6 Referral Marketing Best Practices to Turn Customers into Word of Mouth Marketers
Oct 19, 2014
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
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Welcome Webinar A0endees
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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
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Panelists
Angela Bandlow VP of Marketing
Extole
Alicia Fiorletta Associate Editor
Retail TouchPoints
MODERATOR
Ashley Futak Senior Marketing Manager
Extole
Overview of Retail Landscape
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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"
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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.
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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
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Iden)fying The Value Of WOM
Source: MarketShare
WOM increases markeBng effecBveness by up to 54%
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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
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Learn From Some Of The Thought Leaders
Bonobos PoWery Barn
What is a Referral Program?
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 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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 © 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
Advocates Share Over Email
20 © 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
Advocates Share via Facebook
21 © 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
Advocates Share via Twitter
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Friends Receive Offer via Sharing Messages
23 © 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
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 © 2013 Extole, Inc. All rights reserved. Proprietary/Confidential.
6 Best Practices for Referral Marketing Programs
social referrals
amplify brand reach
Best Practices for Referral Programs
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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
Page 27 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
1. Creating a Compelling Offer
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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 29 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
2. Promoting the Program
Page 30
Email Website
Post Transaction
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
2. Promoting the Program
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
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
3. Making it Easy for Advocates to Share
• What to consider – Messages: Default or Advocate Created
• Sharing channels
– Email – PURL – Facebook – Twitter
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3. Making it Easy for Advocates to Share
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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 will
receive – Include what the advocate gets if the friend
converts
Page 34 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
3. Making it Easy for Advocates to Share
• 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
• Default Messages – N/A
Page 35 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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 directly to friends
– Include rationale for why they are sharing with friends
Page 36 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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 program
Page 37 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
4. Personalizing the Friend Experience
Page 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.
4. Personalizing the Friend Experience
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5. Keeping the Program Top of Mind
• What to consider
– Remarketing – Advocate Dashboards
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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
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
5. Keeping the Program Top of Mind: Advocate Dashboard
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6. Monitoring and Optimizing the Program
• What to consider
– Visibility into program funnel – Ongoing testing
• Offer
• Promotional placements and copy
• Default sharing messages
• Remarketing – Optimization
Page 43 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
6. Measure and Optimizing
Page 44
advocates
shares
referrals
conversions
shares per advocate
clicks per share
conversion rate
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
6. Monitoring and Optimizing the Program
Page 45
Launch
Referrals grew From 15 to 3,000
Largest Acquisition Channel
Optimization Period
Financial Services Example
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
Channel Performance
Page 49
TMW H I T E P A P E R | A P R I L 2 0 1 2
A 101 Guide To Social Referral Programs
Amplifying Your Brand Reach Via Social Referral Programs
7
Brands can optimize the performance of their social referral programs by testing
and optimizing offers, effectively promoting the program, and testing messaging
by sharing channel.
Sharing Channels
There are a number of ways in which advocates share a referral program with their
friends, including email, personal URL (PURL), Facebook, Twitter, Google+, etc. Shar-
ing, clicks per share and conversion rates vary according to sharing channel. Making
sharing easy, and testing and optimizing messaging according to sharing channel are
important components and directly related to social referral program success.
Clicks/Share
Shares/Advocates
Conversion Rate
Conversions
Social Shares
Friend Clicks
Advocates
PURL
PURL
Clicks/Share
Shares/Advocates
Conversion Rate
Conversions
Social Shares
Friend Clicks
Advocates
PURL
PURL
The Social Referral Funnel
Social referral program effectiveness is measured by:
�� Advocate participation
�� Shares per advocate and number of shares
�� -YPLUK�JSPJRZ��YLMLYYHS�[YHMÄJ���and clicks per share
�� New conversions and conversion rate
Clicks per Share by Channel Conversion Rate by Channel
(TWSPÄJH[PVU��JSPJRZ�WLY�ZOHYL��PZ�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.
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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
© 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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
Page 53 © 2013 Extole, Inc. All rights reserved. PROPRIETARY/CONFIDENTIAL.
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/
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