Referral Marketing: Powerful Strategies on how to boost App virality
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Referral Marketing: Powerful Strategies on how to boost App virality

In the next few minutes, I’m going to teach
you about the psychology behind word-of-mouth marketing and five of my referral marketing
strategies to boost referrals to grow your business and spread your app like wild fire.
Let’s get into it! Word-of-mouth marketing or referral marketing
is one of the most effective ways of getting new users into your application. Not only
are these acquisitions free, but they also come with a certain degree of social proof
because your friends, your family have recommended this app. And users arrive with pretty much
a very strong intent. So referral marketing or referral is when a user loves your app
so much, they just got to tell the whole world. They’ll bringing their friends, their family,
and they want to spread it around to everyone. And by virtue of of this recommendation, you’re
socially proved, these users come into your channel. They come in for free. And it’s incredibly
useful because referred users are actually some of the highest converting users that
you will get from any channel at all. So it really pays to build these referral mechanisms
and virality into your strategy as well. Why do people actually refer in the first
place? So there are two main reasons but they all comply with, “WIFM,” or, “What’s in it
for me?” We’re all pretty selfish at the end of the day when it come to making decisions
and the rational behind them. So one of the main reasons people might refer your product
to others, it has to be a pretty good product to begin with, but is an emotional reason. Let’s say, for example, that I downloaded
an app, I get great value out of this application. And I want to tell my friends, I want to tell
my family about this app. Really, what I’m doing here is I want to communicate my own
value as a person. And by them getting value out of the app, I really get that value eventually
attributed back to me. When we have Joe that says, “Well, Patrick,
that was a great app. Thanks for recommending that app to me. It’s improved my life. It’s
great utility value. It’s really helped me. That’s actually like an ego massage for me.”
This is pretty the main reason that people create these referrals and why they’re incentivized
to do so is for emotional reasons. And sometimes there is a functional reason
for the referral. But again, there is something in it for the user. It’s less of an egotistical
reason, but functional in that to actually avail of the full product to get access to
extra features. They may need to invite a friend or a colleague into that experience
of using the app to then unlock those extras. To bypass that barrier, functionally, they
most actually refer and bring someone in. But again, they are creating that value for
their friend or colleague, but it’s functional in that they’re removing that barrier and
growing their capacity within the product. There are the two main reasons why people
will refer. And once you understand this, this is something that you can exploit and
something that you can capitalize on. So how do you build referral marketing strategies
into the core, into the heart of what you’re building? How do you create virality into
your strategy? The first step is to build it in. There are
no real cheap tactics that you can tackle in afterwards that are an excuse for not building
virality in the core. So whether you are planning an update to an existing mobile app or whether
you’re planning a new one from scratch, it pays to take the time to sit down and to consider
when they setup the app, are they going to get an opportunity to invite a friend, to
message them, to share a content, or something that brings other people into that experience.
So encouraging them to share the app or to unlock certain sections by virtue of sharing
could then mean you’re bringing more users in. And then by virtue of that, if they want
to unlock certain sections, they have to share it with their friends, and so on and so forth. Well, actually in the next video, we’re going
to be getting into the viral coefficient on how you can apply that to your app. So build
it in. That step one. Create features innately within your app that express these viral and
attributes. Secondly, you could just put in some basic
share buttons and allow people to share the app or even share content within the app.
And that’s pretty good. You will generate some referrals. And by doing that…but the
best way and research shows that you can increase sales by 10% to 20% for existing products
and as much by up to 100% for new products by incentivizing both parties. When it’s a win-win for the person whose giving
the referral and the person that’s actually availing of this new app and downloading it,
you’re going to get a much, much more impactful response. You’re getting value in both sides.
So it’s a win-win, and then win for you as the app marketer. An example of that could be…Dropbox did
this very well. So when you signup for Dropbox, you get an account, but you have to invite
a friend in to use Dropbox as well. If you want to get increased storage. And what was
in it for your friend was, well, they actually got a Dropbox account. Because in the early
days, it was invite only. So they manage to get an account, you got increased storage,
it kept it exclusive. You’re incentivizing both parties. Uber did this as well. Again, in the early
days, with promo codes. So they would give out a code, $5 maybe $10 off your next ride.
And you have to go and share this on social media. Then if this code was actually used,
you got 10 bucks off, and so did your friend. So they’re incentivizing at both ends to make
the most of their virality. If you are doing promo codes, I would encourage
you to use unique codes so that you can track them back to that unique offer and the individual
that completed that referral. Everything should be uniquely tracked. The next step, yes, I’ve talked about this
already, you could include some share buttons. If you’re going to include these, make sure
that you’re bringing in aspects of incentivizing at both sides and include unique tracking
links so that you know what share features within the application and what users are
actually generating referrals for you in your business. A invite-a-friend feature can also be very
effective especially if your app actually needs communication in a network effect in
order to function. So maybe the first time that they download your app, it’s like, “Let’s
go ahead and invite your friends in so you can communicate with them,” or, “Let’s invite
your team or colleagues so that you can start to work with them.” Or you can do this a little
bit later on in the process. But make sure you provide some kind of a capability where
they can enter in the email, and you will do the invite for them with the tracking link
of course. Maybe you would also do a Facebook connect
or a Twitter connect or something like this so they can actually tap their friends, they
can sign in with the social network. They can select their friends they want to invite
and make their lives easy and make it easy for them to invite and bring other people
into your app. Of course, rinse and repeat. Make sure that
you track everything. And as you would, a new user that enters into your funnel as an
acquisition, you’re going to track that through at every stage, right? A full range of pirate
metrics. So referrals should really be no different. So when a user that you paid for,
perhaps through a channel, refer a customer in, even though that customer is coming for
free and the customer acquisition cost is probably zero, that doesn’t mean that you
shouldn’t track through all stages of the funnel because some referral sources will
be better than others. So we need to track referral customers. So what customers that
create the referrals, from what type of referral mechanisms create not only the downloads but
also the activations and ultimately the revenue which one of the most important attributes. That’s it for today, guys, in this video.
Join me next time. We’re going to be discussing the very final video in our mobile metric
series and arguably one of the most important ones, which is revenue. If you’ve any questions
about our video today, don’t be afraid to send us a tweet @PulsateHQ. Leave a comment
below the video as well. It helps inspire the whole community. I’m Patrick Leddy. See
you guys next time.

About Ralph Robinson

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