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

6 Referral Marketing Best Practices to Turn
Customers into Word of Mouth Marketers

Agenda
1.  Overview of Retail Landscape
2.  What is a Referral Program?
3.  6 Best Practices for Referral Programs
4.  Expected Results and Case Studies
5.  Q&A

#WoM

Type
ques)on
here

Welcome
Webinar
A0endees

#WoM

Follow
This
Webinar
On
Twi0er

#WoM

#WoM

About
Retail
TouchPoints

ü  Launched in 2007
ü  Over 26,000 subscribers
ü  To provide executives with relevant,
insightful content across a variety of
digital medium
Free subscription to our weekly newsletter:
WWW.RETAILTOUCHPOINTS.COM/SIGNUP

#WoM

Panelists

Angela Bandlow
VP of Marketing
Extole
Alicia Fiorletta
Associate Editor
Retail TouchPoints
MODERATOR
Ashley Futak
Senior Marketing Manager
Extole

#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"

#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.

#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

#WoM

Iden)fying
The
Value
Of
WOM

Source:
MarketShare

WOM
increases
markeBng

eﬀecBveness
by
up
to
54%

#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

#WoM

Learn
From
Some
Of
The
Thought
Leaders

Bonobos
PoWery
Barn

Extole: the Leader in Referral Marketing
Page 15
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
Drive acquisition through customer word of mouth:
•  Launch world-class
customer referral programs
•  Tap into a new high-
value marketing channel
About Extole:
– Founded in 2009
– 300 leading brands
TRY
BRAND
“X”

The Challenge: Rising Above the Noise
Page 16
WOM recommendations break through the noise
3000 brand
impressions
/ day
92% of
consumers trust
recommendations
from friends, 33%
trust online ads
- Nielsen
80% of all
purchase cycles
involve some form
of WOM
recommendation
- Forrester WOM
recommendations
convert at 3-5x
other channels
- WOMMA

Overview of a Referral Program
Page 17
A referral program is an
end-to-end program to:
• Engage a brand’s
customer advocates
• Foster sharing of
referrals from advocates
• Convert friends into new
customers
• Monitor performance
and optimize results

Folica: Turning Advocates into Marketers
Page 18
GOAL:
• Acquire new customers via
referrals from existing
customers
PROGRAM:
•  Advocate: $10 credit
•  Friend: $10 off first purchase
PROMOTION:
•  Website, Facebook, email,
Twitter & newsletters
INDUSTRY: Retail, Health & Beauty
© 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.

Promoting the Program
19

Advocates Share Over Email
20

Advocates Share via Facebook
21

Advocates Share via Twitter
22

Friends Receive Offer via Sharing Messages
23

The Bottom Line
RESULTS: (After 30 days)
• Advocates………………..6,000+
• Shares per Advocate……4
• Total Shares…………….. 21K
• Email Open Rate………..93%
• Conversion Rate………...16%
24

6 Best Practices for
Referral Marketing Programs
social
referrals
amplify
brand reach

Best Practices for Referral Programs
Page 26 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.

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 donations

1. Creating a Compelling Offer

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 CTA

Page 30
Email Website
Facebook
Post Transaction

Page 31
36%
21%
11%
11%
6%
4%
3%
3%2%2%1%
Homepage
Post-purchase
Newsletter Email
In-Product
Other
Dedicated Email
My Account Page
Dedicated Page
'Drip' Remarketing Email
Header/Footer
Social Media Post
Participation by Promotion Placement

3. Making it Easy for Advocates to Share
•  What to consider
–  Messages: Default or Advocate Created
•  Sharing channels
–  Email
–  PURL
–  Facebook
–  Twitter

•  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 will
receive
–  Include what the advocate gets if the friend
converts

•  PURL (Personal URL) Sharing
–  Personalized links which brands can provide to advocates to share
programs with friends across channels and platforms
–  Simple, flexible, can be used for 1 to1 or 1 to many sharing
–  Less control for brand
–  N/A

•  Facebook Sharing
–  1 to many share with friends
–  Social context
–  Higher amplification than 1 to 1 shares
–  Read like advocate speaking directly
to friends
–  Include rationale for why they are
sharing with friends

•  Twitter Sharing
–  1 to many broadcast share
–  Highest amplification, lowest conversion
–  Condensed message to world at large (140 characters)
–  Use @TwitterHandle for brand to increase SEO
–  Use hashtag (#) for program

4. Personalizing the Friend Experience
Page 38
–  Make it short and to the point
–  Describe the offer
–  Make it personal
–  Keep the CTA simple

4. Personalizing the Friend Experience

5. Keeping the Program Top of Mind
–  Remarketing
–  Advocate Dashboards

5. Keeping the Program Top of Mind:
Remarketing
Page 41
10.5%
increase in
advocates
engaged
14%
of all
advocate
shares
29.5%
of all final
conversions

5. Keeping the Program Top of Mind:
Advocate Dashboard

6. Monitoring and Optimizing the Program
–  Visibility into program funnel
–  Ongoing testing
•  Offer
•  Promotional placements and copy
•  Default sharing messages
•  Remarketing
–  Optimization

6. Measure and Optimizing
Page 44
advocates
shares
referrals
conversions
shares per advocate
clicks per share
conversion rate

6. Monitoring and Optimizing the Program
Page 45
Launch
Referrals grew
From 15 to 3,000
Largest Acquisition
Channel
Optimization Period
Financial Services Example

Expected Results & Case
Studies
social
referrals
amplify
brand reach

The Referral Marketing Funnel
Page 47
advocates
shares
referrals
conversions
shares per advocate
clicks per share
conversion rate

The Referral Marketing Funnel
Page 48
30-50% email
open rates
20-60% of
customers become
advocates
Advocates share
an average 5.4X
3-5X
conversion rate
advocates
shares
referrals
conversions
shares per advocate
clicks per share
conversion rate

Channel Performance
Page 49
Facebook
PURL
Email
Twitter
Email
Facebook
PURL
Twitter
Facebook
PURL
Email
Twitter
Email
Facebook
PURL
Twitter
Clicks per Share by Channel Conversion Rate by Channel
highest in social channels—Twitter
is highest; email is lowest.
Conversion rate is highest in
one-to-one sharing—email is highest;
Twitter is lowest.

Quantifiable Marketing Results
Page 50
30%
Referrals
2.3M
Stories
500K
Revenue$
Entertainment
/ Media
Consumer
Electronics
Online Health
& Beauty
233%
AOV
5000
Customers
433%
Conversions
Financial
Services
Automotive
Online Apparel
Awareness
Referral Rate
Conversion
Rate
Customer
Acquisition
Revenue
Average Order
Value
6
Months
11
Months
30
Days
150
Days
30
Days
45
Days

Women’s Retailer: Boosts Referral Sales 4x
Page 51
GOAL:
•  Drive WOM recommendations to boost
sales and build community
PROGRAM:
•  Original Offer: $10 for advocate, $10
for friend
•  Double Rewards: $20 for advocate,
$20 for friend
RESULTS: (Per Month)
Original Double
•  Advocates………… 10K+…… +33%
•  Share Rate……….. 2.3……… +57%
•  Friend Clicks……… 12K+ …... 3x
•  Sales………………. 1000+….. 4x
Retail:
Apparel

Roku: Driving Sales via Customer Referrals
Page 52
GOAL:
•  Drive new customer acquisition
through word of mouth referrals
PROGRAM:
•  Advocate: free month of Netflix
RESULTS: (After 6 months)
•  Advocates……………….. 40k+
•  Referrals per Month.…… 10k
•  Revenue…..…………….. $250K
•  Customer Referrals…….. +30%
INDUSTRY: Consumer Electronics

Conclusion
•  Word of mouth is a critical marketing channel
•  Referral programs harness the power of brand
advocates to drive new sales and acquisition
•  Best Practices Recap:
1.  Create a Compelling Offer
2.  Promote the Program
3.  Make it Easy for Advocates to Share
4.  Personalize the Friend Experience
5.  Keep the Program Top of Mind
6.  Monitor and Optimize the Program

Q&A
•  Submit all questions via the Questions section of
your GoToWebinar Control Panel and send to either
presenter
Next 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/

| 877 739 8653 | hello@extole.com |
Contact Us
625 2nd Street St. #101
San Francisco, CA 94107
Thank You

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

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

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