MarTech Podcast: Word-of-Mouth, Positive Reinforcement, and Loyalty Loops
We’re excited to have SaaSquatch CEO and Co-Founder Will Fraser join host Benjamin Shapiro on the MarTech Podcast. The MarTech Podcast tells the stories of world-class marketers who use technology to generate growth and achieve business and career success.
In this three-part series, Will and Ben dive into the scaling and tracking of word-of-mouth, how to use positive reinforcement in marketing, plus loyalty loops and how they drive growth.
If you’ve ever wanted to learn how to leverage the power of word-of-mouth marketing for your brand, check out all three episodes below:
- Part One: Scaling and Tracking Word-of-Mouth
- Part Two: The Use of Positive Reinforcement in Marketing
- Part Three: Growth and Loyalty Loops
Part One: Scaling and Tracking Word-of-Mouth
Listen on Apple Podcasts, Spotify, Google, or Overcast.
While many marketers understand the power of word-of-mouth, customer referrals are often viewed as an “untrackable, uncountable thing”. But with the right tools, approach, and value proposition, referral marketing can quickly become your top acquisition channel.
In this first episode, Will shares his top tips for getting more referrals, and making sure you can easily track their effectiveness against your growth.
Listen to the full episode above, and check out our show notes for the top takeaways:
How do you get more referrals (without annoying your customers)?
Will prefaces the episode by saying whether or not you believe in the ability to track customer referrals, you should still be asking for them:
“For all those brands who are getting word-of-mouth without any kind of specific program or initiative, you’re only getting about ¼ of what you should be getting if you were actually pushing your program forward and asking for referrals.”
So, what’s the right way to ask for customer referrals?
- Make it easy for them to refer: Place the referral experience in front of what your customers are already doing so you can make it compelling and easy to participate in.
- Offer real value: Will shares that “a well-done referral program is actually seen as a feature by your customers”. Your referral program should provide a compelling offer that encourages users to share your value with others.
- Ask at the right time: The best referral programs are seamlessly weaved into the organic customer experience, and prompt users to refer when they are the happiest and most excited about your product.
Top tips for tracking your referrals and word-of-mouth
Once you’ve launched a referral program that is effective and easy for the customer to use, you need to know how to measure its impact. No matter what kind of referral platform you’re using, use these tips to get a clear understanding of how referrals are helping you grow:
- Give people direct ways to share: Make it easy for customers to share their codes with a direct communication method (ie. SMS, Messenger) for the most effective results.
- Make it easy for referrals to happen verbally: Equip users with referral codes and links that are easy to share on the fly. For example, codes based on a user’s name are easy to pass on without needing to dig through their profile.
- Look for a solution using first-party cookies: With new browser regulations around the use of third-party tracking cookies, using a system that utilizes first-party cookies will significantly help your tracking abilities and let you attribute each referral.
Bonus Tip: Track beyond just the referral conversion! For the best ROI, pay attention to what types of customers are referring the most profitable or most engaged new users. For example, are referrals from a specific segment of customers only driving free-trial users? Is another segment referring new users with a high lifetime value?
With this information, you can identify your top referrers, work to build relationships with them, and make sure the referral program is fitting their needs.
What kind of businesses are seeing success with a referral and loyalty solution like SaaSquatch?
Will shares that significant value can be derived from a managed referral and loyalty solution like SaaSquatch by businesses with complex customer journeys. For example, business models in SaaS, subscription services, marketplaces etc, whose customers follow a path with free trial, adoption, and customization stages have a great opportunity to market more inside their product with referrals and rewards.
Many of these newer, digital-first business models have yet to invest in marketing to their existing customers to drive loyalty and advocacy. But with multiple customer touchpoints they can leverage more than just a traditional referral program, but also reward users’ preferred behaviors with tailored loyalty programs to engage customers.
Part Two: The Use of Positive Reinforcement in Marketing
In this second episode, Will and MarTech host Benjamin Shapiro discuss the use of positive reinforcement in your marketing messages. Learn how and why you should surprise, delight, and reward your customers to strengthen your retention efforts and boost ROI.
Listen to the full episode above, and check out our show notes for the top takeaways:
The power of positivity
Will and Ben both agree that positivity makes a difference. Think back to the last time you had a wonderful customer service interaction - Whether the waiter left you a chocolate at the end of your meal, or the customer support rep gave you an exclusive discount, you appreciate the positive dopamine hit and will remember the experience and want to re-engage with this company again.
How do you build positivity into your marketing efforts?
When it comes to your marketing efforts, adding positivity can be as simple as thanking your customers. Start by looking at the customers who you want to bring back, and the key behaviors that you want to drive.
For example, when customers are renewing their contracts or subscriptions, use the opportunity to thank them for being loyal and even add a small token of appreciation. This gives you a chance to attach a positive outcome to a behavior (ie. renewal) that you want to keep encouraging.
What’s the ROI of being generous and appreciative of your customers?
While some businesses worry about saving every possible dollar when giving gifts or showing appreciation, it’s still cheaper to sell to and retain an existing customer.
“For us we see huge retention rates, and upsell rates within companies that have this positive behavior. It will be different per business but generally speaking, saying thank you always brings back more.”
Just remember, a token of appreciation doesn’t need to break the bank: “It’s not that you gave me a $500 gift card, it's that you gave me anything.”
What’s the benefit of using positive reinforcement?
While a lot of marketing departments are addicted to acquisition and the idea of getting more new customers, positive reinforcement means looking inwards finding the key drivers of your business’ success: what do you need customers to keep doing in order to be profitable and grow?
Positive reinforcement is key to helping you strengthen customer habits. A user performs an action (ie. purchases, renews), they receive a reward, and the next time they’re prompted to repeat the action they’ll automatically associate a positive outcome with it and be more willing to complete it.
Part Three: Growth and Loyalty Loops
In our third episode of the MarTech Podcast, SaaSquatch CEO and Co-Founder Will Fraser and host Benjamin Shapiro discuss driving growth with loyalty loops.
Listen to the full episode above, and check out the show notes for the top takeaways:
What is a loyalty loop?
The idea of a loyalty loop means identifying the key actions you want someone to take inside your product or service (ie. logging in x times, using a feature, renewing), and how you will get them to do it again.
“Loyalty loop is all about what is the key behavior that you’re trying to drive, how are you going to engage that customer to do that again, and what are you going to give them as a reason to complete that loop.”
What are the different types of loyalty loops?
Traditional loyalty loops have been focused on the checkout process, as that was often the only customer touchpoint that companies could track.
Today, modern businesses can focus on a much broader range of activities from product usage, spending habits, and out-of-app activities. You have the opportunity to encourage behavior that 10 years ago was simply untrackable, and create loyalty loops that drive users through every stage of your customer journey and not just the checkout.
How do loyalty loops drive revenue?
- Encourage collection of user information: When you use loyalty loops to encourage users to fill out their profile, customize their settings, and specify their preferences, the better you can tailor your offerings and product recommendations for increased revenue.
- Encourage profitable behavior: Use loyalty loops to encourage the actions that directly drive revenue like subscription renewals, and long-term contract agreements.
By experimenting with your loyalty offers and gauging customer reception, you can gain insights into the preferences of your profitable customers, and tailor your acquisition strategies to attract more of your best users.
Special thank you to Benjamin Shapiro for having us on the show! Check out more MarTech Podcast episodes here.