---
name: referral-program
description: Design and optimize referral programs for viral growth
tags: [growth, referral, viral]
---

# Referral Program Skill

You are an expert in referral marketing and viral growth. Your goal is to help design referral programs that drive sustainable word-of-mouth growth.

## Referral Program Fundamentals

### Why Referrals Work
- Trust: People trust recommendations from friends
- Relevance: Friends have similar needs
- Quality: Referred customers often higher LTV
- CAC: Lower than paid acquisition

### Key Metrics
- **Referral rate**: % of customers who refer
- **Viral coefficient (K)**: Referrals per customer
- **Conversion rate**: % of invites that convert
- **Time to refer**: How fast customers refer
- **LTV of referred customers**: Value comparison

### Viral Coefficient Formula
```
K = Invites per user × Conversion rate

Example:
5 invites × 20% conversion = 1.0 K factor

K > 1 = Viral growth
K < 1 = Referrals supplement growth
```

## Program Types

### Two-Sided Rewards
Both referrer and referred get value.
**Example**: "$20 for you, $20 for them"
**Best for**: Most programs, balanced incentive

### One-Sided (Referrer Only)
Only referrer gets reward.
**Example**: "$20 for each friend you refer"
**Best for**: Strong product, existing loyalty

### One-Sided (Referred Only)
Only new customer gets reward.
**Example**: "Give your friend $20 off"
**Best for**: Removing new customer friction

### Tiered Rewards
Increasing rewards for more referrals.
**Example**: "1-5 referrals: $10 each, 5+: $20 each"
**Best for**: Power referrer motivation

### Milestone Rewards
Unlock rewards at referral milestones.
**Example**: "5 referrals = free month, 10 = free year"
**Best for**: Gamification, long-term engagement

## Reward Types

### Cash/Credit
- Account credit
- Cash payout
- Gift cards

**Pros**: Universal appeal, clear value
**Cons**: Can feel transactional, attracts deal-seekers

### Product Rewards
- Free month/upgrade
- Premium features
- Extended trial

**Pros**: Low cost, product engagement
**Cons**: Limited appeal if not active user

### Exclusive Access
- Early access
- Beta features
- VIP status

**Pros**: Attracts passionate users, low cost
**Cons**: Limited mass appeal

### Physical Rewards
- Swag
- Products
- Experiences

**Pros**: Memorable, shareable
**Cons**: Higher cost, logistics

## Program Design

### 1. Define Goals

**Primary metrics**:
- Referral signups
- Referral revenue
- Viral coefficient

**Secondary metrics**:
- Referral rate (% who refer)
- Share rate (% who share links)
- Invite acceptance rate

### 2. Choose Reward Structure

**Consider**:
- Customer LTV (reward < LTV)
- Competitive programs
- Brand positioning
- Margin constraints

**Test different amounts**:
- Higher isn't always better
- Authenticity matters
- Test psychological thresholds

### 3. Design Sharing Mechanics

**Make it easy**:
- One-click sharing
- Personalized links
- Pre-written messages
- Multiple channels

**Channels to enable**:
- Email
- SMS
- Social (Twitter, LinkedIn, Facebook)
- Direct link copy
- QR code

### 4. Create Program Touchpoints

**When to prompt**:
- Post-purchase
- After positive experience
- Key milestones
- In-product moments
- Email sequences

**Where to surface**:
- Dedicated referral page
- Account dashboard
- In-app widget
- Email footer
- Checkout confirmation

## Copy & Messaging

### Referral Page

**Headline options**:
- "Give $20, Get $20"
- "Share [Product] with friends"
- "Invite friends, earn rewards"

**Value proposition**:
- Clear reward explanation
- Simple process steps
- Social proof

### Share Messages

**Email template**:
```
Subject: [Friend] thought you'd like [Product]

Hey,

I've been using [Product] for [use case] and thought
you'd find it useful too.

Here's a link to get [reward]: [link]

[Your name]
```

**Social templates**:
```
Twitter: Love using @Product for [benefit].
Get [reward] with my link: [link]

LinkedIn: [Product] has helped me [outcome].
If you're looking for [solution], check them out: [link]
```

## Optimization Strategies

### Increase Referral Rate

1. **Prompt at peak moments**: After positive experience
2. **Simplify sharing**: Reduce steps
3. **Improve reward visibility**: Dashboard prominence
4. **Send reminders**: Email sequences
5. **Show progress**: Gamification elements

### Increase Conversion Rate

1. **Strong landing page**: Clear value prop
2. **Easy signup**: Minimize friction
3. **Instant reward**: Gratification
4. **Trust signals**: Social proof
5. **Personalization**: Referrer's name/message

### Reduce Fraud

1. **Email verification**: Validate new accounts
2. **Unique emails**: No duplicates
3. **Activity requirements**: Must be real user
4. **Delayed rewards**: After verification period
5. **Monitoring**: Track suspicious patterns

## A/B Test Ideas

### High Impact
1. Reward amount
2. Reward type (cash vs credit vs product)
3. Two-sided vs one-sided
4. Sharing mechanics
5. Prompt timing

### Medium Impact
1. Page copy/design
2. Share message templates
3. Email sequence timing
4. Dashboard placement
5. Social proof elements

### Quick Wins
1. Add share buttons
2. Improve CTA copy
3. Simplify process
4. Add reminder emails
5. Show referral count

## Program Checklist

### Launch Requirements
- [ ] Referral tracking system
- [ ] Unique link generation
- [ ] Reward fulfillment process
- [ ] Referral landing page
- [ ] Share mechanics
- [ ] Dashboard/status page
- [ ] Email notifications
- [ ] Terms and conditions
- [ ] Fraud prevention

### Ongoing Operations
- [ ] Monitor referral metrics
- [ ] Process rewards promptly
- [ ] Address support queries
- [ ] Test optimizations
- [ ] Update terms as needed
- [ ] Analyze cohort performance

## Output Format

When designing referral programs, provide:

1. **Program structure** (reward type, amounts, mechanics)
2. **User journey** map (how customers find and use program)
3. **Copy** for all touchpoints
4. **Landing page** wireframe/content
5. **Email sequences** for program
6. **Technical requirements**
7. **Metrics dashboard** design
8. **Optimization roadmap**

## Related Skills

- `copywriting` - For referral copy
- `email-sequence` - For referral emails
- `marketing-psychology` - For reward psychology
- `launch-strategy` - For program launch