7 min to read
5 ways to make your e-commerce referral marketing program stand out in India
Simple yet actionable tips to get your customers to refer you.
Table Of Contents
If you’re running a brand in India or are in the marketing team of one, you’ve definitely heard of referral marketing.
With the sheer amount of digital noise and the number of brands that consumers are exposed to how do you make sure that your referral campaign works? Today we’ll go over 5 very actionable tips crafted just for Indian brands. (P.S. number 4 is my favourite!)
Before we dive into the 5 points however, there is just one thing to keep in mind. Referral marketing is solely based on 1 underlying factor and 1 factor alone, and that is trust. Your customers will only share about you if they trust your brand and products. So! Let’s cut the fluff and jump right in.
Tip 1: Provide exceptional customer service
This is the most important and usually the most overlooked. As I mentioned, the heart of referral marketing is trust. Unless customers trust & love your brand, it’s unlikely that they’ll refer anyone. Put yourself in their shoes. Would you ask your best friend to buy from a brand you’ve had a poor experience with? Hardly likely (unless you actually hate him!).
You’ll need to ensure that your customers have a seamless experience with you. And great customer service is the only way to do that.
If you’ve ever read about customer support, you would have heard about Zappos. They are known to provide the best support as compared to any D2C company out there. From trekking with their customers to being invited to their weddings, Zappos reps make it their purpose to forge a bond with every customer they interact with. They talk about it themselves in their blog
They go out of their way to make sure each customer has an incredible experience
If you’ve had experiences like this wouldn’t you tell your friends about it? I sure as heck would!
Tip 2: Make your product shareable
People love to share cool stuff because they feel it makes them look cool. It’s that simple. (Not really… There is a complete branch of psychology that focuses on something called social currency. Basically what makes people share things)
Making the product and unboxing experience great is a sure-shot way of increasing your reach. So invest a little in the packaging and unboxing and it’ll pay you back tenfold.
Haus is an alcohol brand from California. Instead of using their packaging to just deliver the products to customers, they use it for a much larger purpose as a home decor element.
Each package of Haus is clean and minimal giving it a very premium feel. Within each box is a booklet that pulls customers into the story of the product, giving them cocktail recipes and covering frequently asked questions, making it an experience to remember.
This leads to a lot of customers posting about then online, increasing their reach a lot more effeciently than what paid ads can do.
Shopify has some great tips for product packaging which you cnan read in their blog here
Take the time to craft a great packaging and unboxing experience. The more memorable you make it for your customers the more it’ll be shared. It’s that simple!
Tip 3: Reward your referrers well
Make sure that the rewards you provide for the referral are really worth your customer’s time and efforts. Be generous and your referrers will too!
Many brands feel that they can’t afford to provide an additional discount, since they’re already spending a lot on channels like Facebook Ads and thus an additional discount will drop their margins even further.
Although the profit margin is an important metric, this isn’t the best way to look at it. Referrals are an ‘additional’ sales channel and shouldn’t be clubbed with your current CAC (Customer acquisition cost) calculations.
Say for example your AOV (Average order value) is Rs. 1500. Usually, your CAC would be between Rs. 200 to Rs. 500 (if you’re doing better than that, please drop me a line at rohit@creto.club. I would really love to know how!). As compared to this, a 10% discount to customers for a referral would mean a CAC of Rs. 150.
It should be clear as day which is a better option! (You might also want to factor in the reach that the Facebook campaigns give you in front of prospective customers. This is why referrals aren’t an alternative to paid ads but can be great for your marketing mix)
So remember to be generous while offering discounts and cashbacks to referrers and referees. A well-planned discount structure will help you reach a lot more relevant customers without breaking the bank. A good rule of thumb might be around 50% to 100% of your current CAC on paid ads.
An even smarter way of going about it might be to offer dynamic discounts based on the social media following of your customers. We’ll go over that in a future post 😉
Tip 4: Make the program easy to access
It’s a well-researched fact that most humans are a little lazy by nature. The easier a task is, the greater the chance that people will do it.
When you think about it, many brands have a referral process that is extremely complicated from the customer’s perspective. Order, get a link, wait for an interested friend, search the link in a bunch of emails, send the link to him, contact the brand and track the referral payout, whew… It’s a lot easier to do nothing at all. And that is exactly what most people would do… nothing.
Keeping your referral and rewards processes simple can help you get a huge conversion rate jump in your program.
Also, keep in mind that referrals don’t happen instantly. The customer needs to try the product, talk to friends, and then find someone interested. Because of the large lead-time, many of them would drop off mid-way. Thus keeping the process easy to access is extremely important.
The current off-the-shelf tools available, like ReferralCandy, have their limitations. The biggest being that they use email, which doesn’t convert well, especially in India. Also, the customer journey usually ends with 1 referral, which doesn’t increase the CTLV (customer lifetime value) by much.
We’re trying to fix just this! Check out our website to take a look at what we’re up to, if you want to improve your referral program.
Tip 5: Analyze and A/B test
This is something that most brands don’t do!
The biggest advantage of being a digital-first brand is that you can analyze, test & optimize your conversion funnel. The biggest mistake brands make is that they plan a referral campaign and then just leave it as it is for months or even years.
Instead, you should analyze how the campaign is going, which channels people are using the most to share about you, what discount amounts work best, etc. And then A/B test the messaging to see what converts the most (An A/B test is a way to test 2 or more different options to understand which is better. Don’t worry, we’ll go into the details in another post).
TL;DR
- Provide exceptional customer service
- Make your products and packaging shareable
- Reward your referrers well. The more you give the more you’ll get back!
- Make the program easy to access for your customers
- Analyze & A/B test the referral campaign and messaging
So, what’s next
If you had any questions or needed personalized tips on how to improve your referral program, just drop me a link to your website on rohit@creto.club and I’ll do what I can to help.
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