, early access to products and promotions, free shipping on qualifying orders, and more.

Invite previous customers to join the program

Loyal customers make the best referrers because they are already familiar with your brand and its reputation. Invite them to join your referral program using email marketing.

Start by sending a broadcast to announce your new program and any incentives. Most referral marketing tools have an email feature to send a customer’s unique referral code or link without participating in a signup process.

A best practice is to continue promoting your referral program by mentioning it in your purchase confirmation emails—when customer excitement is fresh. Consider using the footer of the email to invite new customers to join your referral program.

Determine the incentives

Incentivizing customers to make a referral can be an effective tactic to get more people using your program. Make a plan to determine which customers receive rewards and clearly state the details on your website.

Some companies give both the referrer and the new customer an incentive for joining. This is a win-win: New customers are incentivized to purchase through a referral link. When they do, the person who referred them is also rewarded.

Dollar credits are among the most popular referral rewards. Percentage discounts are also commonly offered as rewards. Other reward options include free products, free month subscriptions, and points to redeem on future purchases.

Regardless of which incentive you chose, a solid understanding of your customer lifetime value (CLV) is key. You want the cost of acquiring each referred customer (i.e., the cost of the incentive) to be less than the total revenue brought in by the customer.

Understand your customers

What does your target customer value? Why do they purchase your product over a competitor’s? Which incentives drive the most referrals?

Knowing your ideal customers and what influences their behaviors can help you educate those joining your referral program—and give them the insights necessary to effectively connect with their networks.

You can collect this information by leveraging ecommerce analytics tools such as Shopify’s analytics and reporting and others available through the Shopify App Store.

How does a referral program work?

A referral program works by inviting your current customers to become brand ambassadors. When they join your referral marketing program, they receive a unique code or link to share with their personal network.

There are a few components to every referral program:

Your referral program software tracks the activity of a customer’s code or link. If someone uses the shared code, for example, the referrer earns a reward. Most platforms will do this automatically, so you don’t have to worry about keeping up with and applying discounts for referrals.

Incentivized referrals

The most popular type of referral is incentivized, meaning a customer has a reason to refer your products to their personal network. In return for the referral, the existing customer may receive a discount on their next purchase, a complimentary product or service, or a cash incentive.

Lifestyle brand Erin Condren offers a double-sided referral program: giving a $10 coupon code for referred customers to use on their first purchase, and a $10 equivalent in 1,000 EC Insider points to the person making the referral.

Direct referrals are when your existing customer base actively refers your company to people looking for a product or service you provide. It’s the most traditional form of referral.

There’s not necessarily an incentive for the referrer to act; typically they are just genuinely happy with the product and are willing to share it with others.

Reputation-based referrals are when you have built a brand with such a strong reputation that people are confident in mentioning you to someone looking for the products or services you offer—even if they haven’t bought from you themselves.

While it’s a good target to aim for, it’s not necessarily easy to get these types of referrals. They happen as an indirect result of having great products and a strong brand reputation.

Types of referral programs

There are multiple types of referral programs, including:

Incentivized referrals

The most popular type of referral is incentivized, meaning a customer has a reason to refer your products to their personal network. In return for the referral, the existing customer may receive a discount on their next purchase, a complimentary product or service, or a cash incentive.

Lifestyle brand Erin Condren offers a double-sided referral program: giving a $10 coupon code for referred customers to use on their first purchase, and a $10 equivalent in 1,000 EC Insider points to the person making the referral.

Direct referrals are when your existing customer base actively refers your company to people looking for a product or service you provide. It’s the most traditional form of referral.

There’s not necessarily an incentive for the referrer to act; typically they are just genuinely happy with the product and are willing to share it with others.

Reputation-based referrals are when you have built a brand with such a strong reputation that people are confident in mentioning you to someone looking for the products or services you offer—even if they haven’t bought from you themselves.

While it’s a good target to aim for, it’s not necessarily easy to get these types of referrals. They happen as an indirect result of having great products and a strong brand reputation.

Make it easy for people to refer you

In addition to designing incentives, make sure your referral process is seamless and engaging. There are a couple of ways you can do this.

First, make it easy to refer friends and family with templates customized to your brand voice. Templates could be for emails, social media posts, or direct messages—simply formatted and supported by software allowing customer referrals to be sent with a click of a button. Include key information such as brand name, type of reward (with reward value), and discount code or link.

You can also collect online reviews that can help improve your overall reputation and grow your community of brand advocates. Ask happy customers to share their experiences on Trustpilot, Yelp, or other credible review sites that your target customers are likely to visit before purchasing.