#ParrotInspires: 5 referral marketing mistakes and how to avoid them

Referral marketing is a great opportunity for new businesses since it is relatively easy to implement and manage. This marketing method is also a great way to increase brand awareness and acquire new customers and their trust. Starting a referral program is fairly simple, but how to maintain a high level of results? Falling into a routine and making mistakes that limit performance is an easy trap to fall into. There are a few game-changing business tips to help avoid these mistakes in your referral marketing strategy, and we continually point them out on the EarlyParrot blog.

So what are those common referral marketing mistakes?

Mistakes are a human thing and everybody makes them, even business owners. There are some common referral marketing mistakes that are made frequently despite many warnings and red flags. However, being aware of these mistakes, it will be much easier to totally avoid them or create a plan B to overcome them.

In this article, we’ve listed the most common referral marketing mistakes that are typical for the industry. We not only point out why they are mistakes, but also show you how to avoid them or reduce their impact after they have occurred. 

The most common referral marketing mistakes 

Successful referral marketing can take a huge burden off the shoulders of your overall marketing strategy as it may generate revenue at low-cost, as well as increase customer loyalty and brand awareness. And that means profit!

Referral marketing mistakes are potholes that you don’t need on your journey. They are often avoidable, but getting in one can cause a lot of unwanted trouble.

So what are the most commonly made referral marketing mistakes that may damage your marketing strategy and brand reputation?

#1 Choosing inadequate referral marketing software

If you don’t find the right tool, your referral marketing efforts may actually be a waste of time. If your referral software is unintuitive or, worse, unable to integrate with the platforms you are already using, it can be hard to get the best out of your referral marketing efforts. How to choose the best software? We can get you started with our recommendation: EarlyParrot. Our tool can be easily integrated with your website as it works with WordPress, Joomla, and Magento. If you run an eCommerce store, EarlyParrot offers a lot of features to jumpstart and grow your business. It allows you to keep your finger on the pulse by tracking your referral networks’ performance. Running an international business? EarlyParrot supports various languages such as English, French, German, Spanish, Greek, and Italian.

You can easily install our tool within 15 minutes and connect it to your current customer base. Additionally, its extensive API allows you to plug your campaign into various platforms that you use on a daily basis. Referral marketing can become a part of your online marketing strategy in a minute!

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If you are worried about creating programs, don’t be! This tool will guide you through the whole process, step by step. There is a checklist you need to cross off before you press “start”, so you can be sure that your referral program will be well-polished before it launches. There is no option that you will launch the program without e.g. chosen incentive. If you are about to expand your email list, you can do this with EarlyParrot too. The process is as easy as installing the software.

What is also great about this tool is that you can customize all client-facing pages without them featuring any EarlyParrot branding. Customization makes your services appear to be more professional and welcoming.

#2 Taking action in a hurry

Rushing is the worst enemy of most marketing tactics and ideas. To fulfill the potential of any marketing strategy, including referrals, you need a well-thought-out plan. To avoid this referral marketing mistake, you need to put your tactics in perspective.

If you are just starting out you may not have many regular customers, so you might think it’s not worth investing in a referral program since there aren’t enough existing clients to recommend your business.

However, even just a few loyal customers making referrals can create a snowball effect that brings many benefits including, more clients, more sold products and buzz around your brand.

There are many approaches you can take. One of them is to rely solely on a referral program, hoping for existing and happy customers to bring new ones. Another method is to employ affiliate marketers who will refer new clients to your business for a commission fee. You can combine both tactics; affiliate marketing plus referrals can give you amazing effects. Linking influencers’ efforts with your own brand ambassadors, who are distinguished clients from your database sound like quality traffic sources.

Whatever you decide, just don’t do it in a rush.

#3 Ignoring testing

To make sure that your digital marketing plan actually works, you need to incorporate testing into your strategy. The story with referral marketing journey is no different: there are countless methods and configurations that you may want to test out.

One of the biggest referral marketing mistakes is to neglect the potential of testing. You can split or A/B test your communication, message, referral reward and CTA, for example, then analyze the results and improve your strategy accordingly.

While the sky’s the limit for testing, here are a few handy ideas you to consider:

  • Check website analytics tools and heatmap generators to identify bottlenecks on your website, elements that draw attention, and parts of your offer/program that might be off-putting.
  • Use email marketing and send a survey to your clients asking them for feedback about your referral program.
  • Test a few versions of your promotional landing pages or campaigns on social media.
  • Identify clients via specific data, such as brand sentiment, in terms of potential brand ambassadors and test their impact/results.

Testing isn’t a one-off activity, it’s a process that needs to be continually repeated. The insights you gain one day may not be relevant the next. Everything evolves!

#4 Not improving the customer experience

The customer experience can be make or break for your referral program. And not caring about constant improvements in this area will only lead to making one of the most crucial referral marketing mistakes. And we’re talking here about both website and mobile optimization.

Some data to back it up? Over half of all people using mobiles to visit websites abandon them if they do not load within 3 seconds. And they may not only end their visit, but they will more than likely never recommend your services further. 

No one will recommend a highly unresponsive site to a friend. Imagine that a potential client visits your site, but it does not open immediately or freezes. In the event of such a scenario, it is understandable that the user may choose to not make a purchase or join a referral program and make a recommendation about it.

What do you need to pay attention to? First of all, what your website must be intuitive and easy-to-use for the client, including the landing page architecture, social media communication, and email content. Even a single, non-working cog of the whole machine may ruin the entire program.

You must define the rules clearly and indicate where your customers can sign up for your referral campaign. The process itself can’t be difficult or users might abandon it halfway through. Don’t ask for too much data at first. Over time, as loyalty builds, you can ask for further information and preferences via surveys.

If you provide an app, the same rules apply. The interface should be intuitive, with no bugs, lagging, or freezes. Also, the opportunity to sign up for your referral marketing program should be properly displayed, perhaps by a pop-up that appears after launching the app. Remember that the app should be available on both iOS and Android, even though the exclusivity of Clubhouse goes against the grain here.

#5 Not including a timeline

At the very beginning of a campaign, you need to determine how long the program will last for. You should also state whether it applies to all products, or only certain limited services, for example. What’s more, referral links should also have a specific validity date, e.g. “share this link with your friends and if they sign up via your referral within 10 days, both of you will receive gift cards”

Do you remember getting sent some countdown offers and time-bound promotional codes? This is how it works: if the time allowed to claim a benefit is limited, you will probably be more encouraged to actually take the desired action.

That’s why you should tell clients how long they have to share their links, invite friends and earn rewards. If there are different rules depending on the number of referrals or time taken (e.g. better rewards in the first 2 weeks) let them know about that too. It’s also important to send reminders at the end of a campaign to clearly indicate how much time is left. Speaking of time, another more crucial issue is that it can take a while to make referrals, encourage others, and confirm purchases. Setting up a promotional timeline helps you eliminate this referral marketing mistake of not informing both your regular and potential customers about how long they have.

Be aware and stop committing these common mistakes

An awareness of existing referral marketing mistakes is half the battle to avoid them. With this knowledge, you can keep your eyes wide open and react quickly.

To run a referral marketing campaign that will succeed, you have to analyze your strategy, determine what you actually want to achieve, calculate the available budget, and set a suitable time period for the promotion. Implementation of all these elements can take some time, but do not give up. If any problems arise, there are always ways to overcome them. Taking a look at this article every time you encounter a bump on the road will support your management with the above tips. Look at your program through the prism of the referral marketing mistakes listed above, and if they apply to your business, you know what to do!