How to get more customer referrals & grow word of mouth
Marketing Minute

How to get more customer referrals & grow word of mouth

Want more referrals? Stop making it about you. Flip the script and make it about them—your customers and their friends. Help your customers help their friends!

So...why does it work? 🤔

Research shows that an altruistic spin like "Give your friend a 70% discount!" boosts the odds of a referral by 60% and total referrals by 86%. It's like social currency but without the awkwardness of asking for a favor. So help your customers hook a brother up and see those referrals soar.

It turns out that referrals are the OG social media -- social before social was cool. Why? Because we naturally want to share cool stuff with our friends. Adding a selfish incentive muddies the water. But make it about helping a friend, and you've got a winning combo.

Examples

Here are some examples of big brands using this.

Brand Existing Customer Reward New Customer Reward Why it Works
Dollar Shave Club $5 off next purchase $5 off first purchase Simple, instant gratification
Glossier $10 in store credit 10% off first purchase Builds brand loyalty, higher conversion
Casper $75 Amazon gift card 10% off mattress High-value reward, big-ticket discount
Warby Parker $5 off next purchase $5 off first purchase Low-risk, encourages repeat purchases
HelloFresh $20 off next box $40 off first box High new customer incentive, recurring benefit for existing customers


When & who

So, when should you do it, and who should you target for the best results?

  • Timing is everything: Ask for that referral right after they've made a purchase. The glow of a new buy makes people more likely to spread the love.
  • Know your audience: If you can, target this to your repeat customers and those with high NPS scores. They're 73% more likely to refer.

Follow those two guidelines for the best chance of success.

How to use it

Ready to try it? Here's what to do:

  • Tweak your CTA: Change your referral call-to-action to focus on the friend's benefit. "Your friend gets X% off, and so do you."
  • Test the waters: Try offering the discount only to the friend. It could save you some cash and still get you that sweet, sweet referral.
  • Segment & target: Aim this campaign at your loyal customers and those who are super satisfied. They're your low-hanging fruit.

So, try it out and be the matchmaker by helping your best customers play hero and refer their friends with discounts!

Want to learn more? 🤓

If you want to learn more about this topic, you can dig into the nerdy details in the original marketing study here.

Quote of the week 💬

"Hooking up a friend with a referral discount is like sharing your Netflix password: It's a small favor that earns you big friendship points."

About the author
Gabriel Mays, the Co-Founder and CEO of POPSMASH
Gabriel A. Mays
Gabriel Mays' Website
Co-Founder & CEO at POPSMASH
Before POPSMASH, Gabe was a Director at GoDaddy and founded two startups. He was also a Marine Corps Captain, serving in Iraq and Afghanistan. He lives with his wife and two kids on Cape Cod, MA.

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