Dropbox, an online storage company, has quite an impressive referral program. In their most basic program, by referring your friends to Dropbox you get 500MB more storage, and the person you referred gets 500MB more storage. Sounds simple, right? Simple enough to gather a 3900% growth in their company in 15 months? How about gaining 4M new customers in the same amount of time, where 35% of the daily signups are from referred users? Yes, Dropbox’s referral program is a huge success story. Referrals work, it’s as easy as that. So if you’re in sales, do yourself a favor and start a referral program.

Developing your Program
Getting your referral program to be successful isn’t as easy as it may seem. But it’s worth it to tinker around until you get it just right. Programs that offer credit towards use within the company (like Dropbox offering more storage on Dropbox), can assure that not only will you have a new customer from referral, but the costumer who referred them will be back again! Aside from Dropbox, there are tons of extremely successful referral programs. For example, PayPal, Uber, and AirBnb, all have a lot of revenue that they can thank their referral programs for.

Use Your Current Customers to Target New Ones
A 2009 study published by the American Marketing Association found that peer recommendations are 2.5 times more responsive than any other marketing channel. Statistics like this show us just how influential our customers can be. Not only can they help us gain revenue and feedback on our product, but they can also help us gain new customers. Your current customers can also give you insight as to the types of people who are attracted to your product. By keeping in mind what drew people in before, you can use that to target new potential customers with your referral program.

Analyzing your Referral Success
While analyzing your referral program, there’s a lot of different factors to look into. You want to make sure you’re giving your customers enough incentive to refer, without giving them so much that you’re losing revenue. The measure of return on your investment (also called ROI), is a very important measurement to keep of. Many different tools exist to help you calculate your ROI.
ROI aside, tools like Google Analytics can show you exactly who is signing up from referrals. If you notice barely anyone is using your referral program, you might want to revamp it. The promise of something in return isn’t always enough to gather interest for referring, you need to make sure your program is beneficial enough that your clients are on board.

Well what are you waiting for? Start designing your referral program today, it could benefit you and your company beyond what you ever thought possible.

BACK NEXT