Having their reward in the form of points instead of a discount will then motivate them to perform other earning activities to increase that points balance, which in turn should help their next purchase be even larger than if it had been the original plain discount.Ī referral customer rewards program that benefits the sender and the receiver is the best way to use referrals to generate new, low cost-per-acquisition sales for your business, all without having to spend as much on the increasingly expensive acquisition through ads. Their reward should be in the form of loyalty points, not a straight discountĪdding these two changes will incentivize your customers to make referrals, since there is now a benefit to them and not just to their friends.

The referring advocate who is sending the referral should also be given a reward in exchange for telling their friend.Two additional features you should add to your referral program to make it a success are: Referred customer gets a discount on their next purchaseĪt a bare minimum, that is all that is technically required to create a referral program, but unless you add some modifications to it, it is unlikely to deliver the results you (or your customers) are looking for.Customer is sends a friend a referral to your store.Referral customer reward programs are among the simplest of programs you can set up for a modern ecommerce business. Here are some examples and how you can use them for your business. From the early “buy 3 get one free” style punch-card programs, all the way to the multi-tiered VIP, and everything in between, you can use customer loyalty programs to increase engagement, brand recall, and purchase frequency from your customer base.ĭepending on your brand, your customers, and your industry, different types of reward programs may work better than others. Customer reward programs are the point-based programs loyalty programs designed to increase customer engagement and purchases in exchange for discounts and other benefits.Ĭustomer loyalty programs have been around for hundreds of years.

Loyalty program explained