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6 Referral Marketing Best Practices To Turn Customers Into Word-Of-Mouth Marketers

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Word-of-mouth (WOM) is becoming retailers’ most powerful marketing channel. In fact, 80% of all purchase cycles involve some form of WOM recommendation, according to Forrester Research. These recommendations can drive three to five times more conversions over any other marketing channel.

To harness the power of WOM, retailers’ customer acquisition strategies must include a referral marketing program. The resulting WOM recommendations can help retailers increase awareness, acquire new customers and boost overall sales.

During this webinar, you’ll learn:

How referral programs help drive customer acquisition;
Best practices to increase awareness and new sales via referral programs; and
Ways to measure program results and calculate “real” ROI.


Register for the webinar, titled: 6 Referral Marketing Best Practices To Turn Customers Into Word-Of-Mouth Marketers, and learn how you can turn one-time shoppers into life-long brand advocates.

Published in: Business, Technology

6 Referral Marketing Best Practices To Turn Customers Into Word-Of-Mouth Marketers

  1. 1. 6 Referral Marketing Best Practices to TurnCustomers into Word of Mouth Marketers
  2. 2. Agenda1.  Overview of Retail Landscape2.  What is a Referral Program?3.  6 Best Practices for Referral Programs4.  Expected Results and Case Studies5.  Q&A
  3. 3. #WoM  Type  ques)on  here  Welcome  Webinar  A0endees  
  4. 4. #WoM  Follow  This  Webinar  On  Twi0er  #WoM
  5. 5. #WoM  About  Retail  TouchPoints  ü  Launched in 2007ü  Over 26,000 subscribersü  To provide executives with relevant,insightful content across a variety ofdigital mediumFree subscription to our weekly newsletter:WWW.RETAILTOUCHPOINTS.COM/SIGNUP
  6. 6. #WoM  Panelists  Angela BandlowVP of MarketingExtoleAlicia FiorlettaAssociate EditorRetail TouchPointsMODERATORAshley FutakSenior Marketing ManagerExtole
  7. 7. Overview of Retail Landscape
  8. 8. #WoM  Consumers  Trust  Social  Media  Connec)ons  More  Than  Brands    of  U.S.  consumers  say  they  trust  brand  and  product  recommendaBons  from  friends  and  family.    of  consumers  say  they  trust  posts  created  and  shared  by  brands  and  companies  on  their  social  accounts.      Only  Source:  Forrester  Research,  "How  To  Build  Your  Brand  With  Branded  Content"      
  9. 9. #WoM  As  If  You  Needed  Addi)onal  Proof…  Source:  Nielsen,  Social  Media  Report  2012    of  social  media  users  learn  about  brands,  products  and  services  through  social  networks.    of  users  hear  about  their  friends  and  colleagues  experiences  using  those  products  and  services.      
  10. 10. #WoM  A  New  Era  Of  Brand-­‐To-­‐Shopper  Communica)on  "The  days  when  companies  could  Bghtly  control  brand  messaging  and  progress  consumers  along  a  linear  purchase  funnel  have  long  ended.  Social  media  has  fundamentally  changed  the  consumer  decision  journey.  Consumer  decisions  and  behaviors  are  increasingly  driven  by  the  opinions,  tastes  and  preferences  of  an  exponenBally  larger,  global  pool  of  friends,  peers  and  influencers."    Source:  Nielsen  Research,  Social  Media  Report  2012    
  11. 11. #WoM  Iden)fying  The  Value  Of  WOM    Source:  MarketShare  WOM  increases  markeBng  effecBveness  by  up  to  54%  
  12. 12. #WoM  ü  A  discount  code  or  coupon  for  “Liking”  or  Following  a  brand  page  (35%)    ü  Access  to  limited-­‐Bme  offers  for  sharing  social  content  (35%)    ü   Discounts  on  e-­‐Commerce  purchases  for  referring  friends  and  family  (20%)    Retailers  find  the  most  effecBve  incenBves  for  social  communicaBon  to  be:    Source:  2013  Social  Commerce  ImperaBves  survey,  Retail  TouchPoints    59%  of  Retailers  have  a  Social  Commerce  strategy  in  place  in  2013,  up  from  48%  in  2012.  How  Retailers  Are  Keeping  Pace  
  13. 13. #WoM  Learn  From  Some  Of  The  Thought  Leaders  Bonobos   PoWery  Barn  
  14. 14. What is a Referral Program?
  15. 15. Extole: the Leader in Referral MarketingPage 15© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.Drive acquisition through customer word of mouth:•  Launch world-classcustomer referral programs•  Tap into a new high-value marketing channelAbout Extole:– Founded in 2009– 300 leading brandsTRYBRAND“X”
  16. 16. The Challenge: Rising Above the NoisePage 16© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.WOM recommendations break through the noise3000 brandimpressions/ day92% ofconsumers trustrecommendationsfrom friends, 33%trust online ads- Nielsen80% of allpurchase cyclesinvolve some formof WOMrecommendation- Forrester WOMrecommendationsconvert at 3-5xother channels- WOMMA
  17. 17. Overview of a Referral ProgramPage 17A referral program is anend-to-end program to:• Engage a brand’scustomer advocates• Foster sharing ofreferrals from advocates• Convert friends into newcustomers• Monitor performanceand optimize results© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  18. 18. Folica: Turning Advocates into MarketersPage 18GOAL:• Acquire new customers viareferrals from existingcustomersPROGRAM:•  Advocate: $10 credit•  Friend: $10 off first purchasePROMOTION:•  Website, Facebook, email,Twitter & newslettersINDUSTRY: Retail, Health & Beauty© 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
  19. 19. Promoting the Program19© 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
  20. 20. Advocates Share Over Email20© 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
  21. 21. Advocates Share via Facebook21© 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
  22. 22. Advocates Share via Twitter22© 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
  23. 23. Friends Receive Offer via Sharing Messages23© 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
  24. 24. The Bottom LineRESULTS: (After 30 days)• Advocates………………..6,000+• Shares per Advocate……4• Total Shares…………….. 21K• Email Open Rate………..93%• Conversion Rate………...16%24© 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
  25. 25. 6 Best Practices forReferral Marketing Programssocialreferralsamplifybrand reach
  26. 26. Best Practices for Referral ProgramsPage 26 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  27. 27. 1. Creating a Compelling Offer•  What to consider:–  Compelling offer for customer advocates–  Unique offer for the friend–  Balanced offer structure–  Testing and optimizing•  Offers – what will resonate with your customers?–  Free goods, discounts, exclusive product, loyalty points–  Related products–  Gift cards–  Charitable donationsPage 27 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  28. 28. 1. Creating a Compelling OfferPage 28 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  29. 29. 2. Promoting the Program•  What to consider:–  Promotion across owned assets•  Website•  Email lists•  Communities•  Social networks–  Promoting at key customer touch points•  Order confirmation pages•  Purchase confirmation emails•  Pop-up messages and banner ads within digital products–  Keeping promotions fresh with a clear CTAPage 29 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  30. 30. 2. Promoting the ProgramPage 30Email WebsiteFacebookPost Transaction© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  31. 31. 2. Promoting the ProgramPage 3136%21%11%11%6%4%3%3%2%2%1%HomepagePost-purchaseNewsletter EmailIn-ProductOtherDedicated EmailMy Account PageDedicated PageDrip Remarketing EmailHeader/FooterSocial Media PostParticipation by Promotion Placement© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  32. 32. 3. Making it Easy for Advocates to Share•  What to consider–  Messages: Default or Advocate Created•  Sharing channels–  Email–  PURL–  Facebook–  TwitterPage 32 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  33. 33. 3. Making it Easy for Advocates to SharePage 33 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  34. 34. 3. Making it Easy for Advocates to Share•  Email Sharing–  1 to 1 share–  Personal recommendation–  Highest conversions•  Default Messages–  Read like a story with a personal touch–  Tells the friend about the offer they willreceive–  Include what the advocate gets if the friendconvertsPage 34 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  35. 35. 3. Making it Easy for Advocates to Share•  PURL (Personal URL) Sharing–  Personalized links which brands can provide to advocates to shareprograms with friends across channels and platforms–  Simple, flexible, can be used for 1 to1 or 1 to many sharing–  Less control for brand•  Default Messages–  N/APage 35 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  36. 36. 3. Making it Easy for Advocates to Share•  Facebook Sharing–  1 to many share with friends–  Social context–  Higher amplification than 1 to 1 shares•  Default Messages–  Read like advocate speaking directlyto friends–  Include rationale for why they aresharing with friendsPage 36 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  37. 37. 3. Making it Easy for Advocates to Share•  Twitter Sharing–  1 to many broadcast share–  Highest amplification, lowest conversion•  Default Messages–  Condensed message to world at large (140 characters)–  Use @TwitterHandle for brand to increase SEO–  Use hashtag (#) for programPage 37 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  38. 38. 4. Personalizing the Friend ExperiencePage 38•  What to consider–  Make it short and to the point–  Describe the offer–  Make it personal–  Keep the CTA simple© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  39. 39. 4. Personalizing the Friend ExperiencePage 39 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  40. 40. 5. Keeping the Program Top of Mind•  What to consider–  Remarketing–  Advocate DashboardsPage 40 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  41. 41. 5. Keeping the Program Top of Mind:RemarketingPage 4110.5%increase inadvocatesengaged14%of alladvocateshares29.5%of all finalconversions© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  42. 42. 5. Keeping the Program Top of Mind:Advocate DashboardPage 42 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  43. 43. 6. Monitoring and Optimizing the Program•  What to consider–  Visibility into program funnel–  Ongoing testing•  Offer•  Promotional placements and copy•  Default sharing messages•  Remarketing–  OptimizationPage 43 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  44. 44. 6. Measure and OptimizingPage 44advocatessharesreferralsconversionsshares per advocateclicks per shareconversion rate© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  45. 45. 6. Monitoring and Optimizing the ProgramPage 45LaunchReferrals grewFrom 15 to 3,000Largest AcquisitionChannelOptimization PeriodFinancial Services Example© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  46. 46. Expected Results & CaseStudiessocialreferralsamplifybrand reach
  47. 47. The Referral Marketing FunnelPage 47advocatessharesreferralsconversionsshares per advocateclicks per shareconversion rate© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  48. 48. The Referral Marketing FunnelPage 4830-50% emailopen rates20-60% ofcustomers becomeadvocatesAdvocates sharean average 5.4X3-5Xconversion rateadvocatessharesreferralsconversionsshares per advocateclicks per shareconversion rate© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  49. 49. Channel PerformancePage 49FacebookPURLEmailTwitterEmailFacebookPURLTwitterFacebookPURLEmailTwitterEmailFacebookPURLTwitterClicks per Share by Channel Conversion Rate by Channelhighest in social channels—Twitteris highest; email is lowest.Conversion rate is highest inone-to-one sharing—email is highest;Twitter is lowest.© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  50. 50. Quantifiable Marketing ResultsPage 5030%Referrals2.3MStories500KRevenue$Entertainment/ MediaConsumerElectronicsOnline Health& Beauty233%AOV5000Customers433%ConversionsFinancialServicesAutomotiveOnline ApparelAwarenessReferral RateConversionRateCustomerAcquisitionRevenueAverage OrderValue6Months11Months30Days150Days30Days45Days© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  51. 51. Women’s Retailer: Boosts Referral Sales 4xPage 51GOAL:•  Drive WOM recommendations to boostsales and build communityPROGRAM:•  Original Offer: $10 for advocate, $10for friend•  Double Rewards: $20 for advocate,$20 for friendRESULTS: (Per Month)Original Double•  Advocates………… 10K+…… +33%•  Share Rate……….. 2.3……… +57%•  Friend Clicks……… 12K+ …... 3x•  Sales………………. 1000+….. 4xRetail:Apparel© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  52. 52. Roku: Driving Sales via Customer ReferralsPage 52GOAL:•  Drive new customer acquisitionthrough word of mouth referralsPROGRAM:•  Advocate: free month of NetflixRESULTS: (After 6 months)•  Advocates……………….. 40k+•  Referrals per Month.…… 10k•  Revenue…..…………….. $250K•  Customer Referrals…….. +30%INDUSTRY: Consumer Electronics© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  53. 53. Conclusion•  Word of mouth is a critical marketing channel•  Referral programs harness the power of brandadvocates to drive new sales and acquisition•  Best Practices Recap:1.  Create a Compelling Offer2.  Promote the Program3.  Make it Easy for Advocates to Share4.  Personalize the Friend Experience5.  Keep the Program Top of Mind6.  Monitor and Optimize the ProgramPage 53 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  54. 54. Q&A•  Submit all questions via the Questions section ofyour GoToWebinar Control Panel and send to eitherpresenterNext Steps•  Download this presentation at: http://rtou.ch/womwebinar•  Download Extole’s Ultimate Referral Marketing Guide – extole.com•  Stay Current on Extole News and Happenings!–  extole.com/blog/Page 54 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
  55. 55. | 877 739 8653 | hello@extole.com |Contact Us625 2nd Street St. #101San Francisco, CA 94107Thank You

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