Word-of-Mouth and Referral Marketing Blog

Referral Marketing Statistics

referral-marketing-statistics

Referral marketing helps to build awareness.

  • 80% of all B2C and B2B purchases involved some form of WOM recommendation during the purchase cycle. – Forrester
  • 49% of U.S. consumers say friends and family are their top sources of brand awareness Jack Morton
  • 65% of social media users learn about brands, products and services through social networks. 70% of users hear about their friends’ and colleagues’ experiences using those products and services. Nielsen, Social Media Report 2012
  • 65% of New Business Comes From Referrals Referrals Other The New York Times

Referrals are more trusted than any other form of marketing.

  • 70% of U.S. consumers say they trust brand and product recommends from friends and family. Only 15% of consumers say they trust posts created and shared by brands by companies on their social accounts. – Forrester Research, “How To Build Your Brand with Branded Content”
  • People Are 4x More Likely to Buy When Recommended By a Friend – Nielsen
  • 92% of consumers trust recommendations from friends, only 33% trust online ads – Nielsen
  • WOM recommendations convert 3-5x higher compared to other channels – WOMMA
  • 84% of consumers trust recommendations from their friends – Nielsen, “Global Trust in Advertising and Brand Messages”
  • People trust recommendations from friends 7X more than traditional advertising – Nielsen

Incentives

  • Retailers find the most effective incentives for social communication to be: A discount code or coupon for “Liking” or Following a brand (35%), Access to limited-time offers for sharing social content (35%), Discounts on ecommerce purchases for referring friends and family (20%) – 2013 Social Commerce Imperatives Survey, RetailTouchPoints
  • Offering a reward increases referral likelihood, but the size of the reward does not matter – American Marketing Association
  • 39% of respondents say monetary or material incentives such as discounts, free swag or gift cards greatly increase their chances of referring a brand. –  Software Advice
  • More than 50% of people say they’re likely to give a referral if offered a direct incentive, social recognition or access to an exclusive loyalty program. –  Software Advice

Activation

85% of fans of brands on Facebook recommend brands to others – Syncapse

Quality

Referral marketing generates customers who have higher lifetime values, are more loyal, and contribute higher margins per year than other customers AMA

Conversion

  • WOM increases markeing effectiveness by up to 54%  – MarketShare
  • 83% of clients are comfortable providing a referral. But only 29% provided a referral. – Texas Tech
  • 65% of New Business Comes From Referrals – The New York Times
  • WOM recommendations convert 3-5x higher compared to other channels –WOMMA
  • Nothing accelerates a purchase decision faster than a word-of-mouth endorsement from a peer whose only agenda is to help – Gartner
  • Referral marketing generates customers who have higher lifetime values, are more loyal, and contribute higher margins per year than other customers – AMA
  • The average small business gets 60% of its business from referral campaigns – Kissmetrics
  • Eighty-two percent of small business owners have said their main source of new business is referrals. – Joel Hughes SVP, Constant Contact

Further reading:

Visakan Veerasamy

Visa is ReferralCandy's Blog Editor. He also co-founded Statement.sg, a fashion ecommerce label selling witty t-shirts. He's been thrice named a Top Writer on Quora. He hopes to enjoy a glass of whiskey onboard a commercial space flight someday.

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