There’s no question that incentives matter when it comes to referral marketing. After all, referral programs are designed to encourage customers and employees to promote a company’s products or services. The only thing better than cash in your pocket? More money. And we don’t mean a salary, either–referral incentives are one of the most important things to consider when running any kind of marketing campaign because they will help promote company products and services!

And while some companies may be hesitant to offer incentives for referrals, the truth is that doing so can pay off in a big way. In fact, research has shown that offering incentives for referrals can lead to a significant increase in the number of referrals received.

What’s better than one referral? How about lots of them! Offering incentives to your employees for referring customers not only builds loyalty but also increases the number in circulation. Research shows that this can lead to an impressive increase over time, with some companies seeing their referrals climb as high as 300%.

So why do incentives matter so much in referral marketing? There are a few key reasons:

1. Incentives Motivate People to Take Action

One of the biggest benefits of offering incentives for referrals is that it can motivate people to take action. When people are given an incentive to refer others to a company, they’re more likely to actually do it.

It’s not enough to simply motivate your staff with carrots anymore. We live in a world of the unlimited potential and it is important for motivating people that they see the future version of themselves as partakers in all things, not just recipients!

A referral incentive can be one way you do this by inspiring others through their successes while also helping assure them on reaching goals because when we know our efforts will lead towards something positive then there are more likely to put forth the maximum effort possible

2. Incentives Encourage People in Referral Marketing

Another benefit of offering incentives for referrals is that it can encourage people to refer more people. If people are given a reason to refer others, they’re likely to do so more often. This, in turn, can lead to even more referrals and even more business for a company. The power of incentives is undeniable. Offering discounts, coupons, or other rewards for referring others can increase your bottom line by encouraging people to refer even more customers than you might think!

3. Incentives Can Help Build Loyalty

In addition to motivating people to take action and encouraging them to refer more people, offering incentives for referrals can also help build loyalty among customers and employees. When people feel like they’re being rewarded for their loyalty, they’re more likely to continue to be loyal to a company.

Offering incentives for referrals is a great way to encourage customers and employees to promote your company. By offering incentives, you can motivate people to take action, encourage them to refer more people, and build loyalty among your customer base.

Offer an incentive that matches the expectations of the program

Referring to friends is a great way to get some benefits, but there are limits on how much you can earn. Make sure that what your friend gets from referring their friend will be worth the effort they’ll have put into registration and waiting for information about whether or not they were lucky enough at winning something! Whether it’s discounts off future orders (such as an extra 20%), or free shipping with no minimum purchase requirement; it could even give access to exclusive opportunities such as live demos & webinars.

Now, don’t make it so good that it will lose you money. A $10 gift card to a referrer’s favorite restaurant is probably going to be more motivating than a $5 one. But a $100 gift card? Not so much. You don’t want to set yourself up for failure by offering an incentive that costs you more than the new customer is worth to you.

Don’t change the rules of your referral marketing plan in the middle of the game

If you’re going to offer an incentive for referrals, make sure you stick to it. Nothing will discourage customers and employees more than changing the rules in the middle of the referral program. Doing so will damage your credibility and make it difficult to encourage people to participate in future programs.

Lastly, do make it something they can easily share with friends. The easier it is for potential referrals to tell their friends about the offer, the more likely they are to do it. So if you’re offering a discount, make sure it’s something that can be easily shared (like a promo code) and not something that requires a lot of explanation (like “10% off your first purchase”).

So what are you waiting for? Get started on your referral program today with a healthy dose of referral incentives! And if you’re looking for more information on how to set up and run an effective referral marketing campaign, be sure to check out our blog for tons of helpful tips.