Word of mouth is a powerful tactic used by a plethora of eCommerce stores to reach a larger audience in the community and primarily to increase their sales. The success of an eCommerce store depends on how much the audience is aware of your store and its benefits. And the easiest way to achieve them is through WOM marketing.
What makes WOM marketing special is that you don’t need to invest your efforts a lot. Your audience will do it for you, all you need is a strategy to encourage Word of mouth. Referral program is one such strategy, by running a Referral program you can skyrocket your Word of mouth and increase your sales rapidly.
In the following sections of this article. We’ll show you “How to Increase Word of Mouth Marketing Using a Referral Program.”
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What is a Referral program?
Referral program is a strategy used by eCommerce stores to acquire new customers through existing customers by turning them into brand advocates. Acquiring new customers is expensive and this is why the Referral program gained its popularity as it helps you get new patrons cost-effectively.
You can offer referral rewards for both the Referrer and the Referral to increase your customer loyalty and influence Word of mouth marketing.
Why do you need a Referral program?
Many eCommerce stores make use of Referral programs for different needs. Some use it to retain their existing customer by offering rewards for every successful referral they bring. New eCommerce stores use Referral programs to acquire new customers at a low cost. So, there are various reasons that differ based on the store. But since we are talking about Word of mouth, do you actually need a Referral program to increase WOM marketing?
Yes, Referral programs influence Word of mouth greatly, because customers trust the words of their peers more than any other trust badges.
We believe these statistics alone are enough to prove that you need a Referral program in your store to increase WOM marketing. But here are a few more,
- Reports say that only 33% of customers trust conventional business ads.
- In retrospect, 90% of customers trust recommendations from fellow customers.
- 82% of customers look for referrals from their friends before they decide to purchase a product from a store.
- 67% of customers are more susceptible to purchase a product from a store that was referred by their friends.
- 92% of customers believe in Word of mouth more than online ads.
These statistics show how crucial a Referral program can be to your eCommerce store.
Alright, now you know that Referral programs genuinely influence word of mouth and here are a few tips to increase it.
Tips to increase WOM marketing using the Referral program
So far we’ve come to a conclusion on how Referral programs are crucial to increase your Word of mouth. Now let’s look at a few tips on how you can increase it.
Offer double sided Referral rewards
A Referral program will be redundant if you don’t incentivize your customers. Rewards act as a catalyst and encourage your customers to spread the word about your store. Offering rewards will give a reason for your customers to spread the word. But make sure to choose the rewards program.
Generally, there are three reward types in a referral program,
One sided Referral reward – Either the Referrer or the Referral gets a reward.
Double sided rewards – Referrer gets a reward after the referral visits the store and completes a purchase. The referral will also get rewarded.
No Referral rewards – Not many eCommerce stores run this type of Referral program where no party concerned gets a reward.
If you want to increase your word of mouth, you must offer Double-sided rewards so that both your referral and referrer get satisfied. This will spark a chain reaction and motivate the new customers to spread the word about your store thus increasing your word of mouth.
Now you may wonder, what rewards do customers expect?
Cash reward, Percentage or fixed discount rewards, free shipping, loyalty points are the most common types of referral rewards offered by eCommerce stores.
A recent study has revealed that customers are more likely to refer their friends if you offer non-cash incentives like Free shipping, discounts and loyalty points.
Reach out to your loyal customers
Are you launching a new product? Are you offering a discount? Are you running a referral program?
Whatever the reason, it is crucial to always reach out to your loyal customers first. Because they are the ones that know your store better than you.
You can ask them for feedback, ask them what changes might look good in your store. And even if you want to increase your Word of mouth through the Referral program, ask them to refer their friends. Your loyal customers are the ones that have traveled with you since inception, they know how your store works. So, they’ll not hesitate a bit to refer their friends to your store.
Another major reason to start out with your loyal customers is that new customers might not know how really credible you are.
So, investing your efforts and targeting your referral program solely towards your loyal customers will help you skyrocket your word of mouth easily.
But always remember to reward them for each referral. Yes, your loyal customers might do it for free, but if you want them to keep referring and increasing your word of mouth then you must offer rewards.
Avoid long Referring process
Alright, you’ve successfully launched your referral program in your store and have reached out to your loyal customers, the work is only half done.
Yes, there is still one crucial thing that stands in between your store and the word of mouth you can get through referrals.
If your referral process takes two or more steps to complete, it’ll frustrate your loyal customers and might push them away from the program.
So, follow what most of the famous eCommerce stores do, ‘One-click referral’. Your customers must be able to refer their friends within a single click, only then will your Word of mouth increase.
Dropbox’s iconic referral program has a one click referral. All the customer has to do is enter their friend’s email address and the link to join will be sent to them. Even if the customers are ready to refer their friends, your long & complex referral process might push them away. So, avoid too much navigation and keep it minimalistic to encourage more referrals and simultaneously increase your Word of mouth.
Dropbox only has email sharing, you can include other social sharing like Facebook, Twitter, etc to double-fold your word of mouth
Automate your Referral program
Referral programs are a complex process and if your goal is to increase your word of mouth through referral programs then you’ve got to automate it. Handling a referral program manually can be a tedious process, customers will be looking for a quick response with the rewards, you cannot achieve that through manual efforts. What you need is a Referral plugin that can help you run an automated referral program in your store. It should be able to track every successful referral and their purchase. This will help you streamline your referral rewards and increase your word of mouth.
Credibility is key
If you want to genuinely increase your word of mouth through referral programs then you have to leverage your credibility.
Sometimes your customers, especially your new customers, might be aware of your history. They might have doubts on your credibility.
Yes, the loyal customers might know who you are but to double your word of mouth you need a referral from your new customers too.
Customers will fear Reputation risk, what if I refer my friends to the store and they end up not liking it, this is what most customers think.
Now it is your responsibility to make sure that their reputation will not be affected because of you, you should assure them.
And the best to give them your assurance is by displaying testimonials reviews on your site.
As we said earlier UGC greatly influences customer’s decisions, so by displaying reviews on your site will encourage your customers to happily refer their friends.
Not only displaying reviews, but there are also many factors that can help you show that you are credible. Make use of all those factors.
Once the customers start trusting your referral program you can effortlessly skyrocket your word of mouth.
Alright, these are some of the simple hacks that you can pull off in your store to increase your Word of mouth exponentially.
Increasing your store’s Word of mouth doesn’t require much of your efforts because your customers will do it for you. All you need is to give them a reason to do that. This is where a Referral program comes into play, through a referral program you can influence your customers to spread the word about your store.
It directly influences Word of mouth and we’ve discussed some of the best tips to improve your referral program and increase your Word of mouth simultaneously.
So, what are you waiting for? Launch a Referral program right away and start increasing your Word of mouth.
Joel is a content writer that loves to think outside the box. He has an immaculate experience on eCommerce platforms and written articles on customer retention strategies, Shopify app, WooCommerce plugins, etc. Joel is also a whizz in motion graphics as he has a great eye for elegance and finesse.