Let’s Talk Referral Marketing with Al Lalani

by Sean Ogino |

Let’s Talk Referral Marketing with Al Lalani


In this episode of Let’s Talk, our Chief Strategist Al Lalani speaks with us about best practices in referral marketing. Did you know that 7 out of 10 Americans seek opinions from their peers prior to making a purchase? Or that 49% of people say friends and family are their top source for brand awareness? The fact remains, a strong referral marketing presence can be a major difference maker when implementing your solution.

“The referred customer is among the most valuable,” states Al Lalani, Chief Strategist of Annex Cloud. “Not only do they have a 30% higher average lifetime value compared to other customers, they also buy more often, and more importantly, they become referrers themselves.”

When it comes to referral rewards, incentive matching has become increasingly popular. However, depending on your industry, third party gift cards and free products are also great incentives. The key is finding opportunity to create awareness and to increase your brand’s outreach. Because a great referral program can help you increase average order value, increase repeat purchase rate, and create a larger community of brand advocates. To see the full extended interview, see transcript below:

How can a referral marketing program bring ROI?

So referral marketing programs are a great acquisition tactic. Imagine you didn’t know about this brand and you’re a friend of mine and I love their products. If I told you to come back and consider this product you would. Referral marketing is a way of getting your loyal customers to refer other people that may or may not know about that brand. Then the objective is for them to come back and potentially connect with and ideally buy from that brand.

What is the difference between referred customers and other customers?

Another thing we track with our technology that we have great numbers on, is the lifetime value referral customers. Referral customer stay around longer and can have up to a 30% better lifetime value in comparison to the average customer through other channels. The reasons behind that is the referral customer comes through a trusted channel network to try a certain product and they know before buying that this is going to be the right products and services for them. Thereby, they stick around longer, they buy more often, and more importantly, they become referrers themselves.

What is the difference between pre-purchase and post-purchase referrals?

The goal in terms of referrals is not just to convert your existing customers, but to have them refer their other friends. Which is what post-purchase referrals is all about. Post-purchase referrals is if I bought something from that brand, I’m more likely to tell other people about this great purchase I just made.

But pre-purchase referrals is a great way to get consideration for a specific product. Imagine I’m on a product page, I can tell other people that I’m considering this product. Then, get their viewpoints on it before I’m making the purchase. Pre-purchase is all about considering the purchase. And post-purchase is all about telling everyone how happy this person is about the purchase.

Annex Cloud is leading the industry when it comes to referral marketing, customer loyalty, and user generated content. We help hundreds of brands internationally implement custom solutions to get the most from their customers. Have any questions about how to best market your referral marketing program? Wonder how referrals can affect your bottom line in the coming year? Contact us for a free consultation and our experts will review a strategy that’s just right for you!

[White Paper]
[White Paper]