No matter how confident you are in your product or service, you mustn’t take it for granted that customers are automatically going to recommend your brand to others. Research from Texas Tech suggests that customers don’t often act to make a referral even if they feel inclined to do so.
In fact, whilst 83% of satisfied customers would be happy to refer a friend to a brand, fewer than a third actually do so. Part of this shortfall may be explained by badly structured referral programmes or even not having one in place at all.
Get your referral marketing right and you’re onto a winner as far as your marketing strategy is concerned. Customer referrals tend to have higher profit margins and multiple studies show that word of mouth referrals by peers tend to be highly trusted by consumers.
To succeed at getting referrals means you first need to gain control of your referral programmes – often quite literally. It’s still unusual for marketing managers to be in charge of referral programmes, yet research shows that companies who put the marketing team in charge of a formalised referral programmes tend to have higher revenue growth compared against those that don’t.
Customers tend to most trust and value the recommendations of their peers and it’s often a low-cost acquisition method. Many people get social cachet from being a referrer – they’ll voluntarily crow about your product or service without thought of any reward besides promoting their own experience of your brand.
But you can incentivise this behaviour by crafting referral programmes that encourage your existing customers to promote you to their contacts. Many brands incentivise customers to refer their friends but what’s surprising is that the size of the reward doesn’t actually seem to be all that important.
A study by the American Marketing Association suggests that referral programmes offering a reward see more referrals happening but increasing the size of that reward doesn’t seem to increase the number of referrals.
The good news is there are a host of tools in the marketplace to support a formalised and automated referral programme for your business. The bad news is not all of these tools offer the sophistication to manage a multilingual referral programme.
If you’re trying to target a complex language base, including Chinese, Arabic or Turkish, you’ll have to make sure you’re approaching these customers in the right language. You may also find you’ll get best results by optimising your referral offer for each audience.
Audiences in some cultures may respond differently to different approaches when it comes to things such as phrasing your referral offer, incentivising that offer and even things such as the design of the referral page.
Perhaps the most important thing you can do to support multilingual audiences is to create a referral programme that’s consistently designed for them in their own language. It’s important that you take them through the entire referral journey in their own language, otherwise, they are highly likely to abandon their effort.
It’s also worth saying that their contact is likely (but not certain) to speak the same language as them, so make sure the referral path leads back to content in the user’s original language.
Nudging the user
You can also apply the basic EAST principles, more commonly used as part of the behavioural insights framework to improve public policy and encourage the public to make the best choices when it comes to behaviours such as recycling or saving for a pension.
Under the EAST framework, you should make it Easy, Attractive, Social and Timely for the user to perform the action you want, such as sharing a referral link on their own social media for example.
You can make it easy for people to refer others to your brand by giving them a simple means of doing so. Hairdressers hand out discount cards for customers to share with friends that they can put in their purse when paying.
You can place a share button at the end of the payment process so your online customers can tell their friends that they’ve just bought something from you. It makes it as easy as clicking a button for the customer to make their referral.
Crafting the right incentive can really boost your referral rates. Many businesses offer discounts to customers who successfully refer a friend who makes a purchase. Some offer upgrades to the basic service they offer if customers make a certain number of referrals.
You may not need to offer a discount or financial incentive – some customers in different markets may be better motivated in other ways. Whether you’re offering a financial incentive or not, try to make it seem as attractive as possible to refer people to your brand. Use positive language and emphasise how your referral will benefit the user’s friends.
For many customers, social validation is a reward in itself, and there’s social validation associated with making brand recommendations particularly in highly collectivist cultures such as China.
Understand what social validation customers get from associating themselves with your brand and try to maximise this. Appealing to their altruism can support this such as by making it possible for customers to support a cause or their local community by referring others to your service.
You need to pick the optimum time to ask your customers to make a referral. This may not be immediately after purchase but rather at a slightly later date when they’ve had to chance to use your product or service and formulate their opinions. Getting the customer at the right time is really all about catching them in the right mood to recommend your brand.
A successful referral programme also tends to be simple. Don’t try to overcomplicate the structure of your referral programme as it’s likely to make customers suspicious or just disinterested. Capturing customer referrals really isn’t rocket science but you need to set your brand up for success by making sure it’s really easy for customers to act on their existing inclination to refer others to your service.