Scale SaaS Referral Programs: 10 Best Practices

Want to grow your SaaS business through referrals? Here are 10 key practices to scale your program:

1. Make your product easy to recommend
2. Create good incentives
3. Make referrals easy
4. Use data to improve
5. Automate program management
6. Personalize referrals
7. Help your advocates
8. Promote across channels
9. Keep testing and improving
10. Expand globally

Quick comparison of referral program benefits:

These practices will help you create an effective referral program that drives growth for your SaaS business. Focus on making it easy for users to refer others, offer compelling rewards, and continuously optimize based on data.

Basics of SaaS Referral Programs

SaaS referral programs help companies grow by using current customers to find new ones. Here's what you need to know about these programs.

Main Parts of Referral Programs

A good SaaS referral program has these key parts:

1. Ways to Share

• Email invites
• Social media posts
• In-app links
• Personal codes

2. Rewards for Users

• Discounts on future plans
• Extra features or credits
• Money or gift cards

3. Tracking Tools

• Special links for each user
• Dashboards to see results
• Links to customer databases

Why Referral Programs Work Well

Referral programs offer many benefits:

Problems When Growing

As referral programs get bigger, they face some issues:

1. Finding good referrers 2. Giving out rewards quickly 3. Stopping cheating 4. Keeping people interested 5. Working in different countries

1. Make Your Product Easy to Recommend

To grow your SaaS referral program, start with a product that customers want to share. This sets the stage for more referrals and natural growth.

Make Your Product Better

Focus on creating a product that solves problems well. Work on:

• Easy-to-use design
• Fixing common issues
• Adding new features based on what users need

When customers like your product, they're more likely to tell others about it.

Find Features People Want to Share

Look for parts of your product that make users want to share:

• Tools for working together
• New ways to solve common problems
• Special features that make your product stand out

Make these features easy to find and use. Show users why they're helpful.

Listen to What Customers Say

Ask users what they think and use their ideas to improve your product:

Use what you learn to make your product better for current users and new ones they might refer.

2. Create Good Incentives

Good rewards are key to growing your SaaS referral program. The right rewards make customers want to tell others about your product.

Choose Reward Types

Pick from two main types of rewards:

Airtable gives $10 credit, which works well. Todoist offers a free Pro trial, which can also get more referrals and make people use the product more.

Give Rewards to Both Sides

Make sure both the referrer and new customer get something:

• Both get rewards: Like Gusto, which gives $300 to referrers and $100 to new sign-ups.
• Only new customers get rewards: This can work to spread the word about your brand.

Giving rewards to both sides makes more people want to refer others and sign up.

Use Different Reward Levels

Set up a system with different reward levels:

This setup makes customers want to refer more people, helping your SaaS product grow steadily.

3. Make Referrals Easy

To grow your SaaS referral program, make it simple for users to share your product. An easy process gets more people to join in and tell others about what you offer.

Simplify Sharing Steps

Make your referral process quick and easy:

• Give users ready-made messages to send
• Let users import their contacts quickly
• Offer many ways to share (email, social media, text)
• Use short, easy-to-remember referral links

By cutting out extra work like writing messages or typing emails, you can get more people to make referrals.

Add Quick Sharing Options

Put in one-click sharing to make referrals fast:

Put these options right in your product where users can easily find them.

Make It Work on Phones

Since many people use phones, your referral program should work well on them:

1. Make sure it looks good on all screen sizes

2. Use big buttons that are easy to tap

3. Add ways to share that work well on phones, like texting

4. Make sure pages load fast on mobile networks

4. Use Data to Improve

Using data helps make your SaaS referral program better. By looking at numbers and testing different ideas, you can find out what works best and make smart changes.

Track Key Numbers

Keep an eye on these important numbers:

By watching these numbers, you can see how well your program is doing and make it better.

Try Different Things

Testing different ideas helps you find what works best:

1. Pick something to test, like rewards or messages

2. Make two versions of it

3. Show each version to different groups of users

4. See which one works better

5. Use the better version for everyone

For example, Casper tested two reward options:

Version A worked better, with 26% more shares and 16% more sign-ups.

Guess What Will Happen

Looking at past data can help you guess what might happen next:

1. Collect old information about referrals

2. Look for patterns in what worked before

3. Use computer programs to guess future results

4. Group users based on how likely they are to refer others

5. Send different messages to different groups

This helps you focus on users who are more likely to refer others, making your program work better.

5. Automate Program Management

Making your SaaS referral program run on its own helps it grow better. Using the right tools can save time and let you focus on making the program bigger.

Choose Good Software

When picking software to run your referral program, look for these things:

Try out different options before you choose. Some good ones are Referral Rock, ReferralCandy, and Mention Me.

Make Rewards Happen on Their Own

Setting up rewards to go out automatically makes users happy and saves you time.

Good ways to do this:

• Track referrals as they happen
• Tell users right away when they get a reward
• Give out rewards without you doing anything
• Change rewards based on how many referrals someone makes

For example, Dropbox adds storage space to users' accounts right away when they refer someone new.

Connect Your Tools

Making your referral program work with your other tools helps everything run smoother.

Tools to connect:

For instance, if you connect to your customer database, you can add new customers from referrals and see how much they spend over time.

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6. Personalize Referrals

Making referrals personal helps your SaaS referral program grow better. When you tailor the referral experience to each user, more people join in and sign up. Here's how to make your referral program personal.

Group Users

Putting users into groups helps you make better referral campaigns. Here are some ways to group users:

By grouping users, you can make referral offers that fit them better. For example, you might give different rewards to people who use your product a lot compared to those who don't use it much.

Make Messages Personal

Personal messages can get more people to refer others. Try these ideas:

1. Use the customer's name in emails about referrals
2. Talk about parts of your product they've used
3. Give rewards based on what they like and do
4. Mention things the referrer and their friend might have in common

For example, instead of saying "Tell a friend and get a discount," you could say "Hi [Name], we see you like our task manager. Share it with your team and get a free month!"

Use Custom Pages

Special pages for each referral can get more new customers to sign up. Here's what to do:

A custom page might say hello to the new user by name, mention who told them about your product, and show features their friend uses often. This personal touch can make new users feel welcome and more likely to sign up.

7. Help Your Advocates

Making your advocates more effective is key to growing your SaaS referral program. Give them the right tools and support to boost your program's success.

Make Clear Guides

Create easy-to-understand guides to help advocates promote your product:

Give Marketing Tools

Provide advocates with materials to make referrals easier:

These tools help advocates share your product more easily and get more people to sign up.

Build a Referrer Community

Create a group for your advocates to help each other and learn:

1. Online Group: Make a place where advocates can talk and share ideas.

2. Online Meetings: Hold regular online talks to share news and answer questions.

3. Top Performer Rewards: Show off the best advocates to encourage others.

4. Special Events: Plan online or in-person meetups for active advocates.

5. Feedback System: Set up a way for advocates to give ideas about the program and product.

8. Promote Across Channels

Getting the word out about your SaaS referral program on different platforms helps more people see and join in. Here's how to do it well.

Add In-Product Prompts

Put referral messages inside your product to make it easy for users:

1. Use pop-ups and alerts with clear "Click Here" buttons
2. Show different messages to different users
3. Put referral links where users can easily find them (like in the main menu)
4. Show messages after users do something good or reach a goal

Use Email Marketing

Emails are still great for telling people about referral programs:

Tips for good emails:

• Make them fit each group of users
• Add clear "Click Here" buttons and ways to share on social media
• Show what's in it for both the referrer and new customer

Use Social Media and Content

Use social media and blog posts to let more people know about your program:

1. Share stories from happy customers
2. Make content that's easy for people to share
3. Use ads to reach possible referrers and new customers
4. Talk with your followers in comments and messages

For B2B SaaS companies, try these ideas:

9. Keep Testing and Improving

Always work on making your SaaS referral program better. By trying new things and using data to make choices, you can keep your program working well and meeting what users want.

Try New Ideas

Get your team to come up with fresh ways to do referrals:

• Have regular meetings to think of new referral plans
• Make it okay for team members to suggest and test new ideas
• Set aside money to try different referral methods

Tip: Make a special fund for testing new referral ideas. This lets you try new things without risking all your program money.

Check Program Rules Often

Look at how your program is doing regularly:

• Look at your referral program every month or every three months
• Check important numbers like how many people sign up, how much it costs to get new customers, and how much referred customers spend over time
• Use tools like Friendbuy to keep track of how well your program is working

Listen to What Users Want

Pay attention to how users act and what they say:

• Ask users what they think about the referral program
• Look at social media and help channels to see what users are saying
• Test different parts of your referral process to see what works best

For example, Casper tried two different reward plans:

This test showed that giving a bigger discount to friends worked better than giving more to referrers.

10. Expand Globally

As your SaaS referral program grows, you can reach new markets around the world. This growth needs careful planning and changes for different countries.

Change for Different Markets

When growing your program in other countries, think about local customs:

• Learn about what people like in each new market
• Change your messages and rewards to fit local tastes
• Work with local famous people or brands to build trust

Tip: Make a list of things to change for each new market to make sure your program fits in.

Deal with Language and Money

Handling different languages and money is important when growing globally:

Follow Rules in Other Countries

You must follow the laws in every country where you do business:

• Learn about data privacy laws like GDPR in Europe and CCPA in California
• Make sure your program follows anti-spam laws in each country
• Keep user information safe in all countries

Important Legal Things to Do:

• Ask users if it's okay to collect their information
• Tell users clearly how you use their information
• Check often to make sure you're following all the rules

Conclusion

Growing SaaS referral programs is key for doing well in the software business. By using the tips in this guide, companies can make strong referral programs that help them grow. These programs use happy customers to bring in new ones.

Here are the main things to remember:

To make your program work well:

• Look at numbers like how many new customers you get and how much they spend
• Use software to manage referrals and see how well they're doing
• Change your program to fit what each customer likes
• Make your program work in other countries by changing it to fit local needs

As the SaaS world keeps changing, referral programs will stay important. By always trying to make your program better, you can:

• Get more customers to tell others about your product
• Keep customers using your product longer
• Grow your business in a busy market

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