Referral marketing is a wonderful tool to expand exposure, gain more customers, and extend your bottom line. However, while launching it, you may commit some of the crucial referral marketing mistakes. Therefore, to help you out, we have compiled 12 such mistakes that may prevent you from getting the desired results.
So, without any further ado, let’s have a look at referral marketing mistakes one by one.
12 Referral Marketing Mistakes to Avoid
1. Choosing the wrong incentive
A referral program is all about picking a reward or incentive that best suits your brand and fulfills your customer requirements. According to an expert, one of the most common referral marketing mistakes that businesses make is trying to save a few dollars while enticing customers with poor, unrelatable incentives.
Therefore, while choosing what incentive or reward to apply, find something that goes well with brand identity. So, it is recommended to dig deeper into your customer data to understand your most loyal customers and what they care about.
If your loyal customers buy from you weekly or monthly, incentivize them with points credits or discounts for further purchases. But, if your customer base doesn’t buy frequently, think of giving a gift card or exclusive access to a new product. It will allow you to make your customers become advocates for your company.
2. Making it too complicated
Many companies over complicate their customer referral program, thus making it difficult for the customers to participate. So, it is recommended to make your referral program intuitive and simple to follow. For instance, give a clear link to the referral email or website. In addition, offer your consumers easy options to build a network through email and social media and a way to track their progress and get rewards.
Therefore, think about how you want to incentivize. Most referral programs offer incentives to members doing promotions or refer a friend who then makes a purchase. If you ask for too much of a customer, they won’t connect with your program and avoid making any effort. Therefore, consider giving rewards when your user accomplishes smaller things, like obtaining an email address or the phone number for a potential customer.
3. Loss of attention due to lackluster promotions
Grabbing attention is not easy today; thus, knowing what inspires them to act is crucial to becoming brand advocates. Unfortunately, common offers aren’t always adequate to pique a customer’s interest and makes it one of the referral marketing mistakes. So, make sure you use specific incentives for promotions or offers to add urgency to the experience and push your audience to make a referral. Customers react to exclusive offers than an ordinary promotion requiring inclusion and intrinsic value.
4. Lack of awareness about the referral program
One of the most significant referral marketing mistakes is that your customers are unaware of it. Your conversions tend to be low if your customers are unaware of the program or can’t discover where it lives. Therefore, it’s essential to set prominent fields on your website (across various pages), social profiles, email signatures, and apps. Moreover, if the CTA is positioned on your site or simply existing in an email footer, there is less chance for a customer to interact or be face-to-face with the program.
5. Targeting the wrong customers
Most marketers know that all customers are not equal. Referral marketing serves best when you have loyal customers who are already big supporters of your brand. So, have a look at your sales data and social media channels to identify marketing personas who are active and early adopters. You can also consider customer segmentation who would help from a monetary incentive, such as a $50 credit on their next purchase or a percentage of the sale.
Brands that fail to connect with customers will find it challenging to run a referral program. Referral marketing isn’t a substitute for real customer service: these programs are not “set and forget” solutions for designing brand loyalty. However, referral marketing software can help you determine your best participants and test different incentives and channels to boost results.
6. Forgetting to Set a Timeline
After making a lot of effort, still, your program failed to get referrals? If yes, then first you ensure that your audience knows that your referral program exists. Therefore, think of good ways to connect with your audience. For instance, a newsletter is a great way to amplify the word about your referral program – if someone is already on your email list, you count them as support for your business. But, it would be best if you also spread the word on your website, social media channels, and in person.
Second, adding a timeline to your campaign is crucial to create urgency. Make sure you set your rewards to a certain deadline. Deadlines offer customers something to work toward, raising purchase frequency and keeping your brand top of mind. A little urgency can go a long way.
7. Lacking in reaching an audience to make an immediate impact
Reaching out to a broader audience can usually be the most significant factor while determining a referral program’s success. The more people understand the program, the more referrals you will gain and the more sales. While customers act as brand advocates and word-of-mouth can develop your audience, expanding your reach through all communication means is crucial. Make sure you tap the potential of your SMS, email, mobile app, and social channels in a consistent flow to drive campaign awareness and consideration. Also, ensure a clear CTA in every communication mode that directs the audience to the proper destination.
8. Not Tracking Analytics
Many e-commerce sites leverage referral marketing programs but don’t know how it’s going. Like any other form of marketing, referral marketing must be tracked and analyzed. It allows companies to understand and make the necessary corrections to make sure that it’s working properly. With the program’s analytics, a company can recognize different ways to improve its marketing strategy.
Most companies need to know what works for it and what doesn’t. According to Business 2 Community, 32% of B2B marketers have no idea which digital channel makes the most positive impact on revenue, indicating that most companies do not use analytics to measure success. It may prevent businesses from evolving and growing into success by tracking their performance.
9. Not Perfecting UX
User experience (UX) is important to websites, and the same goes for your brand’s referral marketing campaigns. Referral programs should have great UX design as it becomes easy to navigate and simple to use.
Moreover, your referral marketing strategy should consider the following for great UX design:
- The fewer details, the better. People like it straight-up. So, make sure that your referral campaign is to the point. Moreover, once people are comfortable learning more about your referral program, you can ask for more information.
- Make your message clear.
- Make social sharing easy to execute. Since people enjoy sharing things on social media these days, ensure that you have social sharing buttons to share their referrals right away.
10. No Pre- Or Post-Launch Promotions
Your referral program should be present across multiple mediums on the Internet, making promotions before and after launching your referral program easy. Pre-launch means when you prepare your customers for the actual launch, and you can do that by
- Sending an email or newsletter
- Citing the launch in your email signature
- Triggering a countdown to get the fanbase excited
- Reminding and engaging with customers without sounding too pushy and
- Offering amazing perks and incentives
You can also do these things post-launch, even updating customers on how the referral program did at launch.
11. Launching Prematurely
Most marketers commit such referral marketing mistakes when they launch a referral program prematurely, meaning that you are unprepared to handle a flood of referrals from your satisfied fanbase. Or, there are very few people who know about it.
In such cases, pre-launch promotions come handy as people love to get hyped about an upcoming event. Therefore, it’s crucial to plan before hopping to your program launch.
In addition, remember that it takes time to get referrals as customers need time to think about whether to take advantage of your invitation to refer others to your brand.
Most importantly, your referral program has launched prematurely or maybe you haven’t A/B-tested it before launch. If you haven’t A/B-tested your program, then chances are your program may fail.
So, it is recommended that A/B test your program and launch when it’s ready. Also, allow your program time to get traction from willing customers.
Finally, autopiloting your referral marketing strategy is one of the common referral marketing mistakes. While automation has transformed our way of working, it still needs human intervention, which is true for referral marketing.
With referral marketing, you’ll need to keep track of the following tasks:
- Building campaigns
- Reviewing campaigns
- Revisiting campaigns from before, AND
- Rebuilding campaigns that have proven their potential
As you can see, all of these tasks need to be evaluated and accomplished regularly for referral marketing to serve you and your brand.
If you allow your referral program to run on automation, chances are, things can go wrong during its run and cost your company time, money, and resources.
So, ensure that you have a follow-up for evaluating the effectiveness of your referral program. Follow-up assessments permit you to spot any mistakes or inconsistencies and fix them before launch.
Plus, don’t quit at just one assessment. Have continuous assessments aimed at testing and enhancing your referral program. In this way, your program will serve everyone who likes to refer your brand to other people.
To make your referral marketing program successful, you have to make sure that you avoid committing referral marketing mistakes. Therefore, it is recommended to know more about your customers, do A/B testing, do market research, choose suitable incentives, and get more referrals. Try giving your best to avoid the above mistakes, and succeed.