Referrals Make Money for Companies

Josh October 6, 2014

Some people have asked why we would have a site that lets people share referral bonuses. What is the incentive for us and for the people that use it? Well Forbes recently had a great article about referral marketing from the perspective of the business. I cut a little except out and put it below.  You can read the whole article if you want to but basically it says that people that are more likely to sue a product that someone they know refers them to and people are more likely to refer a product if they are financially incentivised. So how does sharethebonus play in this?  Our thought process is that when you are signing up for your gas company or a new cell phone provider at 1130 at night you are not going to think to ask your friends what gas company they are using. And you don’t feel like scrolling through asinine twitter feeds to find some strangers referral code. That is where we plain in this.  Whenever people want to see if there is a referral code for something they can just type it in the search bar on the top of our page.  It is either in there or it is not.  In fact that is why we designed the site the way we did. I wanted a person to be able to come to the site and only have to spend about 10 seconds to find what they want. No one has to sign up for anything. No one has to search through a forum. Just type in the thing you want a referral code for, click on it, and follow the directions. Look as you can see in the Forbes article they are getting their money. Why don’t you get yours.

From the article:

Straight Talk About Word-Of-Mouth Marketing

If your hair stylist gave you $10 every time you sent one of your friends her way, you might be more tempted to tell all of your buddies what a fabulous stylist she was–or you might even try to make new friends to refer. This clever method of customer acquisition is a form of word-of-mouth marketing known as a referral program. While such programs have been used for decades by not-for-profit organizations like PBS, similar customer referral programs have also become increasingly popular with companies in a wide range of industries, from financial services and automobiles to newspapers and hotels. Christophe Van den Bulte, a professor of marketing at Wharton, describes customer referral programs as an effective way to attract higher quality customers. “They are an old idea that’s getting more traction these days,” he notes, “and we now have solid evidence of their financial benefits.”

According to a new study titled “Referral Programs and Customer Value” (to be published in the January 2011 issue of the American Marketing Association’s Journal of Marketing), customer referral programs are indeed a financially attractive way for firms to acquire new customers. The study–authored by Van den Bulte, Bernd Skiera and Philipp Schmitt, a professor and doctoral student, respectively, at Goethe University in Frankfurt, Germany–was conducted over a period of three years and followed the customer referral program of a leading German bank (which remained anonymous) that paid customers 25 euros for each new customer they brought in.

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