Why Referral Marketing Builds Ecommerce Brands Communities

It's not enough to just build a brand; you need to build a community. More and more, eCommerce brands are starting to wonder what is community marketing, and trying to build communities, tribes, private Slack servers or Discord channels or Facebook pages. Community marketing is effective - as you'll find out in this guestpost from eCommTips

By their very nature, referral programs are social. They run on word-of-mouth, friends referring friends. Consequently, referral marketing lends itself to communities and commuity marketing. It is powered by them and, for many ecommerce brands, referral marketing builds communities too.

There are myriad ways to use referral marketing to build your ecommerce brand community. Read on to discover exactly why you should build your community through referral marketing, with some examples of great ecommerce brands nailing Community-driven referral programs to show you how.

Referral marketing can create offline experiences that continue from online interactions

An ecommerce brand’s community rarely transcends the digital world. Sure, your customers will make referrals to people they know, but how often do they come together as a direct result of a referral? Answer: not all that often. 83% of customers are willing to make referrals, but only 29% actually do. So when a brand gets its customers together in the real world, it deserves to be applauded.

Activewear brand Athleta lets its customers customize their referrals with phrases such as “you’re my favorite workout buddy” and “let’s work out together”. This, in turn, encourages both the referrer and the beneficiary to share a real-world workout experience together (with some branded Athleta clothing). Similarly, Lululemon builds community through word of mouth by having retail stores host free yoga classes and run clubs, turning the store into hubs for conversation, fitness and community.

Lululemon store or yoga studio or community centre? All of the above.

Referral marketing isn’t limited solely to online experiences — it fosters both online and offline connections. By offering personalized referral programs, Athleta fosters an offline community of friends and new customers.

Takeaway tip: Your community of customers isn’t restricted to the online world. Encourage offline experiences to strengthen your customer base in the real world too.

Referrals incorporate a personal touch that creates strong ties that build communities

As consumers, we get discounts all the time, vouchers or offers from brands to help us spend more in-store. So when we get a discount from a referral program, it’s no big deal — unless it’s been personalized especially for us with some uplifting copy.

Enter outdoor goods brand The Clymb.

Adventure fans can send personalized referral messages to like-minded friends. This little touch increases signups by eschewing the generic branded messages and letting friends talk to friends — that’s what relationships are, building up to a community. It's also effective community marketing, bringing like-minded individuals into the Clymb community.

ReferralCandy has a nicer interface to allow your advocates to write their own social messages

Not only does The Clymb let you send ultra-personal referral messages to your friends and family, but it’s also beneficial for both parties. Both the referrer and the beneficiary receive the same discount off their next purchase — nice. Plus, it's a reason for them to strike up a conversation again in the future.

The best communities are those that are personalized, and Clymb knows the value of a personal touch. Referral marketing is, at its very essence, about people. And when you let people talk to people as people, it creates a genuine brand community.

Takeaway tip: Let your customers do the hard work for you and encourage them to send personalized invites to their friends and family. Potential customers prefer personal messages from people they over a generic marketing email any day.

No-one likes to feel as though they’re getting the raw end of a deal. When a referrer receives fewer rewards than their friend (or vice versa), they’re going to be a bit put out, and understandably so.

Consequently, a bum deal will see poor referrals, to the detriment of your online community. After all, why refer when it’s better to be referred?

Thankfully, apparel retailer Talbots place great emphasis on mutual benefits with its referral program. Customers of Talbots who refer their friends receive both a nice discount plus free shipping — exactly the same as what the invitee receives.

And because the referral invite emphasizes that each party wins, it creates a shared victory that strengthens that community vibe. It’s a win-win!

Takeaway tip: Mutual benefits increase referrals by ensuring neither party is left out in the cold. Offer referral incentives to both your referrer and the invitee, and you’ll build a strong community for your ecommerce brand. And like Talbots, make sure you make the win-win clear to your customers to hammer the message home.

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Matter Prints are another brand who succeeded through creating a strong community: read about the #MatterTribe and #pantstoseetheworldin.

Referral marketing emphasizes your customers as individuals - but as part of a community

Timberland is all about sharing the love. Every step of the outdoor footwear brand’s referral program highlights their community focus.

Firstly, Timberland doesn’t cap its invitee count. Whether you want to invite one friend or one hundred friends, it doesn’t matter. This makes your ecommerce brand’s community growth virtually limitless. Further to this, Timberland’s referral marketing materials feature photos of smiling friends under the heading: “it pays to have friends”.

FromTimberland's Refer-a-Friend page

Add to that some quirky copy — “Because you're one of my favorite people, I'm sending you this opportunity to get 20% off online at Timberland…” — and the brand’s customers really feel as though they’re part of something bigger.

There’s a lot of love in this referral program, and it shows. Appealing to your customers as individuals in your referral program makes them feel valued, deepening their affection for your brand and nourishing your growing community.

akeaway tip: Don’t just put customers first in your referral program — put people first. Emphasize the social aspect of referrals, and your customers will feel valued as individuals instead of just sales figures.

Why is building a community important?

For ecommerce brands, building a community does more than give you that warm, fuzzy feeling:

• It gives you a bank of loyal, repeat customers. These shoppers have an affinity for your brand, and so will return to you time and again.
• It provides you with a vital source of consumer insight. Who better to provide honest feedback on your latest product than a readymade focus group?
• It provides valuable social proof. Your community is locked into your brand, and they are only too happy to sing your praises online and offline.

And in the competitive world of ecommerce, a community is crucial. With such a low barrier to entry and relative affordability, the online business market is a saturated one. But look at any self-made online business and you’ll find that the most valuable ones (and those that turn the highest profits) are those that actively build their own unique community. Active mommy bloggers, vegan health advocates, tech-savvy millennials, eco-warriors — there is a target group for every niche online store, and there are so many different types of community.

Whether it’s through an active social media strategy or, as outlined above, savvy referral marketing programs, ecommerce brands experience higher growth and turnover as a result of their community.

Show me an ecommerce brand with a strong community behind it, and I’ll show you an online business on the path to success. As the examples above show, referral marketing and community-building go hand-in-hand. Follow the tips outlined here, and start growing your ecommerce community today.

Ecommerce Tips is an industry-leading ecommerce website that shares the latest insights from the sector: by entrepreneurs, for entrepreneurs. For everything from business growth hacks to product development, find the latest on Twitter @myecommercetips