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How to build an effective referral program for your ecommerce business

How to build an effective referral program for your ecommerce business

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The first part entails creation. This is where you will decide on the details of your referral program before you launch it. This has three features – incentive identification, reward system selection, and program construction.

All of these are essential, so you can create a referral program that can easily succeed.

Incentive Identification

The success of your referral program will heavily depend on your incentive. Referral incentives can come in different forms. It can come as a discount code for an eCommerce website, cash, or as a free item.

The reward will depend on your target market. If you are selling services, you may want to give access to a trial of your services as a referral incentive. But this is if you can handle it. If you are selling software, a free trial version or a free upgrade will always be appreciated by referrers. You may have to do your market research to uncover the best reward for your target market.

Reward System Selection



Aside from the incentive, you also need to define the reward system. More than what you will give away, you also need to determine who you will receive the reward.


Every referral program has different reward systems. Some choose only to reward the referrer. In this model, you only give a bonus to the person who is promoting your business. But you can also choose to cite the friend. In this setup, you only provide rewards for new people that sign up for your business due to another person’s promotion.

The ideal reward system is to reward both. It is where you pay the referrer and the friend. Although this is quite costly, it is the best option out of the three, eliminating the friction or apprehension in signing up in both parties. There are only two actors in a referral program – the referrer and the friend. Paying them both for their efforts will ensure that both will do as they are told – the referrer will continue promoting your business while the friend will sign up with no complaints.

Program Construction

Once you have chosen your referral incentive and know your reward system, you can now create your referral program. This is easy. It would help if you had a trusted referral software to do the job. B

y choosing to develop your program with software, you are making it easier for you to get the program out there as soon as possible. This is the option that websites like  Drum Set Lab and Hunting Bow Lab have used in their business because it is an easy way to get your 


You can also check the FindThatLead and referral program and ear 10% on each suscription.


Referral program off the ground.

To select the right software, you should first take a look at your website platform. There is different software for every platform. Be sure to check the directories for websites like Shopify and BigCommerce for referral marketing apps compatible with the platform, such as a Shopify affiliate app. For WordPress websites, you should look for plugins. You must choose software that is well trusted in the industry and have tons of positive feedback. If you do it this way, you’ll create your program with software that supports the years to come. 

? Part 2: Promotion

It is not enough to merely create your referral program. If you have tried that already, you’ll find that it is hard enough to get your business off the ground. The mere presence of a referral program is not enough. You should promote it as well. In this section, you’ll learn some ways on how you can successfully promote your referral program and/or promote your Shopify store if you’re using it.


? Insider Promotion

I call this ‘insider’ promotion because it is a system where you promote your referral program to your existing website visitors or customers. You can do this in different ways.

First, you can easily reach your current website visitors if you link your program on your website homepage. You can also get creative with this. You can also share a link through a pop-up or slide-up bar. This promotion aims to inform your current and future website visitors that your referral program exists.

Next, you can also promote your program via email. With this tactic, you are now going to reach out to your subscribers. Subscribers are more likely to take action on your offers because they have trusted you enough to give their emails to you. You have a higher chance of getting referrers if you promote your referral program to your subscribers.

A less popular approach is to promote your referral program to your would-be customers. In this strategy, you boost your referral program to those who have abandoned their carts. You don’t need to use cart abandonment software for this. You can put a link to your referral program in your checkout cart or email. This strategy works because it gives your would-be customers a reason to go back to your website to continue the transaction. Often, it is because of the reward.

? Affiliate Promotion

Aside from referrers, you can also create an affiliate program for your business. An affiliate program is different from a referral program because its target market is often marketers, and the reward is usually a percentage of the profits. You don’t even need to worry about where to market your affiliate program; you can launch your affiliate program alongside your referral program.

? Business Promotion

A less popular but highly effective approach is to promote your program to other businesses. These businesses may not be in direct competition with you, but their target market is also similar to yours. Please don’t take a small business referral lightly, for it will allow you to get multiple leads from several businesses. Plus, these leads have a higher likelihood of converting into sales.


As you can see, it is not that hard to create a referral program for your eCommerce business. But its success is highly dependent on your promotions. So learn to promote it frequently. It can help your business.


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