How to Set Up a Customer Referral Program
4 min read
Your regulars already recommend you. A referral program gives them a reason to do it more often, and rewards both sides fairly.
Why referrals work
People trust recommendations from friends more than advertising. A referred customer arrives already expecting a good experience, and often has the same tastes as the friend who sent them.
A referral program doesn't create word of mouth. It rewards the word of mouth you already have and makes it easy to act on.
Reward both people
The simplest programs give something to both the customer who invites and the friend who joins. The inviter has a reason to share, and the friend has a reason to try you.
For a business with a loyalty card, bonus stamps or points work well: they cost you only when they're redeemed, and they bring both people back for another visit.
Pay only for real customers
A referral bonus should be earned by a real visit, not a sign-up. Give it only after the new customer has made their first purchase, so you never pay for accounts created just to claim a reward.
In Beewa, bonuses are given only after you stamp the new customer yourself. Someone who is already your customer can't be referred, two accounts on the same phone are refused, and invites expire after 90 days.
Choose the bonus size
Keep the bonus meaningful but small compared with the full card. If a new customer starts halfway to a reward, some people will create accounts just to claim it; a stamp or two is usually enough to make the first visit feel like a head start.
Each referral costs you both bonuses, so check the total against what a new regular is worth to you.
Make sharing easy
Customers won't write their own messages. Give them a ready-made invite they can send with one tap, and remind them at a natural moment, for example right after they collect a stamp.
Mention the program at the counter, and announce it with a campaign when you launch it.
Summary
- Reward both the inviter and the new customer
- Give the bonus only after the first real purchase
- Keep the bonus small compared with the full card
- Block obvious abuse: existing customers, duplicate accounts, old invites
- Give customers a ready-made invite to share