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Best Practices: How to Choose a Referral Reward for Your Store

Last Updated: Mar 29, 2017

The Referral Reward is the reward you give to your Advocates for successfully referring their Friends to the store.

Before you decide on a Referral Reward, it’s important for you know this: there’s no “perfect” reward structure. As you learn more about your Advocates, you can then fine-tune your reward structure to make them more appealing.

Here’s a quick decision-making process to help you choose a Referral Reward:

1) If your Advocates are likely to make repeat purchases, give discounts.

The reasoning is simple: your existing customer is now primed to make another purchase! 

To do this in ReferralCandy:
In the Referral Rewards page, click the “Edit” button for the Referral Reward box, and choose the “Coupon” option. 

How to choose between fixed dollar discounts ($10 off) and percentage discounts (10% off):

Consider the Rule Of 100:

If your product costs more than $100, using cash discount sounds more impressive.

If your product costs less than $100, then a percentage discount sounds more impressive.

2) If your Advocates are unlikely to make repeat purchases, give cash.

If your product is something that your customers are only going to buy once in a long while (a mattress, budgeting software etc.), then giving them discounts on future purchases will simply annoy them. It makes more sense to give them cash instead.

To do this in ReferralCandy:
In the Referral Rewards page, click the “Edit” button for the Referral Reward box, and choose the “Cash” option. 

3) How much discounts or cash should I give?

Again, there is no hard and fast rule about this. Generally, we observe that retailers who give at least 10% in Referral Rewards enjoy higher referral rates.

4) Can I give out custom rewards instead?

Sure you can!

Do note, however, that you will have to manually fulfill the custom rewards (e.g. free teddy bear, gift cards etc.) yourself– ReferralCandy cannot do that for you.

ReferralCandy will inform you each time your Advocate makes a successful referred purchase via email, and you’ll then have to send your reward to the Advocate yourself.

To do this in ReferralCandy:
In the Referral Rewards page, click the “Edit” button for the Referral Reward box, and choose the “Custom” option. 

Find out how to choose a Friend Offer for your store

Still have questions? Contact us.

Have other questions? Contact us.

support@referralcandy.com
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