Word-Of-Mouth and Referral Marketing for eCommerce: 8 Tips

Word-Of-Mouth and Referral Marketing for eCommerce: 8 Tips

Anyone who runs a business understands the value of referrals. As opposed to paying for advertising space or working countless hours to generate content and build links, referral marketing can provide you with the very best leads you can get.

It is the payoff for any word-of-mouth your business manages to generate. Word-of-mouth is the most likely to result in a sale, and the return on investment (ROI) in even minor efforts can be immense!

Here are some examples of how great it can be:

  • Word-of-mouth generates at least 5 times greater sales than driving the equivalent volume of traffic via paid ads
  • Referral leads convert better than from other sources, by as much as 30%
  • Not only do they convert better, but they offer an estimated 16% higher lifetime value than all other lead sources  
  • According to various studies, between 23% and 50% of buyers prefer to learn about products and services primarily via word-of-mouth

So what can you do to convert existing customers into brand ambassadors, or even better, rabid fans of your business?

You’ll find that there are a lot of tactics to consider.

How to Boost Word-of-Mouth and Referral Marketing Results in eCommerce

Too many companies leave referral marketing to chance, hoping word-of-mouth benefits come from customers without their involvement.

It’s possible that would work. But why sit around and hope for it when you can be more proactive?

Here are eight different ways to get in front of your own referral marketing strategy from the start.

1.) Build An Official Loyalty and Referral Marketing Program With Tangible Benefits to Referrers

Loyalty programs have traditionally been focused on keeping customers coming back for more. But why stop there?

Some of the most successful loyalty programs in the world are full closed loop. In other words, they don’t just focus on sales and repeat purchases. They also reward behaviors that bring in new customers via word-of-mouth marketing.

For example, you’ve surely seen programs that ask you to share or invite a friend in return for discounts, perks, or other goodies. Many eCommerce referral programs even offer discounts to both parties, the referrer and the new prospect.

Think value add and make it worth both of their time, and you’ll see results with your own program.

2) Make It Easy For People To Participate

Loyalty and referral programs need to not only provide benefits, but they also need to respect people’s time. After all, time is the one nonrenewable resource that everyone seems to lack in modern days.

If you make signup cumbersome, you stand to lose their interest before they can even TRY to help you. Make it easy and quick to maximize effectiveness.

You likely already have some data about buying habits, location, etc. so autofill as much of the data as possible. And only ask for fields that are absolutely required. No one wants to fill out 50 fields on a form to get a 5% discount, which will come only AFTER they invite friends to visit the website later.

You might even want to consider using social logins to speed up the process more. Many companies in a range of industries are moving toward having this as an option, and it can be the fastest way to get people signed up.

3) Capitalize on Existing Customers First

Your most loyal and long-term customers are already your biggest fans. Give them first or early access to the program when you launch it. Show them you care about their business and their loyalty.

Heck, you may already be getting a ton of referrals if you’re running a rock solid operation. Customers who are already talking about you will be elated to have you thank them with perks in a loyalty program.

For long term customers, you may want to give them unique referral links that come with additional benefits like bigger discounts, a personalized referral page, etc.

For the right incentives provided in the right way, you’ll find word-of-mouth marketing can provide a windfall of new potential buyers!

4) Consider Offering a Contest for Active Referrers

In recent years, we have seen some eCommerce companies hold competitions to see who can help grow the subscriber base, boost brand awareness, and increase overall sales volumes.

People love to compete. If you make it easy to understand and offer outstanding prizes, you’ll be able to motivate some subset of your overall loyalty and referral program to take action.

Take time to brainstorm what actions you think will be most likely to help you achieve the goals of the program. Do you want new social media followers? Shares of posts? Email subscribers? New customers? Secondary referrals?

As you can tell, contests can provide a range of possible benefits. Have fun with this one and see what this tactic can offer your own business.

5)  Build Social Media Marketing Into The Program Itself

I’ve alluded to how social media can play a part in various program aspects already, but it’s important to call out the channel itself as a key delivery vehicle for messaging.

Social media can really help boost brand awareness and engagement among customers as well as prospects. Some platforms can still deliver a great deal of exposure with the right messaging. And of course, many companies are also using it for customer service as well.

Social is a powerful tool when used correctly. But stay focused on growing your audience and seeding the idea of sharing / referring forward as you message your followers. And of course, generate value-added content to share with your followers and fans.

When the program is ready, promote it on social media and also be sure to incorporate rewards for helping you grow your presence even further. It should all be a well-integrated program effort across the board.

6)  Always Stay True To Your Promises

This is perhaps the most important piece of this whole puzzle. Customers refer for businesses that they trust.

If you say you will do something, you have to do it. For example, never promise a delivery time that are are unsure you will be able to meet.

The old adage of “underpromise and overdeliver” comes to mind here. That’s what you should always aim to do.

This advice also applies with warranties and money-back guarantees. Be super clear up front about any guarantees or warranties, including eligibility and how to make a claim against either.

If your offering is rock solid, you won’t see too many of these and you should honor them without delay or friction.

Your reputation needs to speak for itself. So always toe the line, stay honest and transparent, and follow through. That’s one of the main ways you can make referral marketing work for your own brand.

7)  Embrace User Generated Content (UGC)

It seems everyone is a content creator these days. People want to create content when they are excited about something.

If they are excited about your products, let them tell the world! They may want to be brand ambassadors on their own, so encourage them to use photos, videos, audio recordings, or written word about their experiences with you and what you sell them.

Video reviews can be the most powerful selling tool you’ll ever see. Maybe even consider adding a user generated content option to any contest or loyalty program you offer.

Oh and don’t forget custom hashtags that can really extend your exposure with UGC as well as any contest posts.

Bottom line: People trust users of a product or buyers from a brand more than the brand itself. By embracing UGC, you’ll be able to benefit from this preference.

8) Be Sure To Highlight Your Referral Marketing Program on Your Domain

You’ll find that some customers will be excited about your program. But they need to know about it before they can sign up.

When you first launch the program, you will want to push it out via email and other channels of course. However, new customers will need to learn about it as well. And your website is the place to make that happen.

Promote and link to more information about the program everywhere you can.

Have a full page or section outlining the benefits, and feature a link to that in a prominent location on the home page as well as any thank you and confirmation pages for after conversions or purchases.

Also include it on landing pages and any on-domain promotional vehicles, such as notifications, pop-ups, etc.


Make it easy to find, easy to sign up, and highly valuable, and you’ll see great success with your loyalty and referral marketing program.

Hopefully some of these tips got your gears turning. Launch your own program to see how much upside referral marketing can provide for you!

Feature Image source under Attribution 2.0 Generic creative commons license from Flickr User Paull Young.

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As Founder and President of Return On Now, Tommy Landry provides the vision behind our SEO and SEM methodologies. With over 25 years of business experience and a deep understanding of modern internet marketing techniques, he spends his time providing hands-on consulting, insightful content, and engaging public speaking appearances to Online Marketers of all skill levels.
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