A well-crafted friend offer can turn curious onlookers into loyal customers. When done right, it becomes a powerful conversion tool that can elevate your referral program’s success and boost your sales.
But what makes a great friend offer? Here’s what we’ve learned from the best-performing referral programs.
1. Bigger is better, but keep margins in mind
When it comes to setting a friend offer, the larger the discount, the more compelling the incentive. The goal is to make your offer so attractive that friends can’t resist checking out your products. However, always consider your margins and ensure the discount is one you can comfortably afford.
Pro Tip: If you’re unsure, start with a slightly higher discount than you’re initially comfortable with and track results. If you see a spike in conversions and boost in referral sales, it might be a worthy investment.
2. Make it appealing but profitable
While a generous friend offer can drive more traffic, make sure it doesn’t strain your budget. Calculate a discount rate that’s enticing enough to convert, but won’t put you at a loss. Test different levels of discounts until you find the sweet spot where your profitability and conversion rates meet.
Remember: A strong friend offer should benefit the Advocate who referred them, the referred friend, and your business.
3. Find the balance between incentives
How does your friend offer stack up against the Advocate reward? Striking this balance is crucial for motivating your Advocates to actively share and refer your brand.
For well-known brands, consider giving a larger friend offer compared to the Advocate’s reward. This approach shifts the focus onto providing value to new customers, making it easier for Advocates to make referrals.
For less established brands, a higher Advocate reward can encourage more sharing and referrals. Your Advocates are more likely to promote your brand if they feel they’re getting a great deal themselves.
Pro Tip: Test different ratios to see what resonates best with your audience. You can always tweak it as you gather more data. Learn about your referral report.
4. Add an expiry date
Everyone loves a good deal, but no one wants to miss out. Including an expiry date on your friend offer creates urgency, motivating referred friends to act quickly. Not only does this prevent procrastination, but it also makes the discount feel more exclusive—adding to its perceived value.
Pro Tip: Highlight the deadline clearly in your messaging to create a limited-time-only vibe that drives action. Customize your emails and pages.
5. Not sure where to start? Try a 10% discount
When in doubt, start with a 10% discount as a baseline. It’s a substantial enough offer to catch attention without overwhelming your margins. From there, monitor performance and experiment by adjusting the discount amount. Your referral program is flexible, so don’t hesitate to test, iterate, and refine until you find the perfect formula.
The right friend offer can turn a simple referral into a powerful sales driver. Use these tips to design an offer that’s both enticing and profitable.
Learn about other types of friend offers you can use with ReferralCandy to make your program even more effective.
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