Referral marketing is one of the easiest ways for businesses to grow their customer base. It has been in existence for a long time but people know it as “word of mouth.”

When a buyer likes your product and recommends it to a friend, there is a high chance that the friend would also buy from you. Nielsen reports that 92% of consumers trust recommendations from friends and family more than traditional advertising.

But if you’ve run any referral marketing programs, you would agree that the process can be time-consuming and difficult especially when you have to do everything manually. From promoting your program to tracking referrals and sales and sending out rewards.

This is why you need to automate your referral marketing to make the entire process seamless and more scalable.

What is referral marketing automation?

Automation is using software to get things done faster. Referral marketing automation allows you to automate the entire referral marketing process.

Referral marketing automation makes it easy to grow your business by eliminating or fast-tracking routine tasks related to referral programs.

After an initial setup, automation allows your referral program to run instantly once certain conditions are met.

For instance, you can easily monitor when a customer joins your program and refers another customer, and automatically distribute the rewards to them after every successful sale. This way, you can focus on what is important and scale your business.

Another thing that automation helps you achieve is tracking all the data points in each referral and making informed decisions about the future.

Therefore, it is important to choose the right automation tools that will make your entire referral process easy and scalable.

Why should you use referral marketing automation?

Great products don’t sell themselves. In fact, 83% of customers say they are willing to refer products and services to others after a positive experience – yet only 29% ultimately do. (Forbes)

Don’t let potential referrals, that could lead to business, fall between the cracks.

People trust their friends more than your business and referral marketing helps you attract customers who are more loyal and profitable.

However, managing referral marketing on a large scale is difficult which is why you need automation to help you get started quickly. That way you can focus on other important aspects of your business.

Here are more reasons why you should automate your referral marketing program:

1. Gain loyal customers

When you automate the manual process of enrolling, tracking, and distributing rewards to referrals, you can quickly scale your business and allow your existing customers to grow your brand.

As a result, you will have lower customer acquisition costs and customers with a 16% higher lifetime value. (Research Gate)

2. Monitor sales actions in real-time

Another benefit of using referral marketing automation is getting access to analytics that give you better insights into your customer's behavior.

If you choose Gameball, you can monitor all your referral campaigns from one dashboard and use the data to make decisions about the future.

3. Make sharing easy

You can give customers a unique URL that’s easy to share with their friends. When their friends click on the URL, they’ll be redirected to your platform and you can easily monitor which of your customers is bringing in more sales.

This process eliminates errors and guesswork involved in manual referral programs.

4. It’s scalable

When you have just a few referrals, it may be okay to continue with a manual referral program.

But what happens when you have hundreds of customers who can refer you to hundreds and thousands of people? Automation helps you to scale quickly without using more resources.

5. Better customer engagement

You can get creative with your referral program by introducing points and reward systems to your customers.

Non-cash incentives like points and rewards are 24% more effective at boosting performance and customer engagement than cash incentives.

Gameball’s gamification process creates a clear expectation for the players and hence, the motivation to refer more people to your business.

The good part is that referral marketing automation tools, like Gameball, can help you scale your business and turn existing customers into brand ambassadors.

6. Cost-effective strategy

Happy customers are more likely to tell others about your products and services but you need to set up a great referral marketing program to take advantage of this low-cost marketing strategy.

How to use referral marketing automation

There are many ways to use referral marketing automation. But remember that the purpose of automation is to help you eliminate routine tasks related to your referral program.

Therefore, the first step is to identify any task in your referral program that happens repeatedly and decides what will trigger them.

For example, do you want to give your customers a 10% discount for every referral? Create a trigger in your referral automation software that gives out the 10% discount once the referred signs up to your store.

After an initial setup, your referral program should continue to run smoothly and the rewards are paid out as long as the conditions of the trigger-action are met.

Here are a few questions to help you create action triggers and manage your referral program:

• How much should participants be rewarded?
• When should they be rewarded?
• How many activities should be rewarded?
• When should the commission be approved?

How to choose the best referral marketing automation tool for you

There are several automated referral program tools available on the market. So how do you choose the best referral tool for you?

Here are a few tips:

1. Find out whether you can easily integrate the program with your store and existing workflow.
2. Find out if the referral tool offers a dashboard report that gives you a clear view of your referral program.
3. Make sure the tool is easy to use and meets your requirements.
4. Make sure the referral tool you’re using comes with customer support.

Only when the automation tool meets all these requirements would you be able to scale your business and gain more loyal customers.

Conclusion

Referral programs come with many benefits. Using referral marketing automation software increases those benefits because it saves you time and effort.

Not to mention, it’s a great way to acquire customers.

Still unsure whether you need to automate your referral program or not? Schedule a personalized demo with Gameball and see referral marketing automation in action.