On this Page:
- Why use a referral program?
- How it Works
- Configuring Referrals
Why Use a Referral Program?
Customer acquisition can be challenging, but it is important for businesses of all sizes. Creating leads is one thing, but convincing prospects to make a purchase is another! Referral programs are a great way to enlist your current customer base to generate leads and create intention for new customers to make purchases.
Word of mouth referrals are one of the most impactful ways to acquire new customers. With so many purchasing options available these days, it can be difficult for consumers to choose where to purchase from. There is risk associated with purchasing from a new brand online. What will the experience be? Will the product be high quality? Will the product meet expectations? Much of the risk associated with trying a new online brand can be mitigated with personal referral programs. Consumers are more likely to try a brand that is recommended to them by someone they trust, whether that is a friend, family member or social media personality. There are fewer unknowns when making a purchase that others have already verified and believe are worth the cost.
Using incentives to promote referrals encourages both the referrer and the newly referred customer. When a loyal customer of your store refers someone new they are rewarded with a perk. This encourages the existing loyal customer to make repeat purchases. When a new customer is referred, they receive a perk to encourage going through with the sale. This has the added benefit of lowering the risk of making a first time purchase as well. When newly referred customers receive a perk (like a discount) it offsets some of the unknowns with a first purchase.
Referral programs are often more cost effective for customer acquisition than many other advertising and marketing strategies. There is little overhead associated with referral programs and almost no maintenance required. This makes them a great way to grow your customer base with little effort. Employing your existing customer base to find and persuade potential customers to purchase from your store promotes loyalty to your brand and encourages deliberate and repeat customers.
How it Works
The Simple Loyalty referral program is just that, simple! It is built on top of the existing loyalty program functionality, allowing for a seamless extension of your customer acquisition and retention strategy.
Loyalty members can get a personal discount code to share with potential customers. The discount code is used to encourage new customers to make a purchase. When a loyalty member's code is used to complete a purchase, they will receive points that can be redeemed for rewards in the same way they would with other types of points.
This program is built to be flexible, with very little effort required of both the existing and new customer. It can work as a friends & family referral program, a larger scale program for social media & YouTube personalities, or both. Loyalty members can share their code on a personal level with people they know directly, but the program is built in a way that allows for discount codes to be shared on larger platforms. No matter what your marketing strategy is, Simple Loyalty referrals can extend your efforts seamlessly.
Specific discount codes can be edited by a store admin to make them more personal or easier to share if desired. When initially created the code will follow the structure of the member's first name and last initial followed by four random numbers.
In the App admin, you can view how many times a member's code has been used. Advanced analytics detailing the overall success of the rewards program are available in the Analytics section of the app.
Setting up referrals is as easy as setting a point amount for members and a discount amount for newly referred customers. When members successfully refer new customers, they will earn points that can be used to redeem any of the existing program rewards (granted they have enough points!).
- Navigate to Program Settings in the App admin.
- Enable Referral Points in the Referrals section of the program configurations.
- Set the number of points members will receive for completing a referral.
- Select the type of discount and the discount amount that will be offered to newly referred customers.
- A discount will be generated in Shopify Admin under Discounts called Simple Loyalty Referral Discount. When a referral code is generated for a specific loyalty member, the code will be visible under the global discount in Shopify.
- Save your settings and the referral program will be live!
Loyalty members' specific referral codes can be edited for a more personalized code if desired. This is done in the member profile.
- Navigate to Members in the App Admin.
- Open the member profile.
- Navigate to the referrals card and select Edit Code.
- Personalize the code as desired and save the changes.
- Changes will be reflected in the loyalty widget for the member to view as well.