A referrer in a loyalty program is an existing customer who recommends the program or a business to a new potential customer. This recommendation typically involves the referrer sharing a unique referral link or code with their friends, family, or acquaintances.
Here’s how it generally works:
- Sharing: The referrer shares their unique link or code through various channels like email, social media, or direct messaging.
- Sign-up/Action: The person receiving the referral (the referee) uses the link or code to sign up for the loyalty program or make their first purchase with the business.
- Reward: Once the referee completes a qualifying action (as defined by the program), both the referrer and the referee often receive a reward. These rewards can vary widely and might include:
- Discounts on future purchases
- Bonus loyalty points
- Free products or services
- Cashback or credits
The goal of having referrers in a loyalty program is to leverage the power of word-of-mouth marketing. People are more likely to trust recommendations from their friends and family than traditional advertising. By incentivizing existing loyal customers to spread the word, businesses can acquire new customers more effectively and build stronger customer relationships.