As marketers start to plan for the coming year, there are a few key referral marketing strategies and notable social media trends to consider. How are you leveraging the power of word-of-mouth with your customers? Are you running multiple programs, like affiliate and influencer campaigns? Are you using new platforms like Tik-Tok? Are you engaging partners to expand your reach?
The best kept secret of most successful word-of-mouth marketing campaigns is to treat your programs just as you would any other high-value customer acquisition channel — invest in process, expertise, and technology while incorporating it into every aspect of your marketing strategy. While that isn't the case for marketing trends that your team is testing out, let's dive into long-term strategies that are proven to directly affect the bottomline - like, referral marketing.
In 2019, we've worked side-by-side numerous B2B companies and consumer brands of all sizes to automate the activities that previously dragged them down. As a result, their referral programs are now driving high quantities of qualified leads, new customers, and revenue in arguably the most cost-efficient manner possible — through organic word-of-mouth. Best of all, the ROI on those investments are astounding.
So, why should marketers focus on referral marketing next year? I think there are two compelling arguments in favor of investing in referrals:
Word-of-mouth, recommendations, and referrals are organic. Sure, driving and scaling them does require some marketing elbow grease. And best-in-class referral marketing software is more than $100 a month, but if you’re doing the right things — creating products customers love and making it easy for them to share your business — then driving word-of-mouth and referrals requires much less effort than almost any other marketing campaign.
Referral marketing is virtually risk-free. Because most referral marketing incentive structures only pay out rewards when a referred prospect actually becomes a paying customer, the risk and cost associated with referrals is minimal. This allows businesses to make investments in referrals with the confidence that doing so will drive a healthy ROI.
What's even more interesting for savvy marketers are the other factors outside of referral programs to consider:
- Paid advertising is increasingly expensive and ineffective
- Trade shows and events are less appealing — in part because there are more of them and it’s hard to determine if any of them will drive a high enough ROI to justify the cost
- Traditional PR is becoming an inefficient way to spread messages and products to the masses
In summary: Many of the tools in the traditional marketing toolbox are decreasing in effectiveness. And almost all of them require hefty investments with rough roads to ROI. The opposite is true for referral marketing, which makes it a very appealing alternative for driving a high volume of qualified leads and eye-opening ROI numbers.
Referral Marketing Strategies For Growth
So whether 2020 is your first foray into referral marketing or you’re taking the big leap from manual processes to automation to scale your current referral programs, we’re here to help!
Here are 3 strategies to start thinking about as you set your marketing plan for next year:
1. Create An Integrated Experience
The best referral marketing programs share a common thread: Referrals are embedded into every aspect of the user experience. Referral calls to action are included in newsletters and blogs. Employee email signatures feature referral messaging. And the referral program is fully integrated with other critical systems (customer-relationship management, marketing automation, eCommerce technology, point-of-sale systems, optimization tools, etc.).
For referrals to consistently deliver bottom-line results, they must be woven into of how your team thinks and operates. Without consistent focus on how referral marketing can be applied to other channels and campaigns, you’re largely at the mercy of chance. When your team has any discussion about marketing campaigns, make sure word-of-mouth is part of it.
2. Showcase Your Referral Marketing Program
If your referral program isn’t public facing or it’s difficult to use and share with the click of a button, then you’ll severely limit your performance. The most successful brands feature their referral programs on their website, in mobile apps, and across highest-performing marketing channels — and they ensure the referral experience is painless and seamless.
Your referral marketing program should get some real estate on a homepage or landing page. Adding a link in a header, sidebar or even smack-dab in the middle of your page will lead customers to take action and sign-up.
3. Keep a Pulse on Performance
Once you get a referral marketing program up and running, it’s easy to fall into the trap of assuming the engine will run itself. That’s a mistake. Like all strategic marketing initiatives, referral marketing programs thrive in an environment of perpetual optimization.
Your team should be constantly measuring and evaluating referral conversion metrics and fine-tuning the strategy to optimize results.
Best of all, when you’re able to drive referrals and word-of-mouth at scale, it creates this cyclical flywheel effect that compounds results. As you gain customers through referrals, you’ll also generate more customers referring your business. Over time, this will make your sales and marketing efforts more predictable, efficient, effective, and profitable.