Framing
A referral program is a marketing strategy where companies encourage existing customers to refer new customers in exchange for rewards or incentives. It leverages word-of-mouth marketing and utilizes unique referral codes or links to track successful referrals. By tapping into their customer base, companies can acquire new customers at a lower cost and foster customer loyalty.
In the financial market, converting a user is very difficult due to the barrier of trust. Users tend to prefer apps through word-of-mouth referrals or influencers, so implementing a referral program will help improve user growth.
An important factor to consider when designing a referral program is to ensure that money spent on the user is effective.
Referral program will help our most engaged or active users invite their friends and increase the app's user base, without spending money on marketing.
Objective
Business goal: increase user growth
• Marketing department needs this function ready to support their campaigns.
• Use this program to share benefits with collaborators (KOC).
User goal: To invite their friends to benefit from the product.
*Throughout this article we call the person, who refers a friend a “referrer” or “advocate” and the person, whom they refer, a “referee” or a “referred friend.”
Discovery
Rewards discovery
Which rewards will attract users and be suitable for the business side?
A referral program based on incentive rewards can encourage users to perform desired actions. Therefore, it's important to define the rewards that will attract them.
Each type of reward (money, coupon, cash back, commission, etc.) has different pros and cons depending on our product and phase. Let's take a look at some examples:
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Our goal is to spend money only on activated users and ensure that we generate revenue before giving back to the user. Currently, we use the same incentive rewards for general users and KOCs. As a result, we have chosen "commission" as the reward. Users will receive a commission after their friends make a purchase.
Scenario discovery
Different scenarios will require different functions.
Referrer
- Users who see the benefits of the referral program and are confident in the product will want to share the app with their friends.
- There are two types of users: general users and influencers (KOC)
Referree
- Referees ask their friends for suggestions and receive an invitation to the app.
- Referees learn about the product from their friends.
- Referees view content from key opinion leaders (KOLs)/influencers and learn about the referral program.
Channel
- Sharing via message
- Sharing via post on blog
- Sharing via link
- Face-to-face interactions
Design
Journey mapping
To create an effective referral program, we need to identify opportunities and touchpoints throughout the entire customer journey. This will help us determine which functions are necessary, which ones we should have, and which ones would be nice to have.
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Overall flow
Use case
UI breakdown
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Key learning ☕
- Each design needs careful consideration of operational and business issues: specifically in this case study, there are rewards that may be more appealing to users but may not bring much benefit to the business.
- Each element in the design needs to be discussed early with the engineering team to evaluate its complexity: for example, the design wants to display information about the top 5 people with the highest commission benefited from this referral program (updated weekly) and the engineering team needs more time and effort to collect data.