7 Surprising Stats about Customer Referral Programs
Below are 7 surprising stats about customer referral programs. If you already have a customer referral program and it's not performing like you want, you could also title this 7 reminders that you're on the right track and don't give up.
There is plenty of anecdotal evidence that people use to show that customer referral programs work. These stories are used to show the power of customer referral programs because humans are able to share stories easily. In fact, we actually have some great pieces on our blog from ShoeBoxed, GoSquared, FreeAgent, and TeamPages that tell the stories about how their customer referral programs have worked.
However, if you're like me, at some point you want some concrete evidence based in statistics and science to back up these great success stories. So, I went ahead and put together a collection of real data from research groups to put some numbers behind customer referral program success.
Now, these findings won't give you all the answers to how exactly to build the best referral program, however, they will give you some idea of how effective a referral program could be for you when done right.
Ok, here it is...
65% of new business comes from referrals - New York Times
92% of respondents trusted referrals from people they knew - Nielsen
People are 4 times more likely to buy when referred by a friend - Nielsen
Non-cash incentives are 24% more effective at boosting performance than cash incentives - University of Chicago
Offering a reward increases referral likelihood, but the size of the reward does not matter - American Marketing Association
The LifeTime Value of a new referral customer is 16% higher - Wharton School of Business
83% of consumers are willing to refer after a positive experience—yet only 29% actually do - Texas Tech
So Now What?
Check out our latest referral marketing infographic that highlights exclusive referral marketing performance benchmarks.