The Psychology of Referral: Why it matters to your marketing strategy
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Transcript of The Psychology of Referral: Why it matters to your marketing strategy
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The Psychology of Referral:
Why it matters to your marketing strategy
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Our Psychology of Referral series covers:
• What really motivates customers to refer-a-friend?
• The 6 Weapons of Influence key to every successful referral campaign
• How to “nudge” your way to referral success
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PART 1: What motivates customers to refer?
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We were born to be social
“More than features & benefits, we are driven to become a member in good standing of the tribe. We want to be
respected by those we aspire to connect with, we want to know what we ought to do to be part of that circle.”
- SETH GODIN
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Factors impacting likelihood to refer
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We were born to be socialReferrer incentive: Do I really want this?
In order to act as an incentive, a reward has to hit the customer’s sweet spot
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Effort required:How easy will it be to attain the reward?
How many steps, or pieces of data are you asking from your customer in order to sign up?
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Social capital: Will this make me look good?
My friends will love this product/service
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Social risk: How concerned am I that this will be received negatively?
My friends will see this as self-serving - I don’t want to be seen as profiting from them
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Part 1 - Summary
Social capital and social risk play a huge part in likelihood to refer
Read more about how to play on social capital and mitigate social risk
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PART 2: Cialdini’s 6 Weapons of Influence
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Weapon of influence #1: Reciprocation
“We are obligated to give back to others, the form of behavior that they have first given to us. Essentially thou shall not take without giving in return” - Cialdini
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Weapon of influence #2:Commitment and Consistency
When a customer commits to referring your brand, the rule of consistency and commitment suggests that they are more likely to refer again
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Weapon of influence #3: Social Proof
Weapon of influence #3: Social Proof
Use quotes or display the number of other happy customers who’ve taken up your offer so far.
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Weapon of influence #4: Liking
Ensure the referring friend’s name is prominently featured. This will instantly associate their potential purchase with positive feelings toward that person.
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Weapon of influence #5: Authority
An authoritative identity is built by demonstrating professional credentials and expertise.
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Weapon of influence #6: Scarcity
Perceived scarcity can drive action - from restricting how long a new customer has to use an offer to limiting how long a referrer can share that offer
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Part 2: Summary
Cialdini’s 6 Weapons of Influence provide an excellent blueprint for referral campaign conversion optimization
Read more about Cialdini’s Weapons of Influence
For testing ideas to steal: download our guide to AB testing
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PART 3: Nudging Your Wayto Referral Success
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There are many ways of framing an offer; each variation can nudge a prospective customer in a different direction. 20 % off might not be as powerful as £20 off when you spend £100
FRAMINGThe contextualising of a concept or issue can dramatically influence decision-making
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Never underestimate the power of letting people know how many others shared an offer. This reduces feelings of social risk and sets the expectation that signing up is expected
HERD BEHAVIOUR We are easily influenced by what others say and do
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For even more useful insights and tips on how
to make your referral campaigns a success,
check out our complete guide to referral
marketing on our website.