Referral Marketing: 3 Methods to Acquire New Users
One of the best ways to grow your mobile application is through referral marketing. This is when your customers are incentivized to positively communicate about your app, generating organic buzz and attracting more downloads. Simply put, the customer does the work for you!
There are many benefits of this so-called “word-of-mouth” marketing, and done right, can be a great addition to your overall marketing strategy. Within referral marketing, there are a great many variations and models to select from. Like any marketing strategy, to make it successful for your business, it is important to understand your audience when choosing your strategy.
Below we explore three successful companies employing three different methods of referral marketing to expand their app, and as a result, business presence:
Uber incentives both riders and drivers to migrate to their services from competitors like Lyft by offering cash rewards based on referrals.
Uber has two referral campaigns, the first is aimed at increasing the number of riders and the second is aimed at recruiting more drivers. Incentives differ per campaign. Riders can receive up to a $10 credit subsidized on their first ride using the service. Current users often tell their friends to claim this reward if they haven’t joined yet, especially if they are getting a ride together. To encourage rider recruitment from drivers, drivers can earn up to $20 for referring new riders.
Drivers on the other hand can earn up to $100 for referring new drivers. In an effort to recruit more qualified drivers, when current Uber drivers refer new drivers with prior ride-sharing experience (such as previously working for competitors), the compensation then increases to $500.
Evernote implemented a referral marketing program based on a point system. The first 3 referrals earn you 10 points, enough for 3 months of Evernote Premium. This incentivizes more than one referral and keeps users engaged. The benefits and points offered increase based on your referrals’ actions. If your referrals purchase the Evernote Premium edition, you will earn an additional 5 points. In addition to Evernote Premium, Evernote allows you to redeem your accumulated points for a boost in your monthly upload limit, VIP tickets to Evernote conferences and exclusive visits to Evernote headquarters.
Dropbox’s referral marketing strategy incentivizes new subscriptions through free cloud storage.
Each friend referred to Dropbox yields a certain amount of free storage for Basic accounts as well as Pro subscribers. Basic accounts are free and Pro subscribers pay a monthly or yearly fee so the Pro users get an increased reward. By offering greater cloud storage rewards to paid accounts compared to basic free accounts, Dropbox incentivizes subscribers to sign up for a paid account and refer additional individuals.
The referral process is exceptionally easy. Dropbox provides invitations to send to friends, complete with a referral page. The referral page has a unique link that invitees can use to sign up.
There are a great many choices when it comes to choosing a referral structure that’s right for your app. The above examples are just a peek into the many opportunities and avenues available. Determining what is important to your target audience is the best way to determine how you should be structuring your referral-marketing program. Regardless of the direction and incentives you choose, it is important to remember each incentive approach is as unique as your app – it’s never a one size fits all.
Back to Resources