E-commerce referral programs are specifically designed by brands for their existing customer base. This program incentivizes and rewards customers for sending out referrals to bring new leads to the business. Most loyalty programs focus on the retention of customers to increase a business’s profitability. E-commerce referral programs target both retention and acquisition as they incentivize existing customers to bring new customers to the business.
Benefits of ecommerce referral programs:
It is four times more likely for people to make purchases from an unknown brand when referred from a friend or known one. Word-of-mouth marketing has a greater impact on customers as it comes from a reliable source and not directly from the brand itself. Below mentioned are few benefits that an effective ecommerce referral program offers:
Strategies to launch Referral Programs:
Examples of ecommerce referral programs:
Starbucks- Starbucks has definitely taken its coffee game one step ahead with a very effective referral program. Discontinuing its pre-existing referral program back in 2016, the brand came back hitting a massive success, close to owning a multi billion dollar franchise in today’s marketing arena. Emphasizing on creating and maintaining a standard of sophistication, this brand beautifully identified its target audience by coming up with an incentive of “Gold” with the combination of a visual showcasing two coffee mugs. On referring the program to a friend and making them sign up, the customer gets 6 stars along with incentive and free drinks on birthdays.
Amazon Prime- The world’s largest retailer established an empire worth 1.7 trillion dollars, implementing one of the best and strategically designed referral programs, as this huge retailing giant identified the importance of customer reference as one of the most effective customer acquisition channels. The brand has successfully designed a referral program that is meant to feel personal and is extremely feasible. From sending out referral mails to enabling the use of exclusive products for clients who do not have prime membership, the brand has perfected their referral game. Amazon has set its very own benchmark by introducing the first ever double sided incentive program, where both advocate and the friend are rewarded for engaging in the referral program. Conquering the ecommerce department, the brand’s app is already ranked first in app store and is rewarding $10 to customers who are using the mobile app for the first time.