How to Build a Customer Referral Program?


A referral program, word-of-mouth marketing tactic used to motivate customers to advocate on behalf of your brand. Instead of writing online reviews or submitting customer feedback surveys, use referral programs as these programs will allow customers to share their brand experience with partners as well as friends.


The main agenda or purpose of a referral program is to attract new leads to your eCommerce business. However, you are not just bringing in anyone. Besides that, a referral program makes it easier for your marketing as well as the sales team to engage customers as these leads are good for your business. Along with that, these are familiar with your company as well as its reputation. The referral program is capable of increasing customer experience since they’ve been referred by someone they know. So when a reliable resource tells about your company, a trust factor is built leaving a good impact on your eCommerce business. 

How to create a customer referral program?

  • Begin with customer referral templates

Templates are a tremendous assistance in the process, whether you’re a one-person customer referral machine or part of a multi-person referral team. Furthermore, referral templates customized to match your brand’s voice as well as tone. You can use these free client referral templates to create a bank of referral request emails, referral follow-up emails and even social copy regarding the business’s referral program.

  • Decide your goals 

Before opting for a referral program, eCommerce store owners should consider what they intend to gain from this referral program. Do you want to include retention in the equation? Do you work in a field that demands a great deal of trust-building? Once you decide what your goals are, you can explicitly define them. 

  • Research more and more

Having a good knowledge of the market will help you grow better and faster. Similarly, knowing how referrals are coming to your business can be helpful for your e-commerce business. Assessing where and how recommendations are arriving at your business — or if they’re going to your business at all — is an excellent place to start. This is where you should bring in marketing, sales management, and support — everyone who is responsible for creating customer relationships — to analyze how they’ve dealt with referrals in the past. This way you will get an idea of your current location.

Referred clients have a 16% higher lifetime value compared to non-referred customers. Therefore, doing the arithmetic is worth it to see how much money referrals could bring in and adjust your marketing budget appropriately.

Referral Program

  • Identify ‘Good Fit’ customer for company

Figure out your ideal clientele before urging customers to ask for references. Instead of just entering names to get the program’s reward, your existing customers will suggest leads who buy from your company.

Prominently explanations displayed across client referral programs. When you have a form for customers to fill out, for example, describe what a “good fit” customer is at the right in the start of the form. Attendees are reminded that you’re seeking specific people who require your product, not just a friend who might be interested in your company.

  • List your possible referral sources

We’ll refer to these people as advocates. Someone with whom you’re now linked or have previously been connected to. Hence, start by creating a list of them. Customers, prior customers, not yet closed leads, industry leaders, your vendors, and so on might all be on this list. This will provide you with a firm foundation, to begin with.

Referral Program

The functionality of Referral Program

In the referral program, visitors or customers recommend your items to friends or family members. In return you reward them with a referral bonus in case people suggested by the consumers purchase from your store. Further, a consumer has the option of sharing a product link or a coupon code.

Affiliate and Referral Marketing- are they different?

Affiliate and Referral Marketing do not have big differences. Both of the techniques help e-retailer to promote their brand as well as generate sales by providing incentives to affiliates; the process differs. Furthermore, one feature that makes Affiliate Marketing different from Referral Marketing is that Affiliate marketing focuses on rewarding your existing customers for referring your products to others. Whereas focusinging on rewarding your existing consumers for referring your products to others is what Referral Marketing is.

Knowband offers Affiliate and Referral Marketing modules for different eCommerce platforms. Hence you can install the module depending upon the platform you are using for your eCommerce business.  

Prestashop Affiliate and Referral program addon

Opencart Affiliate Program extension 

Magento 2 Customer Referral Module

Magento Affiliate Program extension

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Ayushi Sharma

Ayushi Sharma

Ayushi Sharma as a writer likes to cater to different genres. She even enjoys doing fashion illustrations and reading books with a cup of coffee.

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