While big companies like Dropbox and Airbnb found big success with their referral programs, replicating their exact same referral strategy might not work for your small business.
For your particular product offering, you will need to:
Thankfully, there are many different ways to offer a referral program. Some of these include offering discounts, product giveaways, exclusive deals, gift cards, QR code menus, and even cash.
If you're not sure how to implement a referral program that fits your small business, here are some examples that can inspire you. 👇
Referral program tip: If you’re looking to start your own small business referral program, you can do that easily with ReferralCandy. You can also take advantage of our referral program templates here.
A non-toxic cleaning product brand, Branch Basics, has an effective give $10, get $10 referral program, in which both the advocate and the friend are rewarded.
Branch Basics launched its referral program with ReferralCandy and has achieved amazing results with it. Since launching, Branch Basics has generated over $1.5 million in referral sales and a referral rate of 9.75%, which is much higher than the industry average.
In just two years, Branch Basics has generated a 41x return on investment in its referral program.
Another good small business referral program example comes from Toki Mats.
Since launching the referral program, Toki Mats has generated over $500,000 in referral revenue, and the referral rate has been 12.04% in the past 12 months. The referral program has generated a 41x return on investment.
To do this, Toki Mats uses a simple give 15% off and get 10% of your friend’s purchase amount. Toki Mats advertises its referral program on Instagram, Facebook, and through referral emails, which have all proven to work well.
Renogy runs a referral program that offers customers a $20 credit for every successful referral. To advertise the program, Renogy has contacted customers via email and social media.
Renogy launched its referral program with ReferralCandy and has generated close to $300,000 in referral sales in just under 18 months. The referral program achieved a 7.5 ROI for the company and opened an entirely new revenue channel.
A dog treats supplier, Farm Hounds, has a rewards program where you can earn points by doing different things, such as referring a friend, making a purchase, or leaving a review. To advertise the rewards program, Farm Hounds sends referral emails to all new customers-
Customers receive 1000 points for referring a friend, which equates to $20 off their next purchase.
Farm Hounds achieved a 35.30x ROI on the referral program, and the referral rate was 22.25%, which is much higher than the industry average. This resulted in over $600,000 in referral sales.
‍A Box of Stories is a book subscription store that utilizes referral programs to increase word-of-mouth marketing sales.
Launching a referral program for A Box of Stories resulted in over 5,000 customers joining the program, and it generated over 3000% return on investment. Referrals contributed to a total of 3.38% of purchases.
iWader Fishing, a fishing wader producer, offers a 15% commission on every successful referral and referred customers receive 5% off. For every 4th sale per month, you get an extra $100 bonus.Â
No matter your niche, you can implement a similar referral program for your small business as what iWader Fishing has.
iWader Fishing achieved a 2600% ROI on its referral program, and 13% of all revenue came from referrals during its 30-day ReferralCandy free trial.
Activewear brand, Bandier, encourages repeat business through a referral program.
Upon referring their friends, Bandier customers will earn $25 in points when a friend makes the first purchase. The referred friend also gets $25!Â
And it doesn’t just stop there. Referring customers will continue to earn points for any succeeding purchases that their referrals make. What’s not to love about unlimited rewards?
A book publishing company called Scribe Media gets straight to the point and offers commissions ranging from $1,000 to $12,000 for every referral made.
Authors who have already published a book with the company can refer other authors. If they sign up, the referrer gets the money in cash or applied as a credit to their Scribe Writing account. There’s also a third option to donate the referral reward to charity.
With this strategy, Scribe Writing leverages its customers’ network to get more authors to publish with them. After all, like attracts like.
The monetary reward is compelling, and new authors are more likely to trust other authors who have experienced the service and recommend it.
Not many small businesses have the cash to spend on a program like this, so you need a solid strategy to make it worthwhile.
The online sneaker shop Greats rewards advocates and referred friends with $30 in credits when a new customer makes a purchase using the referral link.
Greats markets its brand to millennials, who are known for being socially motivated, generous people.
Giving credits to both parties—not just the referrer—is a great move from a company that understands their customers and how to earn their loyalty.
Referral programs don't have to be complicated. Toy company Riff Raff ran a Facebook referral contest, giving away customized sleep toys to lucky winners.
Contest participants were asked to share via email, Facebook, and Instagram. When a person made five successful referrals, he or she would receive a free customized toy valued at $80.
(NOTE: Riff Raff uses ReferralCandy to run its six-figure sales referral program!)
Plus, parents of young children tended to talk to other parents—to share resources, knowledge, and especially product recommendations and referrals.
Kit (previously ConvertKit) is an email marketing service provider that is popular among bloggers and business influencers. They are also well-known in the email marketing space, regularly publishing helpful content.
As part of its referral program, Kit users can earn an additional 100 subscribers for every successful referral. The referred friend also receives 100 free subscribers!
A curated wardrobe delivery service, Threadbeast entices new subscribers with awesome bonus packages for both referring advocates and referrals. There’s no limit to the number of referrals, which means the referring member will get a free package for every successful referral, forever and ever.
The great thing about this program is that both sides get something for free. It’s a generous move but also a great way to motivate existing customers to bring in a surge of new customers.
Honeylove is a stylish garment producer which launched a referral program to increase word-of-mouth sales.
As part of the referral program, Honeylove offers both the advocate and the friend $20 off. They’ve made it easy for referrals to get their referral link by filling out a form.
Nuki sells smart locks and offers an interesting referral program where they reward customers through exclusive surprise products. This is a great example of a referral program if you don’t want to offer customers cash or store discounts.
Nuki explains on their referral page that if you make one successful referral, you get a mystery product, if you make three referrals, you get a €50 voucher, and a €100 voucher from ten successful referrals.
Vena offers one of the highest referral incentives we've ever seen. For every successful referral, they promise to donate $2000 to the charity of your choice.Â
If you’re a small business owner, you might not be able to donate as much as Vena does. However, even a smaller amount, such as $25 or $50, can entice your customers to recommend your brand to their friends and family.
Birdies have a Give $30, Get $30 referral program, where both the advocate and the referred friend are rewarded. Most of Birdies' products are high-ticket products, which is why they’re able to offer such high referral rewards.
While you might not be able to offer as high rewards as Birdies does, you can take inspiration from their reward structure and their simple yet effective referral landing page.
Last but not least, we have an example from Wing Assistant.
This example isn’t necessarily a referral program, as Wing Assistant runs an affiliate program. However, referral plugins, such as ReferralCandy, can also be used to run affiliate programs, which is why we wanted to show this example.
Plus, Wing Assistant has achieved amazing results, generating over $78,000 in referral sales and having a 27.9x ROI on the affiliate program.
Wing Assistant has a simple affiliate program where they reward customers with $200 for every client who activates a plan with Wing Assistant.
If you still haven’t launched your own referral program for your small business, we have outlined the key steps to doing that here:
1. Get clear about your goals. Define specific outcomes you want from your program, like increasing driving sales or increasing brand awareness. This will determine the approach you should take in creating your referral program.
2. Select your referral program software. ReferralCandy is the best referral program software option for small businesses. It is available in the Shopify App store and as a WordPress referral plugin.
3. Make an outreach plan. Decide how you’ll inform your customers about the referral program - via email, social media, or on-site prompts. With tools such as ReferralCandy, you can set up automatic referral emails to inform customers.
4. Create your referral landing page. Design a simple and engaging landing page that explains the program and motivates existing customers to join.
5. Select your referral incentives. Choose between different referral incentives, such as cash rewards, store discounts, and percentages. Make sure to display the referral incentive clearly on your landing page.
6. Track the referral program performance. Use your referral program software to monitor the performance of your referral program.
7. Manage referral frauds. To prevent hackers from abusing your referral program, manage referral frauds. The best referral program tools, such as ReferralCandy, offer built-in fraud protection.
8. A/B test. Experiment with different messages, incentives, and visuals to see what drives the most referrals.
To summarize the previous examples of small business referral programs, here are the key points that made them successful:
These elements ensure your referral program is accessible, enticing, and widely visible to your audience.
If you want to create a successful referral program, be sure to follow these tips. And, take advantage of ReferralCandy’s 14-day free trial to launch your referral program today!
Hey, I'm Elmeri Palokangas. I'm an e-commerce and online marketing specialist with over five years of experience. My expertise extends to various publications and companies, including WordStream, QuickMail, Scribe, Marketcircle, and Digital.com. When I'm not enjoying a cup of coffee and writing awesome articles, you can find me running in the nearby mountains.
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