4 essential customer referral programme tips

With the recent launch of our ReferralHoney customer referral programme, we wanted to share with you some feedback we have received from early adopters regarding some referral best practices, along with some advice on how to fully take advantage of the opportunities ReferralHoney offers, whilst avoiding the sort of potential customer referral pitfalls that can really cause problems. So intrepid retailer, grab a cup of tea and read on for our four essential customer referral programme tips!

1. Be clear on your objectives

After installing ReferralHoney it is tempting to jump straight in and push the button on the campaign without pausing to think about your referral programme’s aims and objectives. For example, offering larger referral rewards is quite an aggressive approach that will undoubtedly drive a larger amount of referrals and hence, new customers, but which will perhaps (and this depends on your profit margins) only see you making profit on that same new customer’s 2nd or 3rd order as they hopefully migrate to becoming a regular customer with you. Likewise, offering small referral rewards will certainly attract less referral activity (and consequently less new customers) over the same period of time, but will not erode margins so drastically.

Tip to take away - know what you want to achieve, and tailor your referral rewards accordingly

2. Make sure your store is refer worthy

Expecting customers to refer their friends and family to your store is a big ask, and one that can only truly be accomplished if you are running a good ship. For example, if you were to recommend a restaurant a group of friends, and that restaurant gave them some of the worst food poisoning this side of Venus, you’d probably feel pretty bad. We’re not saying that your store might be so bad as to be actually vomit inducing, but if this example says anything it is to remind you that no matter the offer, you will only get a significant number of new customer referrals if you run a good trustworthy business, have an easy to use, reliable site and do right by your customers. Do all of these things, and the door to new customers is wide open.

Tip to take away – don’t expect many customer referrals if you consistently score badly on customer service and trust.

3. Never send a referral reward without a minimum spend requirement

Some retail customers will always want something for nothing, in fact you probably already have a mental list of the customers you hope never visit your store again. For customer referral programmes, or in fact, any form of email marketing campaign, sending discount coupons or vouchers without a minimum spend requirement can leave you wide open to this type of customer, and as experience has no doubt taught you, it’s something you could really do without.

The key then is to always create discount coupons for your campaigns, and this includes for ReferralHoney, with a minimum spend requirement. If not, expect to ship some orders for free as bargain hungry visitors match your referral rewards to a similarly priced product and checkout without spending a penny.

Tip to take away - creating referral reward coupons without a minimum spend requirement is store suicide

4. When it comes to emailing, short is indeed sweet

ReferralHoney ships with pre-written and configured emails for each part of the referral process. Now, one thing we have learned since we launched the product is that customers react a lot better to shorter, infinitely less wordy emails. Bearing this in mind, we would suggest that you familiarize yourself with the ReferralHoney sequence of emails, and decide if some chopping and changing might be required. Of course, you could run the standard emails, and then after 2 weeks swap the text for something more concise and use either Google Analytics, or the MailBeez admin based ReferralHoney reporting widget to show you direct revenue feedback.

Tip to take away - shorter emails will most likely bring greater referrals – test, test and test!

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