How to use User Referrals for driving Growth?
Situation:
Complication:
Objective:
Specific Questions:
A leading online clothing retailer has implemented a user referral program. While the program has seen initial success, its effectiveness has plateaued. The marketing team aims to analyze and optimize the referral program for better results.
Complication:
Recent data indicates a decrease in user participation in the referral program. Challenges include low awareness among potential referrers, declining referral actions, varying user quality, and potential fraud risks.
Objective:
The goal is to revitalize the user referral program, focusing on increasing awareness, improving participation rates, ensuring high-quality user acquisition, and mitigating fraud.
Specific Questions:
- Question I: Which key metrics should the retailer analyze first to understand the current performance and challenges of its referral program?
- Question II: Given that only 10% of the customer base is aware of the referral program, what targeted strategies could the retailer implement to boost program visibility?
- Question III: How can the retailer redesign its incentive structure to increase referral actions, especially among users who have shown interest but have not referred yet?
- Question IV: What methods can the retailer use to evaluate the LTV of users acquired through referrals and compare it to other acquisition channels?
- Question V: What specific fraud detection and prevention strategies should the retailer introduce to ensure the authenticity and integrity of the referral program?