Individuals affect other people. Nothing has more of an impact on people than a reference from a reliable friend. The marketing holy grail is a reliable recommendation.
A successful SaaS firm requires minimal acquisition costs, efficient lead-to-customer conversion, and maximising client lifetime value.
You can do all of these things using referral marketing. In order to inspire you to create your own refer-a-friend campaign, let’s first take a look at the advantages of referral programmes for SaaS businesses before moving on to some really successful SaaS referral programme examples.
If you give a free subscription for X months or other product-related discounts as a reward, the cost of the referral programme is made up of the cost of prizes as well as the cost of the referral software you employ to run your SaaS referral programme.
If done properly, referral marketing typically proves to be the most cost-effective marketing channel for SaaS when compared to other channels.
raising conversion rates
Referral marketing is a very effective marketing channel that can increase conversions for your SaaS product as well as brand awareness. According to a study conducted by Extole, referral marketing provides conversion rates that are 3-5 times higher than those from any other channel.
Reduce the attrition rate
The annual percentage rate at which consumers discontinue using your SaaS product is known as the churn rate. SaaS referral systems do not inherently encourage customers to use your product more frequently. Due to the fact that consumers acquired through referrals are typically more devoted to your brand than those acquired through other channels, they can assist you in indirectly lowering your churn rate.
They provide their consumers the most beneficial reward, similar to PayPal, which is cash or a free transfer.
They don’t just hand out cash in large amounts like PayPal did in the 2000s. Instead, they improved the program’s restrictions. Referrers are only eligible for rewards if they recommend three friends who each make transactions totaling at least €200. This guarantees that the financial prize is only available to a select few.
Referees receive free international transfers instead of payment. They are motivated to utilise the product and get dependent on it by this type of reward. It also guarantees that people won’t utilise the referral solely for financial gain.
They must transfer money in order to receive the benefits of the referral programme. They are Transferwise’s target market if they require making international money transfers. The referees who receive this kind of incentive have already met the requirements. Additionally, it costs less than simply paying cash.
Transferwise was able to stop fraud thanks to the referral rewards’ restrictions and type of rewards. Because these three referees must also transfer money, the referrer cannot just establish 3 false profiles to receive the reward.