Are you looking to build a referral program for your SaaS?
Then keep reading!
At Referral Factory, we believe that every single business in the world should have a referral program. Especially SaaS companies! That is why we launched our easy-to-use referral software, to make it simple and fast for any business to build, launch, and run its very own referral program 👏
We know it can be overwhelming to get started creating your own SaaS referral program, especially if you have never created a referral program before, so we've written this guide to help you get started.
Table Of Contents
1. The benefits of a SaaS referral program
2. Planning your SaaS referral program
3. Building your referral program
4. How to issue referral links automatically, to every user that logs into your SaaS platform
5. How to market your referral program better, and get more referrals
6. How to qualify your referrals when they convert
7. How to track who referred who, and see who needs to be rewarded
1. The benefits of a SaaS referral program
Lower your CPA - referral marketing turns your existing users into a new marketing channel. It's essentially a performance marketing channel where you only pay AFTER a user/lead/customer has converted.
Increase your conversion rates - referred users are 2x more likely to convert than users acquired through paid marketing channels. Why? Because referrals from friends are trusted more than any other source.
Get more high-value customers - users that a friend has referred are more valuable. In fact, referred users spend 13.2% more on average than other users.
2. Planning your SaaS referral program
The key to building a successful referral program begins with a clear plan. Start by setting goals, decide on a reward/incentive, determine how you want your referral program to work, create the right messaging, and think about how you will launch your campaign. Below are three tips to consider when planning your own SaaS referral program:
Implement a double-sided referral program - offering an incentive to new users increases the likelihood of them converting. The incentive does not have to be a discount or something monetary. It could be something that you already offer with your software such as a free trial or priority support.
Make it easy for users to refer - the easier it is for users to refer, the more likely they are to refer. Software such as Referral Factory allows users to be able to share their referral links directly with their friends, on a social channel they choose by tapping on a single button.
Reward in your own currency - offering a discount on subscriptions or a free month is a great way to increase retention because users will have to continue to use your software in order to get their reward.
Pro Tip: This is a good guide to read before you get started - 8 Steps to building a referral program.
3. Building your referral program
With Referral Factory, there are two options for you to build your SaaS referral program.
Option 1 (Do it yourself) - You can use any of Referral Factory’s SaaS plans to build your own referral program. Our campaign builder allows you to create a referral program, customize it, style it, and get it launched. You can learn how our drag-and-drop campaign builder works by watching our demo video below. Once you have built your campaign, most SaaS companies also do an API integration to 100% automate their referral program (to track conversions, and issue rewards) - we’ll discuss this more in the points below.
Option 2 (Let us do it for you) - If you don’t have the time, the patience, or the know-how to build your own referral program - you can hire a Referral Factory Expert to do the work for you. This means you pay for your subscription fee monthly, and you hire a certified expert from our team to design, build and automate your referral program as per your requirements. This expert can also help you do the API integration, that most SaaS companies opt for.
This service is often used by companies who don’t have their own resource to do this, on average customers hire an expert for 10-20 hours depending on the scope of the referral program they are trying to build.
Regardless of the option you choose, this article will help you build your referral program in 8 steps
4. How to issue referral links automatically, to every user that logs into your SaaS platform
Once you have built and published your referral campaign, it's time to connect to the Referral Factory API - so that you can automatically issue referral links to every user that logs into your saas platform. See the example below, of what we mean by this:
Our API has a function to “Create a new user”. This gives you the ability to:
Add a new user in your referral campaign, at the same time as that user registers or logs in on your website. Then call back that user's referral link to surface in your own saas platform.
Here is an example code that you can use to add users to your campaign:
curl "https://referral-factory.com/api/v1/users" \
-H "Authorization: Bearer your_access_key" \
-X POST \
-d "campaign_id=1&&first_name=John&email=john@example.com"
Every time you ‘add a user’ via API, you will get a response that looks like this. This is the users' referral link, and share messages that you can surface inside your own platform - making it quick and easy for them to SHARE their referral link with their friends!
{
"data": {
...
"campaign_id": 1,
"qualified": false,
"first_name": "John",
"email": "john@example.com",
"sharing": [
{
"social": "facebook",
"url": "https://referral-factory.com/{random-code}/socials/facebook"
},
...,
{
"social": "sms",
"url": "https://referral-factory.com/{random-code}/socials/sms"
},
],
...
},
"code": 201,
"message": "User successfully added."
}
You can add share buttons inside your users' dashboards so that they can quickly share their links with friends. If you do an API integration with Referral Factory, you will have a lot more flexibility to show things inside your platform like:
- A users referral link and share buttons (can call this from the API)
- A users analytics showing their reach, referrals, and referrals converted (can call this from the API)
- A leaderboard of top referrers (can call this data from the API, and sort it how you see fit)
- And much more!
Here is an example of how we used our API to surface users' links inside their dashboards and how easy it is for them to share their links.
Airbnb also had a lot of success placing their users' referral links inside their accounts making it easier to share.
5. How to market your referral program better, and get more referrals
Once you have built your campaign, the next thing you need to do is promote it. Referral marketing is an ongoing process, the more people that know about it, the more referrals you'll get. In fact, referral programs that perform the best are ones that are frequently marketed.
Here are our top three tips that you can implement to market your SaaS referral program.
- Add users referral links inside their dashboard to make it easier for them to refer friends
- Prompt users to refer a friend after they have had a positive experience
- Add a referral widget to your website
Read this article to find out more ways to get users referring fast
6. How to qualify your referrals when they convert
Referral Factory gives you the flexibility to choose what counts as a conversion. It could be when a user signs up for a free trial, when they pay for their first subscription or after they have paid for a subscription without requesting a refund.
You can use our API to send referred users directly into your platform, and then create a rule that pings Referral Factory as soon as that user performs an action on your platform that counts as a conversion.
Our system tracks that converted referral back to the person who initiated the referral and assigns it to their Converted Referral column. This makes it really easy for you to keep an eye on successful referrals.
If you use a CRM to track users when they sign up and when they convert then you could also use Zapier, webhooks, or any of our CRM integrations to automate this process for you.
This article highlights the different ways to qualify referrals.
7. How to track who referred who, and see who needs to be rewarded
Referral Factory makes it incredibly easy to track successful referrals so you know who needs to be rewarded and when. You can track your users’ referrals in two ways:
From your users' tab - this no-code option allows you to easily view who referred who and which of those referrals successfully convert.
By calling your data from the API - this option will require some coding but you can use the API to call back all of the data from your dashboard and surface it in your platform so you can see which users have made referrals and which of them have converted.
Pro Tip: You could also do this and surface your users’ information in their own account or portal so they can also see how many referrals they have made.
From the screenshot below, we can see that Arman signed up and was referred by Lus.
This screenshot shows you how to identify referrers that need to be rewarded. From here we can see that Jess has 10 referrals. A referred user is someone who joins your referral program - in other words, a potential lead or customer. We can also see that of the 10 referrals that Jess has made, six of them have converted. This means Jess needs to be issued six rewards.
You can also sort your users by how many referrals they have made. This makes it really easy to identify those power users who are bringing in the most leads for your platform. In the screenshot above, Jess is one of the power referrals for this campaign.
Successful referral campaigns are born from a great product offering and a community of happy customers. Referral marketing campaigns are the only way to accelerate word-of-mouth referrals, see real customer growth, and have a steady increase in revenue. If you haven't launched your referral campaign yet - you're missing out!