What is International Referral Marketing?

Gone are the days when businesses were subjected to a limited, low-paying local audience. The internet has paved the way for businesses to expand their presence beyond geographical barriers, cater to an audience most befitting to their offerings, and boost their revenue.

The global stage is not exclusive to enterprises with deep pockets, nor is it an unsurmountable task that might require huge human resources. Craft a product that beats the odds and be a little creative with your marketing strategy, and the world is yours!

International marketing for any business means a creative strategy and understanding of the world markets and consumer choices that vary with it. Perhaps, the easiest and economical way to grow globally is a referral program. Create hype around your brand, promote it through appropriate channels, and let people carry the word across.

The strategy might seem pretty straightforward, but landing a global audience requires some due diligence to configure legal and cultural aspects. Read on to learn everything about international referral marketing along with successful examples that made it big worldwide.

International Referral Marketing Program: The Basics

Come the 21st century, every upcoming business is looking to establish a global fanbase. With the onset of the internet and rising connectivity, that hardly seems unachievable.

The success of many multi-national companies is grounded in word-of-mouth - leveraging the positive sentiments that existing customers hold towards your brand and incentivizing them to propel them onto others. But building a reputation outside regional borders where people hardly know your brand, demands some serious effort.

An international referral program harnesses the customers’ loyalty toward your brand or creates hype around an upcoming product launch, to reach new audiences.

Startups instate a robust promotion strategy to draw anticipation in the target audience and incentivize them with freebies and cashbacks to transfer the hype within their networks. By encouraging prospects from across the world to reach out to their friends, businesses can create a ripple effect of new leads which in turn expands their reach to unexplored markets.

Benefits of International Referral Marketing Strategies

International marketing isn’t a new concept, established companies like PayPal, Tesla, and Airbnb have been using the concept to reach their global fanbase for years.

The advent of social media, websites, and online advertising platforms has been the main catalyst in streamlining global marketing. The strategy has become a baseline for startups and big companies to achieve:

Expansive Customer Outreach

While reaching new customers has become a lot easier given the prevalence of technology, businesses still struggle to spread past their home markets - using traditional marketing practices at least.

One effective way to gain access to unexplored markets is to motivate your current audience to do the legwork. Recommendations from friends and family carry more weight due to inherent trust in these relationships, resulting in a wider more receptive audience being introduced to your brand.

Rapid Market Penetration

Entering a new market often means starting from scratch in terms of trust, and in unfamiliar territories it’s hard to establish. New markets may have language barriers, regulatory challenges, and cultural differences requiring special assistance from local audiences - something that comes built-in with customer referral programs.

Since the referrals are brought in by people who are known and trusted, it reinforces your foothold in the market and fast-tracks scalability. Leverage the opportunity properly and you can even capture viral growth.

Increased Sales Revenue

Going global means a higher customer turnover which in turn results in increased sales revenue, but sometimes there’s more at play. Targeting your audience with a strong reference improves your chances of conversion by 37%. Not to mention, referred leads are inclined to spend more and stick longer than the ones acquired through other marketing outlets.

As more people channel in through referrals, you not only expand your customer portfolio but also give your business a sales boost. What’s better is, that you can build a continuous loop of new clients - referred customers turning into advocates for your brand kicking in fresh high-paying leads on repeat.

Scalability

Traditional marketing campaigns can strain resources, especially when scaling globally. Entering new markets requires time and substantial groundwork. Market research, regulatory compliance, cultural adaptation, and building local partnerships often put your expansion efforts to a halt, unless you operate through a referral program.

Referral marketing works by leveraging existing connections of its loyal customers who expedite their entry and lay the foundation for new customer acquisition channels, leading to scalability.

How to Create a Referral Program for Global Outreach?

The idea of expanding your business to unclaimed territories is equal parts exciting and challenging. While scalability sets you up for a higher customer inflow and sales revenue, there’s much you need to consider about ethical and legal considerations to stay ahead of the curve. Here’s a step-by-step process of building a referral program that is globally scaleable.

Market Research

Whether you’re laying the foundation of a startup or planning to expand it globally, start with market research. Identify who your ideal audience is, what country or region they belong to, and what product genre would appeal more to them.

Done right, market research helps you pinpoint the right audience segment in a market that is not only interested in buying your product but also keen to participate in the program.

Every foreign market has a unique legal and ethical structure and favors varying communication channels. Market research helps understand cultural sensitivities, allowing you to tailor referral program messages and incentives in ways that fulfill regulatory requirements and resonate positively with the audience.

Set Clear Objectives

Going global requires more than just enthusiasm; it demands a well-defined roadmap outlining tasks from start to end. Before any expansion, think of what you want to achieve with your program. Is it multi-natural presence, diversity in audiences, or innovation in the products you’re about to offer?

Are you aiming to expand market reach, increase sales, boost brand awareness, or enter new international markets? Defining this purpose sets the tone for the entire program.

One thing that companies often overlook during expansion is the hiring costs that come alongside. Suppose you’re setting up a regional office in an area; figure out the labor skills, average hourly rate, and other legal compliances before moving forward.

If you’re expecting a high participation and referral rate, keep the terms and conditions clear for common folk to understand and incentives lucrative enough to compel them your way. The clearer your objectives are, the easier the accountability afterward regardless of the type of referral programs.

Standardize the Program Strategy

Instead of draining your resources on localizing your program terms for specific audience segments and risking user experience, set a standardized structure that maintains coherence.

A standardized program strategy ensures that the brand's message and values are upheld consistently across all markets. No matter what end of the world your customer belongs to, they will participate in the same program and earn rewards from the prize pool. It not only saves time but also helps you direct your resources more efficiently.

The budget you’d otherwise spend on translating the terms and devising relevant rewards can be directed to more pressing issues like brand promotion and market research.

Choose a Pertinent Incentive Structure

Not everyone is driven by the same motives to purchase a product or participate in a program. Sometimes, the rewards that work in one region may not resonate with the audience in another.

Opt for referral incentives that hold universal value, such as discounts, cash rewards, or free products/services. When something is offered without a price tag, it transcends the cultural and language barriers keeping referrers engaged until they redeem the reward.

Even though money is the biggest motivator, it may not entice an audience who has their wallets full. An early access or loyalty point may keep them engaged and compelled to refer others. But for the regular folk, only some real hard cash will get them kicking to spread the word about your brand.

Leverage Technology

Technology integration can make your referral program accessible to anyone with an internet connection and an interest in your offerings, connecting with people beyond geographical borders.

Not just that, technology streamlines the process of participating in a campaign, generating leads, and earning valuable rewards in return. User-friendly interfaces, intuitive navigation, and clear instructions make sure that everyone can understand your offerings and guidelines to achieve them.

Almost every other company is now introducing referral marketing software to keep things transparent and efficient on either end. Participants receive instant alerts about successful referrals, rewards earned, and program milestones, regardless of their time zone.

Promote the Program via Global Channels

The key to attracting widespread participation for your program is to advertise it through the right channels, especially ones with a global outreach. Here are some ways to popularize your international referral marketing campaign:

• Utilize popular social media networks like Facebook, Twitter, Instagram, and LinkedIn to get global attention.
• Create blog posts, articles, and video content that address the company policy and are tailored to specific regions or languages.
• If you have a mobile app referral program, use in-app notifications and messaging to inform users about the campaign.
• Host webinars or virtual events that discuss your referral policy and value insights from the audience.
• Collaborate with media influencers and bloggers to tap their social following and credibility to gather new leads.

Set up Cross-Culture Communication Support

Every product launch campaign needs a follow-up post-launch strategy to monitor the incoming leads and most of all address customer queries. When catering to a global audience, you’re bound to attract an audience with diverse cultures and languages.

As the marketing manager, you must instate the proper mechanics and customer support personnel in-house to interact with new leads. Implement virtual assistants or chatbots that can provide instant responses to common queries in a language that your audience is comfortable with. Use strong visuals, graphics, and icons that get the message across without relying solely on language.

Industries that Implement International Referral Programs

Taking a referral program globally requires more than a one-size-fits-all approach. The referral process demands careful consideration of cultural nuances, customer behaviors, and regional preferences.

Before you start trial-run various tactics to derive your best referral marketing campaign, take a look at how industry leaders have attracted global attention through successful referral programs.

E-commerce and Retail

As an e-commerce or retail store, you’re always on the outlook for better engagement on your site and attracting fresh leads to pump conversion rates. Referral programs are your best shot at achieving those objectives without burning cash on tough-to-track marketing tactics.

By incentivizing existing customers with rewards, you can gather high-quality leads that are bound to stay and spend more. Many brands have adopted the strategy to capture large audiences and grow their customer bases. As a startup looking to go big, use their programs as inspiration to fuel your growth.

Harry’s

Harry’s more than an e-commerce shaving brand. The company has introduced a subscription-based service alongside the regular e-commerce store to keep its customers from drifting away.

Although Harry’s referral program isn’t currently active, the brand visualized enormous growth during its launch. The strategy worked phenomenally, generating 100,000 leads before the launch day.

Harry’s offered segmented rewards as part of its pre-launch campaign, offering users gift boxes or swag in exchange for referring new leads. While the referred-in customer received 10% off their first purchase.

SaaS Technology

Referral programs are proving to be the way forward for B2B and B2C SaaS companies. The strategy ensures one of the lowest customer acquisition costs for any other marketing channel. Since most SaaS startups work on a subscription-based model, it’s an effective concept to engage customers long-term.

But what makes the B2B referral program even more effective in the niche is that SaaS marketers do not have to offer cash rewards or freebies in return for referrals. Rather, exclusive access to the premium package or early access to the program before launch serves equally inviting for customers to jump on board.

Dropbox

Of course, we cannot mention SaaS referral programs, without paying tribute to the company that laid its foundation in the SaaS space. Dropbox is one of the first startups to harness reward programs to drive its growth, which worked excellently.

The cloud storage company managed to achieve a 3900% growth in customer acquisition within the first 15 months of the campaign. Surprisingly enough, the campaign wasn’t powered by a monetary reward or swag incentive.

Dropbox offered free storage space worth 500 MB up to 16 GB to referrers, based on the number of leads they registered to the platform. The incentive structure did not only compel prospects to register on the platform but also laid the foundation for their long-term connection with the company.

Travel and Hospitality

For an industry that thrives on trust and credibility and interacts with a global audience, harnessing a referral marketing program seems the only viable strategy. To put it simply, the travel and hospitality sector derives most of its leads through its existing customers, referring you within their circles of influence.

Capitalizing that human dependency on each other for recommendations allows hospitality companies to capture referral growth. As more customers share their positive experiences with friends and family, you can establish a constant inflow of new leads expanding your customer base.

Airbnb

As crucial as it is for a company in the hospitality sector, Airbnb propelled most of its early growth through referral programs. The company founders knew early on that a strong reputation and consumer trust are the prerequisites for growth in the niche.

The thought led them to instate a referral campaign in 2009, taking them from 1,000 users to 2 million in just about 2 years. The strategy contributed to 35% of all incoming customers by 2014. The concept was simple; the referrer would receive a $25 travel credit while the customer who joined via a unique referral link received a $25 discount on their first booking.

Financial Service

Despite the widespread of fintech startups in recent years, consumer’s trust in these financial services still wavers. No matter how well you project your startup, people still value the recommendation of their friends and family over paid ads.

So, bringing in new customers to your new-found brand will require a careful implementation of word-of-mouth marketing.

Robinhood

Inspired by Dropbox’s success with its referral program, Robinhood launched its referral campaign in 2013 but with a slight twist. The fintech startup introduced the program as part of its pre-launch campaign while the platform was still under development.

Nevertheless, Robinhood caught widespread attention, gathering 1 million signups months before the actual launch date without any monetary incentive. In exchange for referring to their networks, customers were awarded a rank up in the pre-launch waitlist.

Closing Note

If you have global aspirations for your startup, dive deep into market research and the target audience. Understand how foreign markets behave, the trends they follow, and how consumers intercept these trends before creating a referral marketing strategy. The more in-depth your homework is, the better suited you are at engaging the prospects and motivating them to do the bidding for you.

An international referral marketing program comes with great responsibility and management overload, often challenging for marketers to handle alongside other tasks. Sign up with Prefinery.com to streamline your referral campaign for a compelling global response.

FAQs

How can an international referral program benefit your business?

International referral programs offer several benefits for businesses, including rapid market penetration, increased sales, expanded customer outreach, and enhanced brand credibility. Implemented correctly, these programs generate higher leads, resulting in cost-effective customer acquisition and amplified brand presence.

How international referral programs are managed?

Technology plays a pivotal role in managing international referral programs. Online platforms, referral software, automated communication and marketing tools, and analytics systems are commonly used to communicate with participants and track referrals globally.