Lesson: Every business needs to figure out precisely why their customers use their service. What do they want? How does the service help them?
Only when you understand that will you be able to pick the right referral rewards for your business.
So, why a points system for Evernote's referral program?
There are two points very important to grasp with regards to Evernote's business:
Most users are perfectly satisfied with the Evernote's Free version
A substantial percentage of users upgrade to Premium by themselves as long as they use Evernote heavily enough
Cash and/or discounts aren't always the best referral rewards
Giving away cash would definitely net them loads of users, but it might be unnecessarily costly and attract opportunists. (PayPal only got away with it because they were a payments platform, and regular eCommerce companies achieve success by tying the cash rewards to the referred purchase.)
So if Evernote really wanted to give out cash, they could've done that whenever users only successfully referred others to pay for the premium service.
But that doesn't quite fit into the natural Evernote user behavior– people tend to use the free app as long as it served their needs, and upgrade only when they need to– not because somebody sent them cash or discounts!
Premium service (where applicable) is also a great way to reward loyal advocates
So Evernote does something pretty clever with its referral program: it gives users a chance to experience Evernote Premium for free whenever making referrals. If they like it, they'll feel compelled to stick with it– especially if they've already uploaded large files in the interim.
Besides the functional "try-before-your-buy" benefit, there's also a nice "status" effect. Which is kind of like Reddit Gold, or special in-game Mounts for World of Warcraft players who refer their friends?
As a finalist in Esquire's Best Dressed Real Man contest, Samuel is ReferralCandy's fashion eCommerce expert and resident sartorialist. He is obsessed with human behavior, social psychology, and handstands. He is also the lead calisthenics trainer at Weightless.
A referral program is a deliberate, systematic way of getting people to make referrals to your business. Referral programs are often called word-of-mouth marketing, because they reward existing customers for sharing and incentivize new customers to try out your brand.