The viral forward-to-a-friend tactic might be a quick way to build up a list, but others argue the process falls short. Are these referral marketing campaigns effective? Our experts weigh in
More than 10 years marketing and online experience
The forward-to-a-Friend gimmick is a failed attempt by e-mail service providers to incorporate viral marketing tools into their applications. Because 100% of the most commonly used e-mail clients have a forward e-mail feature, people use that instead. The only thing we e-mail service providers can do to save face is to hope that the feature reminds people to use their forward button.
A recent survey to online marketers by the Email Experience Council asked, “What is your most successful list-building tactic?” Only 6% chose “Viral: empowering subscribers to share my e-mails via forward-to-a-friend,” 9% chose “Acquisition: growing by renting lists,” and 84% chose “Organic: capitalizing on sign-up opportunities across all of my channels.”
These statistics prove that the forward-to-a-friend process is inadequate, and a more formalized referral program is needed for success. A good program is automated, timely and usually starts where the original opt-in process ends. Once a Web site user has gone through the motions of opting in, it is a perfect opportunity to ask for a referral. Ask the referrer not only for an e-mail address, but also a full name. When soliciting the referee to opt-in, always personalize the message and, most importantly, reference the referrer — this gives you instant credibility and will produce a much higher conversion rate.
SVP, strategic services, Epsilon
More than 15 years experience in e-mail marketing
Ever-increasing referral marketing applications and opportunities provide a cost-effective way to grow your e-mail file. A remarkable 65% of consumers forward coupons from CPG company e-mails to friends, and 55% forward retail e-mail offers, according to a recent Epsilon survey.
Also, the most up-to-date measurement of “pass-along” readership, the percentage of recipients who forward to a friend who in turn clicks on an e-mail link, shows the needle is holding steady at 0.5%, meaning one of every 200 delivered e-mails reaches an advocate for your brand. Special note to those in financial services and consumer products: Pass-along is highest in your niches, due to the popularity of credit card offers and Web coupons.
Referral programs can take the form of a special sweepstakes or coupons awarded to both the current customer and the referred person.
Hotmail is a classic “referral” case study. At startup, Hotmail attached a simple tagline at the bottom of each e-mail sent by existing users asking their friends to sign up for an account. After a month, the company had 20,000 subscribers. Within 18 months, it had 12 million.
Consumers use forward-to-a-friend e-mails because they have something to share. Personal endorsements are a powerful way to have your brand advocates do your marketing and your prospecting for you.
Mabley argues referral marketing is a cost-effective way to grow e-mail files, and that personal endorsements can be a powerful tool for consumers. Ashery contends the forward-to-a-friend process is an inadequate gimmick, and a more personalized referral program is needed in order to intelligently track activity and conversion.
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