Top 10 referral marketing statistics for 2025 [+ actionable insights for your program]

Discover the latest referral marketing statistics shaping 2025. Learn how to use these insights to design programs that drive growth, loyalty, and customer engagement.

Two individuals in an office setting with one person standing and the other sitting at a desk.
Wafiqa Abbas
Wafiqa Abbas
Content Marketing Manager
Read time: 17 mins

Remember the last time you picked a restaurant because your best friend raved about it? Or bought a gadget because of glowing online reviews? You’re not alone—nine in ten consumers say recommendations and reviews are important in their purchasing decisions. 

The shift towards reviews and recommendations is reshaping how brands connect with consumers. Ads are losing their edge, while word-of-mouth, recommendations, and reviews are taking the spotlight. 

In 2025, savvy brands will tap into referral marketing to drive growth and loyalty—nothing beats a trusted recommendation.

Ready to see how your brand can tap into this trend? Here are ten surprising stats that will take your referral program to the next level in 2025. 

Key takeaways from this blog
  • Double-sided referral programs dominate: Over 78 percent of programs reward both the referrer and the referred, creating a win-win dynamic that encourages participation.
  • Consumers value meaningful rewards: Shoppers expect at least $21 or an 11 percent discount—most programs fall short, offering just $10 in store credit. Aligning rewards with consumer expectations is crucial to boosting engagement.
  • Interactive and flexible designs matter: Features such as leaderboards, tiered rewards, and points exchanges encourage participation by keeping referral programs engaging and personalized.
  • Awareness is a growth opportunity: 60 percent of non-participants in referral programs have never received a referral link or code. This stat signals the need for brands to better educate and promote their programs.
  • Tailor programs to your audiences’ needs: B2C brands benefit from quick purchase-driven rewards, while B2B brands thrive with multi-objective programs that reward milestones along the buyer’s journey.

1. A notable 86% of consumers said recommendations and reviews are important in their purchase decisions

Only two percent of consumers consider traditional ads important––the majority lean on recommendations and reviews when making purchase decisions. Why? Because recommendations come from real people—friends, family, or online reviewers—who’ve used the product. 

Venn diagram showing 86% value recommendations vs 2% value ads.

Source: Customer referral marketing research: A consumer perspective

Shoppers get insider details that no flashy ad can deliver. When deciding whether a product is worth your money, who would you trust more—a friend raving about it or the brand itself? This is why referral marketing works.

A recommendation and customer review fill in gaps and give buyers a first-hand experience from a trusted source. 

Use the know, like, trust (KLT) factor to your advantage

Here’s the secret sauce––the KLT factor. Consumers are far more likely to buy from someone they know, like, and trust. Think friends, family, or a favorite influencer. 

Brands can tap into the KLT factor by:

  • Building trust: Ensure your customers love your products before encouraging them to recommend them. Happy customers make the best advocates.
  • Using social proof: Showcase genuine customer reviews and success stories that validate product claims.
  • Incentivizing referrals: Offer enticing rewards that motivate your customers to spread the word.

The numbers show how valuable referral marketing is

What does this mean for your brand? Ads might catch attention, but recommendations close the deal. People crave authenticity, and referrals bridge the gap between interest and action.

Person in yellow sweater beside a quote about millennials valuing referrals.

Source: Customer referral marketing research: A consumer perspective

Hot takeaway: Instead of pouring all your resources into traditional ads, consider shifting some budget toward generating social proof. Recommendations and reviews validate and amplify ads, providing the trust factor shoppers need to make confident decisions. A trusted and independent source complements advertising by giving brands unique access to the KLT factor.

2. Over 4 in 5 consumers learn about new brands during conversations

Whether it’s a casual chat with a friend or a glowing recommendation in a group chat, personal endorsements hold unmatched sway in influencing purchase decisions.

There’s a flip side to this power––over half of consumers admit that negative feedback from someone they trust has steered them toward an alternative brand. One bad experience, amplified through conversations, can ripple through potential customer networks, costing valuable opportunities.

Graphic stating "Over 50% of consumers say negative reviews from others push them towards finding alternative brands."

Source: Customer referral marketing research: A consumer perspective

The key to creating positive buzz

To tap into the power of word-of-mouth, brands need to focus on two critical areas:

  • Offer consistent quality  Your products and services should exceed expectations, so customers naturally want to share their great experiences. When customers rave about your brand, they become its most effective marketers.
  • Actively seek feedback. Don’t wait for issues to surface publicly—proactively ask customers for input. Use surveys, reviews, or personal outreach to uncover areas for improvement. 

Conversations about your brand can build it up or break it down.  Turn casual mentions into enthusiastic endorsements by delivering excellence and listening to your customers. When your brand comes up in conversation, you want it to spark curiosity, excitement, and trust—not hesitation.

Hot takeaway: Treat every interaction as an opportunity to make a lasting impression. Happy customers talk, and their conversations introduce your brand to entirely new audiences.

3. Over 78% of referral programs are double-sided

Double-sided referral programs are dominating the scene with 78% of brands using this approach. These programs reward both the referrer and the referred person, creating a win-win scenario that motivates participation on both ends.

This approach works—65 percent of referrers prefer to share rewards. It’s simple psychology––people feel more inclined to refer a brand when their friend benefits, too. This dynamic not only drives loyalty but also builds goodwill for your brand.

Infographic showing 65% prefer shared rewards for referrals on a coral circle background.

Source: Customer referral marketing research: A consumer perspective

Why double-sided wins

While double-sided programs may require a larger budget than single-sided ones, they offer significant advantages:

  • Fosters loyalty on both sides. New customers feel valued right from the start, while existing customers enjoy the perks of sharing something they love.
  • Encourages word-of-mouth. When both parties benefit, referrals feel less transactional and more like genuine recommendations.
  • Creates a level playing field. Offering equal rewards shows that your brand equally values new and existing customers.

Brands that go double-sided often find the added investment pays off in loyalty, advocacy, and overall marketing success. This tactic makes everyone feel valued, encourages participation, and sets your program apart from less rewarding alternatives.

Hot takeaway:  If your budget allows, invest in a double-sided referral program. This strategy pays dividends in customer satisfaction, trust, and long-term growth.

4. 96% of single-sided programs reward the referrer

Single-sided referral programs focus on rewarding one party—usually the referrer—for bringing new customers to your brand. 

Pro vs. con of single-sided programs:

Image of a pros and cons list highlighting one pro (easy to implement/manage, cost-effective) and one con (unrewarded parties lack incentive).

Source: The state of referral marketing report 2024

This strategy is a simple and budget-friendly approach, so it’s a popular choice among many brands.

Rewarding the referrer makes sense. They’re already fans of your product, and incentives encourage them to share it with others. 

However, research by Rachel Gershon, referral marketing expert and Assistant Professor of Marketing at the Rady School of Management, reveals why rewarding the new customer makes more sense. 

Text quote on incentives in marketing by Rachel Gershon, Assistant Professor of Marketing.

Source: Turn loyal customers into revenue-generating advocates with referral marketing

Why reward the recipient?

While referrers don’t need convincing, referred customers often do. 

Offering them a reward helps:

  • Make decisions easier: Offer discounts or free trials to help customers take the first step with your product.
  • Increase conversions: A well-placed reward shows goodwill, turning curiosity into commitment.

When budget is tight

If a double-sided program isn’t doable, rewarding one side can still deliver results. However, prioritizing the referred customer might improve conversions and give your program an edge.

Hot takeaway: If a double-sided program isn’t feasible, rewarding the referred person is the next best thing. 

5. Only 20% of brands use a tiered reward system

A tiered refer-a-friend program offers participants multiple ways to earn rewards, typically escalating the value of rewards based on the number of referrals or actions completed. 

For example, a referrer might earn a small discount for their first referral, a larger one for their second, and a premium reward—like a gift card or exclusive access—once they’ve reached a higher milestone.

Graphic with text "20% of programs use a tiered referral structure" and "3 is the most common amount of tiers."

Source: The state of referral marketing report 2024

By offering reward variety, tiered programs cater to different audiences and their needs, making referrals more appealing and increasing chances of success.

Why tiered programs work

  • Flexibility: Participants can choose rewards that resonate with them, whether it’s discounts, freebies, or exclusive perks.
  • Encourages engagement: Customers are motivated to continue referring to unlock higher-tier rewards.
  • Boosts ROI: A well-designed tiered program ensures the reward value aligns with efforts, helping brands get the most out of their referral strategy.

Example of a tiered program

Moo’s tiered referral program rewards customers based on the type of customers they refer. When customers refer a friend, they receive a $20 reward. But if they refer a customer to the business package, the original customer receives $150. 

Digital flyer displaying two referral programs: "Refer a Friend" for $20 and "Refer a Business" for $150, with service benefits listed.

The progressive setup incentivizes referrers to stay engaged and gives them rewards they genuinely value.

Experiment and adapt

Designing a successful tiered program requires strategy, but the potential payoff can be well worth the effort. Brands can adjust tiers or pivot to a simpler model if results don’t meet expectations.

Hot takeaway: Tiered programs are a powerful tool for driving engagement and loyalty. Brands should test them to see if they align with their goals, keeping flexibility at the heart of the strategy.

6. 62% of programs use a purchase by the referred to define conversions

A conversion event marks the moment when a referral is deemed successful. Most brands (62%) use a purchase event, where the referred customer completes a purchase, to define conversions. Other brands track custom events, such as app downloads or free trial sign-ups. 

Purchase events work well for B2C brands because the sales cycle is typically short, and customers make quicker decisions. For example, if a friend refers someone to a fashion retailer, that person might purchase within hours or days.

However, B2B brands face different challenges. With longer sales cycles and more decision-makers, relying solely on purchase events as a conversion metric may disengage participants. If rewards are only tied to the final sale, participants might lose interest long before a deal is closed. For these reasons, B2B brands would be able to achieve greater and multiple goals by rewarding custom events. 

An infographic explaining two types of referral events: purchase and custom events, with examples from Casper and Dropbox.

Source: The state of referral marketing report 2024

Why a multi-objective program works

Unlike traditional refer-a-friend programs, which only reward purchases, a multi-objective program introduces smaller milestones throughout the buyer’s journey. Advocates and new customers are incentivized at various stages. 

Here’s why it works: 

  • Keeps participants engaged: The program sustains interest over time by rewarding early actions, such as signing up for a newsletter or booking a demo.
  • Fits B2B sales cycles: B2B buyers take longer to commit, and incremental rewards reflect this process, increasing the likelihood of conversions.
  • Works for B2C: Smaller rewards for early actions can still drive faster conversions and greater participation.
Infographic showing benefits: Increased engagement, shorter sales cycle, better relationships, conversion, retention.

Example of a multi-objective program

Take this example from Teach Moreland’s referral program:

  • Referred person signs up for an email list → Referrer earns 10 points.
  • Referred person completes a product demo → Referrer gets $10 credit.
  • Referred person makes a purchase → Referrer earns $50, and the referred person receives a 10 percent discount.
Advertisement for Moreland University's referral program with benefits listed and person using laptop.

By breaking the journey into milestones, referrers and referred customers stay motivated, and brands benefit from consistent engagement throughout the process.

Hot takeaway: Multi-objective programs are a smart solution for businesses with longer or more complex sales cycles. They create multiple opportunities to reward participants, keeping interest alive and increasing sales. Brands should consider testing this approach, especially if one-time reward systems aren’t delivering desired results.

7. Top 3 reward types that brands use: store credit, percentage discount, and gift cards

When it comes to referral programs, the most common rewards offered by brands are:

  1. Store credit
  2. Percentage discounts
  3. Third-party gift cards
Bar chart showing reward types used by brands, with store credit being the most common.

Source: The state of referral marketing report 2024

These rewards are effective but might not always align with what consumers prefer. Surveys reveal that customers rank their top three choices as:

  1. Cash
  2. Free products
  3. Third-party gift cards
Bar chart showing consumer preferences for referral rewards, with cash being the most preferred at 58%.

Source: Customer referral marketing research: A consumer perspective

Breaking down the top 3 reward types

1. Store credit 

Store credit rewards are simple and clear to communicate. When a referrer and the referred person each receive a specific credit amount, such as $10, there is no ambiguity or confusion. Customers perceive store credit as a tangible and immediate value, like cash. It represents a direct reduction in the amount they need to spend, effectively lowering their out-of-pocket expenses. Instant discounts create a strong incentive to continue engaging with the company’s products or services.

2. Percentage discount 

A percentage discount works particularly well if purchase amounts vary widely. They grow and shrink with the purchase amount, keeping rewards balanced across all price points. A percentage discount also drives larger purchases. If your goal is to incentivize customers to spend more, a percentage discount motivates customers to increase their order value to maximize savings. 

3. Gift cards 

Gift cards in this context refer to third-party gift cards for brands such as Amazon, Starbucks, iTunes, or Visa, not gift cards for your brand. These work well when current customers most likely won’t be making repeat purchases in the near future. This incentive gives users the flexibility to choose their favorite reward.

A chart comparing other reward types, pros, and cons for marketing strategies.

Source: The state of referral marketing report 2024

Bridging the gap between customer needs and business goals

While brands can align rewards with consumer preferences, the choice of reward also depends on the industry. 

For instance:

  • Free products: Ideal for ecommerce or consumable goods but not practical for SaaS brands. Instead, a limited trial offer or additional service features might excite potential SaaS customers.
  • Third-party gift cards: While popular, these rewards carry a downside. They direct spending outside your brand, reducing opportunities for additional engagement. Brands should carefully consider whether gift cards support their overall strategy.

Tailoring rewards

The key is to balance what customers want with what makes sense for your business. Matching rewards to your audience’s desires while staying true to your brand’s offerings can maximize engagement and conversions.

Hot takeaway: Test different reward types that motivate your customers while supporting your business goals, from straightforward cash back to creative industry-specific perks.

8. 44% of consumers participate in referral programs, while 56% don’t

Refer-a-friend programs are a win-win for brands and customers, yet only 44 percent of consumers participate. The remaining 56 percent shy away for two main reasons:

  1. Fear of annoying friends: Many consumers worry they’ll come across as pushy or bothersome by sharing referral links too often.
  2. Lack of awareness: Surprisingly, 60 percent of non-participants say they’ve never received a referral code or link from someone they know.
Circle infographic stating "44% of consumers take part in referral programs" on a coral background.

Source: Customer referral marketing research: A consumer perspective

Unlocking the potential of referral programs to reach the right people

These stats highlight a big opportunity for brands to increase participation by addressing misconceptions and raising awareness. A strong education strategy can help consumers see referral programs as a simple and rewarding way to share products they love—instead of an inconvenience.

Start with an explainer

To boost engagement:

  • Create an explainer page: Walk consumers through how your program works, including how to share links and what rewards they can earn.
  • Promote referral opportunities: Use emails, social media, and in-app notifications to keep your program top-of-mind.
  • Encourage organic sharing: Emphasize that sharing referral links doesn’t have to feel salesy—it’s about sharing something valuable with people they care about.

Nintendo’s explainer page for its rewards program features a visual summary of the reward collection and redemption process, including a video that walks users through the details.

Flyer for a rewards program detailing ways to earn and redeem points with graphics of coins and items.

Hot takeaway: Educating your audience is key to increasing participation. Clearly showcase the benefits and make the program user-friendly. 

9. A leaderboard structure would motivate 62% of consumers to increase their participation

Consumers want great rewards, but they also want well-designed and engaging refer-friend programs. 62 percent of consumers say a leaderboard structure, where participants can see how they rank against others, would encourage them to refer more.

What else do shoppers want?

  • Flat rewards fees: A simple, consistent reward appeals to 54 percent of shoppers, making participation straightforward and predictable.
  • Increasing rewards: On the other hand, 35 percent of shoppers are motivated when rewards grow with each referral, adding an extra layer of excitement.
  • Rewards exchanges: Allowing participants to trade points for rewards of their choice adds flexibility and incentivizes them to collect more points by referring friends.
Person in yellow holding a phone with a graphic stating 62% of shoppers engage more with referral programs due to leaderboards.

Source: Customer referral marketing research: A consumer perspective

Make it interactive

Adding interactive features like point-trading systems keeps programs fresh and fun. These elements create a sense of competition and personalization—key to keeping participants engaged over time.

Hot takeaway: Brands should design an easy-to-use and find program. Interactive elements like a leaderboard and rewards exchanges are a good way to attract more referrers. Brands should gather consumer feedback to determine what designs will entice them to participate.

10. Most consumers expect a reward value of at least $21 or 11% discount

When it comes to refer-a-friend programs, consumers have clear expectations––they want rewards that feel worth their time and effort. For monetary rewards, they expect at least $21 in value, yet research shows that the most common store credit offered is $10—far below what motivates most participants.

Infographic comparing expected reward values ($21-$40) with typical values ($10).

Source: Customer referral marketing research: A consumer perspective

Retailers are exceeding customer discount expectations, offering 20 percent off compared to the 11 percent minimum shoppers seek.

Survey results on discount preferences for a referral program, with majority favoring 21-30% and 31-40%.

Source: Customer referral marketing research: A consumer perspective

Consumers’ biggest frustration with referral programs

The top complaint among consumers is low rewards. Many feel they don’t receive enough to make referring worthwhile. Referrers and potential customers will likely disengage if the perceived effort outweighs the reward.

Finding the right reward balance

For brands with limited budgets, offering higher rewards can feel daunting. This is where the rule of 100 comes in:

  • If the product price is below $100, use percentage-based discounts (e.g., 20 percent).
  • If the product price is above $100, use dollar-based rewards (e.g., $25).

This approach ensures the reward feels substantial while staying manageable for the brand.

Hot takeaway: High-value rewards matter. To entice referrals, brands should aim for rewards that align with consumer expectations. Apply the Rule of 100 to help strike the perfect balance between offering meaningful incentives and protecting the bottom line.

Implement these referral strategies for exponential growth in 2025

Referral marketing is a powerful tool for turning customers into advocates, but its success depends on thoughtful design and meaningful rewards. Offering incentives that resonate with consumers, like cash or flexible rewards, makes a significant impact. 

Additionally, keeping your program simple, engaging, and easy to understand drives program participation. Start small, test new approaches, and watch your customer base grow organically.

Ready to level up your referral program in 2025? Sign-up for a free demo of impact.com/advocate 

Want to learn more about how customer referral and loyalty strategies can grow your business?  Check out these resources:

FAQs: 

What are the top statistics for referral marketing in 2025?

In 2025, the top statistics for referral marketing include:

  • Over 78 percent of consumer referral programs are double-sided
  • 54 percent of programs offer the same reward to the referrer and the referred person
  • 86 percent of consumers say recommendations and reviews are important in their purchase decisions, while only 2 percent consider traditional ads important in their purchase decisions.
  • Over 4 in 5 consumers learn about new brands during conversations.
  • 44 percent of consumers participate in customer referral programs, and most do so to earn incentives or rewards.

How important of a role will referral marketing play in 2025?

Word-of-mouth drives product discovery, with 84 percent of consumers finding new items through conversations while only 2 percent rely on traditional advertising, demonstrating referrals’ crucial role in marketing.

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