Referral programs are a great way to grow your brand and reward advocates for sharing your offers with their network. You want customers will embrace your program for what you intended it to be, which is a way to share a brand they love with friends and family andensuring that your program is set up to maintain quality is key. This requires both using a reliable referral platform and identifying the validation rules that are most beneficial for your business.
4 Tips for Maintaining Referral Program Integrity
When setting up your referral program, there are several steps you can take to help ensure you maintain the highest quality.
1. Create a high bar to earn incentives.
Programs are most successful when the referred friend has to take some sort of action, such as making a qualified purchase, before the advocate is rewarded for that referral. People can talk to their friends all day long about brands that they love, but the goal of a referral program is to acquire new customers. Tying advocate rewards to a purchase event ensures ROI because you’ll generate revenue from the friend sale before spending to reward the advocate.
2. Configure your business rules.
Determine the optimal way to reward advocates and incentivize new friends to make their first purchase while protecting your brand at the same time. This might include creating business rules such as:
- A Minimum purchase threshold: This rule requires the referred friend to purchase a certain dollar amount in order for the advocate to receive their reward.
- New customer check: Confirm that the referred friend is a new customer before distributing the reward to the advocate after the referred friend’s first purchase.
- Account for returns / order cancellations: Determine whether or not your referral platform should fulfill the reward for a conversion based on the logic in your own system, such as returns or cancellations.
- This is best used with a feature that allows you to delay the processing of a reward until a specified amount of time has passed. For subscription businesses, create a business rule that only rewards advocates when their referred friends have converted from a trial to a paid account.
If you use coupon codes to reward advocates and incentivize referred friends, establish parameters for redemption, such as:\
- Expires after one-time use
- Minimum purchase amounts
- New customers only
3. Limit the number of rewards an advocate can earn within a certain timeframe
If you’re offering cash or gift cards, it’s helpful to incorporate a reward limit for your advocates, based on either the number of rewards or the total value of the rewards.
4. Choose a reliable referral platform.
Work with a provider that has the technology to use algorithms that detect and mitigate self-referrals. This eases the burden on your team by automatically identifying potential issues. The referral platform you choose should also allow you to implement business rules for appropriate reward validation and fulfillment when setting up your campaigns.
Protect Your Brand with Friendbuy
The Friendbuy platform is designed to help you maintain referral program integrity with minimal effort. Our team will help you set up the business rules that make the most sense for your brand, and the technology does the rest. With compelling offers, enticing calls to action, and the right platform, you can take your brand to the next level with referral marketing.
To learn more about growing your brand through referral marketing, check out Referral Marketing: The Essential Guide.