Word-of-mouth marketing happens when customers talk about a business product or service to their friends and family. So the current customers implicitly promote the business products by sharing their experience or directly recommending the brand to their network.
Word-of-mouth is one of the most effective marketing strategies (if not the best). According to Neilson Report, 92% of people trust recommendations from friends and family over any other type of advertising.
But there is a problem here?
- Only 29% of customers organically make a referral.
- And relying on organic word-of-mouth and being hopeful that customers will naturally market your brand (even if they’re satisfied) do not work as you expected.
One obvious solution for pushing word-of-mouth is referral marketings. Almost all referral apps work like this: 1. Your existing customer shares a referral link with their friends, 2. If their friend makes a new purchase, then both the referee and referred customers get rewarded (say 10% off). You can find several referral apps on Shopify App Store by simply searching for keywords like Referral.
Why referral should be through a link?
To be trackable: The referral link is a generic link to your shopping website. The URL part of the link (not the content of the website) has been designed and embedded with a code for each customer. So the new purchase from that link is easily trackable.
What is the caveat of using a generic link for the referral?
While using a link for a referral makes the tracking easy, it comes with a crucial caveat: a link to a store website is not convincing enough for the prospective customer to make a new purchase. Just imagine if I send you a link with no description/feedback/review on the store, what is the chance that you go and buy something from that store?
Then, what is the Solution?
- (Product) Review: One solution is to ask customers to share reviews. With a review, the customer literally shares what they have experienced about the product. And that is why people look for reviews before purchasing. But we are missing the advantages of referral solutions: (1) there is no direct recommendation from your trusted guy. (2) there is no reward at least for the review reader, if not the review generator too. So, you can’t directly acquire new customers.
- Influencer marketing: The influencer shares the details of a product rather than just a generic link; which has more impact on the new buyers. Well, of course, it comes with a much bigger pay cut.
What if we can combine all these together? Having a system that is built based on the concept of referral, yet it comes with customization, review generation, and leveraging the power of social media?
One solution for having such a system is to directly ask customers to create content about our brand and share it on social media, in exchange for a discount from the store. In other words, a customer will pick a photo/video, write a review about your product and share it on their social media with all their friends. Here is the pros and cons of this approach:
- Your brand is promoted by customized and more impactful content (compared to a generic link) because your prospective customers will see a recommendation from their friends (trusted person) with true and genuine feedback.
- It is hard to track customers to make sure they have shared a post on social media. (and that is another reason why current referral tools use a generic link for referral: to easily track customers)
- You can only reward your existing customers for their post on social media; yet, with no incentive for the new customers to visit your website and make a purchase (but, in referral tools, they will receive a bonus in their first purchase if they buy through that shared link).
- Customers are busy or lazy. Unless they are desperate about your brand and/or your discount, it’s unlikely that every customer will spend time creating content and share it on social media.
What if we can resolve the above Cons while keeping the Pros?
In other words, how we can efficiently integrate a typical referral solution with social media, influencer marketing, and review generation. That is what we do at Scuti.
Scuti is the first platform that allows every typical customer to promote your products by sharing a CUSTOM post (not a generic link) on their social media, like a (nano/micro) influencer, in exchange for a discount from the store.
A win/win, hassle-free strategy for both sides: businesses & customers.
- A store can create a campaign in less than 1–2 minutes by just deciding on the reward.
- And a customer needs to create a simple post/story about the store and share it on their choice of social media. The only requirement here is to display a discount code (shown in the referral widget) so that their friends can also use it for a new purchase (like a two-sided referral program).
- The platform automatically tracks the customer’s post, validates it, and activates the discount code that can be used by both the current customer and their followers (new customers).
We recently released our Product reviews and referrals for Shopify stores. We offer a one-month free trial with no commitment so you can play with the app. Also, our pricing model allows you to pay a ZERO upfront fee even after the first free month.
Let me know your thoughts.