The Importance of Referral Programs for Web Apps

Kazuki

Hatched by Kazuki

Sep 01, 2023

3 min read

0

The Importance of Referral Programs for Web Apps

Referral programs have become a crucial aspect of marketing strategies for many web apps. The reason behind this is simple: people are more likely to use a product if it has been recommended to them by a friend or colleague. In addition to increasing user acquisition, referrals also help decrease both the overall customer acquisition cost and cost per lead, particularly for those who are running ads.

If you're wondering how to build a successful referral program for your web app, here are some useful tips to consider. Firstly, use internal currency as a reward for successful referrals. This internal currency can be in the form of credits, points, or any other virtual currency that your users can accumulate and use within your app. By offering this as a reward, you are incentivizing users to not only refer your app to others but also to continue using it themselves.

Secondly, make the referral program a part of your onboarding process. When users first sign up for your app, introduce them to the referral program and clearly explain the benefits they can receive by referring their friends. By incorporating the program into the onboarding process, you are ensuring that users are aware of it from the start and are more likely to participate.

Thirdly, make sharing easy. Place your referral program somewhere that's immediately visible to users, such as the main dashboard or a dedicated section within your app. Additionally, optimize the sharing process by providing pre-populated messages or social media posts that users can easily share with their friends. The easier the sharing process is, the more likely your users are to share their referral links with others.

Now, let's shift our focus to the unlikely journey of Pinterest, one of the most successful startups in recent years. Pinterest's founders, despite not being prodigies, managed to build a product that eventually became huge. However, it wasn't an overnight success. In fact, when Pinterest first launched, no one liked it. The team faced challenges in terms of funding and struggled to gain traction in the market.

Ben, one of the founders, had previously worked at Google before joining Pinterest. After launching the app, it took four months for Pinterest to reach a mere 200 users. The growth in the early stages was slow, but steady. Ben recalls, "The site grew by the same percentage (40%-50%) every single month. It’s just that the number started so low that it took a while to get going."

What's remarkable about Pinterest's journey is that they stuck to their original vision despite the pressure from Silicon Valley to pivot or admit failure. They remained committed to their product and community. Ben even went above and beyond by personally reaching out to the first 5,000-7,000 people who joined the site. This level of dedication and obsession with their product ultimately paid off, as Pinterest is now a household name.

The story of Pinterest serves as a great example for startups and entrepreneurs. It shows that success doesn't happen overnight and that sticking to your original idea can lead to great things. It's important to stay focused, be passionate about your product, and go that extra mile to connect with your early users.

In conclusion, building a referral program for your web app can significantly contribute to its success. By using internal currency as a reward, incorporating the program into your onboarding process, and making sharing easy, you can encourage your users to refer their friends and increase user acquisition. Additionally, the journey of Pinterest reminds us of the importance of staying true to our vision, being obsessive about our product, and building a strong community. These actionable tips, combined with dedication and perseverance, can pave the way for long-term success in the startup world.

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