At Referral Factory, we believe that every single business in the world should have a referral program. And a SaaS (Software as a Service) business is no exception! In fact, referrals work really well in SaaS businesses as has been proven by early adopters like Dropbox, Canva, and Airtable. In this post, we’ll discuss why every SaaS business should have a referral program and how it can significantly boost your growth. Then, we’ll go through the SaaS Referral Program checklist step-by-step so you don’t need to reinvent the wheel to understand what works and what doesn’t when it comes to SaaS referrals. Plus, we’ll take you through just how easy it is to get a referral program up and running using referral marketing software like Referral Factory, which even integrates with Stripe to automate referral tracking and issue credits or coupons as rewards for successful referrals!
The Benefits of a SaaS Referral Program
Lower Your CPA
Referral marketing turns your existing customers into a marketing channel. It’s a performance marketing channel where you only pay AFTER a user/lead/customer has converted. Essentially, successful referral programs lower customer acquisition costs, giving you more value for your expenses. Instead of pricey ad placements, your sales team can get creative with your referral or loyalty program.
Increase Your Conversion Rates
Referred leads are 2x more likely to convert than leads acquired through paid marketing channels. Why? This is because referrals from friends are trusted more than any other source.
Get More High-Value Customers
Users that a friend has referred are more valuable. In fact, referred users spend 13.2% more on average than other users. Moreover, there is an increased customer retention among users coming from SaaS referral programs, which provides you with a higher customer lifetime value.
Phase 1: Planning Your SaaS Referral Program
The key to building a successful referral program for SaaS begins with a clear referral marketing strategy. Start by determining how you want your referral program to work, decide on referral rewards and incentives, and nail down the critical details, like what a successful or converted referral means for your business.
Here are four items to add to your SaaS referral program checklist for the planning phase:
✅ Choose The Right Type of Referral Program
While there is nothing at all wrong with the classic “Refer a Friend” strategy, don’t neglect to consider other referral program types. The “Refer to Win” model introduces a competitive edge, rewarding participants with incentives like prizes, discounts, or exclusive access based on the number or impact of their referrals. This strategy often drives more leads and can create a lot of hype when you’re trying to gain exposure for a new SaaS. Another option is to try a “Jump the Waitlist” referral program, which creates a sense of exclusivity, allowing users to skip queues or gain early access by referring others. What you choose depends on your SaaS and where you are in your customer acquisition journey.
For more ideas on the different types, browse through Referral Factory’s templates, which you can quickly and easily customize to get a referral program up and running in a matter of hours. We even have a template, especially for SaaS referrals.
✅ Decide What Constitutes A Successful Referral
It’s pretty standard to only reward referrers for successful or converted referrals and what constitutes success is really up to you. Whatever that conversion moment is, it will determine your call-to-action, your rewards (for example, if they’re worth the wait!), and how your referral program tracking works. So, before you start building your referral program, make sure you know what qualifies as a successful referral.
The great thing is that with referral marketing software like Referral Factory, you can automatically track converted referrals in a variety of ways:
👉 When a minimum spend is reached on Stripe via a no-code integration
✅ Reward the Referrer and the Friend
In referral marketing, we call this a double-sided or two-sided reward: where you reward the existing user for the successful referral AND you incentivize the friend being referred. This creates a win-win situation where both parties benefit from participating in the referral program. For example, you can offer a discount or credit to the referrer and a special offer or discount to the referred customer. Double-sided rewards don’t only result in a higher conversion rate, they also increase the number of referred leads. This is because customer referral programs work on the principle of reciprocity.
Learn more about best practices in this article: Referral Rewards: How To Choose Your Rewards And Calculate The Value.
✅ Reward in Your Own Currency
The great thing about referral programs in SaaS businesses is that you can probably reward and incentivize in your own currency. Consider offering exclusive access to premium features or subscription credits to both referrers and their friends. In addition to making referrals a very cost-effective lead generation strategy, rewarding in your own currency also fosters retention among your existing users.
With Referral Factory, you can fully automate the whole process of issuing referral rewards in your own currency with custom rules that you set. These can be issued via Stripe as credits or coupons to both the person referring and the friend or you can reward via webhooks straight into your SaaS product.
Phase 2: Building Your SaaS Referral Program
When it comes to building your SaaS referral program you’ll need to consider the user experience, the crucial aspect of referral tracking, as well as the nitty-gritty details that can easily be overlooked. If you’re looking to ask ambassadors and online celebrities to promote your saas too, then check out our article on influencer tracking here.
Here are two key items to put on your checklist when it comes to building your referral program SaaS:
✅ Optimize Your Referral Link Landing Pages
It should be pretty obvious that if you want people to refer their friends, you need to make the whole user experience as easy and seamless as possible. That’s why we recommend creating unique referral links for each of your users and making sure that these direct your potential new leads to an optimized landing page where they can find all the relevant information about your SaaS, their incentive for being referred, and how to take the next steps. These pages should also be personalized with the referrer’s name, which helps to further instill the trust that is crucial in referral marketing.
Want to see an example of your SaaS referral program? Try Referral Factory’s free referral link generator. All you need to do is fill in your website and AI will do the rest!
✅ Surface Referral Links In Your User Dashboard
Once you’ve created referral links for each of your users, make sure they can access that link right from inside your logged-in dashboard, portal, or app. This means recommending your SaaS to friends becomes a breeze – no need for users to figure out complex referral codes or navigate through confusing steps. By integrating this straightforward feature into the user dashboard, you’re putting user convenience front and center, making the referral experience easy and user-friendly. You should also add share buttons inside your users’ dashboards so that they can quickly share their links with friends.
Referral Factory offers several no-code options to issue referral links to your current customers. These include syncing your campaign with your CRM, and or using our referral widget or pop-up to surface links in a logged-in environment.
If you do an API integration with Referral Factory, you will have a lot more flexibility to show things inside your platform, including the following:
- A user’s referral link and share buttons
- A user’s analytics showing their reach, referrals, and referrals converted
- A leaderboard of top referrers
Phase 3: Promoting Your SaaS Referral Program
Once you have built your referral program, the next thing you need to do is promote it. Whether you use social media channels or build an email marketing campaign, the key is to engage with your target audience base.
The most important thing to keep in mind is that referral marketing is an ongoing process — the more people know about it, the more referrals you’ll get. In fact, referral programs that perform the best are ones that are frequently marketed.
Here are our top three tips that you can implement to promote your SaaS referral program.
✅ Launch Your Referral Program With a Bang
Build excitement and anticipation by creating a launch plan that includes social media posts, email campaigns, and other promotional activities. Consider offering exclusive early access or bonuses for the first users who participate in the program. This can create a sense of urgency and encourage people to sign up right away.
✅ Ask for Referrals at The Right Time
When it comes to asking for referrals, timing is absolutely critical. In addition to providing your users’ unique referral links inside your platform, consider explicitly marketing your referral program to them at key moments in their customer journey, such as immediately after they convert or upgrade and after a good experience with your support team.
✅ Give Social Proof that Referrals Work
We all know that people are more likely to do something if they see social proof that it works. Use testimonials, case studies, and success stories from your existing customers to show potential referrers the value and benefits of participating in your referral program. Highlight the results and rewards that others have received to build trust and credibility. You could even build a monthly competition into your referral program and reward your top referrers with shoutouts on social media.
For more strategies to promote your referral program, have a look at 10 Ways To Promote Your Referral Program
Top 10 SaaS Referral Program Examples (That You Can Copy)
Looking for inspiration to create an effective referral program for your SaaS business? Look no further! The following examples will provide you with valuable insights into how other companies have leveraged referral programs to drive customer acquisition and retention. Best of all, Referral Factory has created referral program templates based on each of these SaaS referral programs that you can copy for your own SaaS business!
Trello’s referral program is one of the best we’ve ever seen. As one of the most prominent B2B SaaS platforms around, Trello streamlines the working process for both personal and professional tasks.
This is why they have a diverse customer base, and their brilliant referral program drives even more growth. When you successfully refer a friend to Trello, you’ll get 1 free month of Trello Gold, which is the platform’s paid plan.
Most importantly, the referred user will also get 1 free month of Trello Gold, making it easier for current users to get referrals using their custom link.
👉 You can use Trello’s referral program as a template for your very own SaaS referral program here.
As one of the B2B SaaS companies that offers file hosting services, the Dropbox referral program is something to be recommended. In this SaaS referral program, a qualified referral will earn both parties an additional 500MB in storage space.
And wait, there’s more: you can rack up the referrals because Dropbox allows you to earn up to 16GB in free storage. If you’re using Dropbox on your mobile devices, this heap of additional storage is such a lifesaver.
It’s a simple, straightforward referral program, but it did lead to a massive 3900% growth for the platform. Dropbox succeeded in giving out a reward that directly addresses the needs of its customers, which resulted in increased brand recognition.
👉 You can use Dropbox’s referral program as a template for your very own SaaS referral program here.
In today’s age of digital multimedia, Canva stands at the top as a dynamic graphic design platform. They also have one of the best SaaS referral programs around, mainly because it speaks to the direct needs of their users.
Canva’s referral program allows both parties to earn a Canva Credit, which they could use to get free premium photos, icons, and illustrations. This is one of the SaaS referral examples that are simple but very effective.
👉 You can use Canva’s referral program as a template for your very own SaaS referral program here.
Fiverr’s referral program operates on a tiered system, where users can earn rewards based on the number of referrals they make. When a user refers someone to join Fiverr, they receive a referral link that can be shared via email, social media, or other channels. If the referred user signs up using that link and completes their first purchase, both the referrer and the referred user receive a reward, such as Fiverr credit or a discount on future purchases.
The results of Fiverr’s referral program have been impressive, with a significant increase in user acquisition and engagement. By incentivizing users to refer others, Fiverr has successfully tapped into the power of word-of-mouth marketing, expanding their customer base and driving more transactions on their platform. This referral program has not only helped Fiverr grow but has also created a sense of community among its users, fostering loyalty and encouraging ongoing participation in the platform.
👉 You can use Fiverr’s referral program as a template for your very own SaaS referral program here.
Evernote’s referral program is designed to reward both the referrer and the referred user. When an existing Evernote user refers a friend to sign up for Evernote, they receive points that can be redeemed for premium features or account credit. The referred user also receives points upon signing up, incentivizing them to try out Evernote.
These points can be accumulated and used to unlock additional features or extend the duration of their premium subscription. With this win-win approach, Evernote encourages its users to spread the word about their platform while providing added value to both the referrer and the referred user.
👉 You can use Evernote’s referral program as a template for your very own SaaS referral program here.
Airtable’s referral program is designed to reward users for referring new customers to the platform. When a user refers someone to sign up for Airtable and that person becomes a paying customer, both the referrer and the referred user receive a credit towards their subscription fees. The referral program is facilitated through unique referral links that users can share with their network.
The results of Airtable’s referral program have been highly successful in driving customer acquisition and increasing user engagement. By incentivizing users to refer others, Airtable has been able to tap into the power of personal recommendations and word-of-mouth marketing. This has not only helped Airtable expand its user base but has also created a strong community of advocates who actively promote the platform. The referral program has proven to be a win-win, providing benefits to both the referrer and the referred user, while fueling the growth of Airtable as a leading SaaS platform.
👉 You can use Airtable’s referral program as a template for your very own SaaS referral program here.
Expensify’s referral program operates on a simple and straightforward mechanism. When a user refers someone to sign up for Expensify and that person becomes an active user, the referrer earns a cash reward. The referral program is facilitated through unique referral links that users can share with their network via email, social media, or other channels.
The results of Expensify’s referral program have been highly successful in driving user acquisition and increasing brand awareness. By incentivizing users to refer others, Expensify has been able to tap into the power of personal recommendations and word-of-mouth marketing. This has not only helped Expensify grow its user base but has also created a loyal community of advocates who actively promote the platform. The referral program has proven to be a win-win, providing financial incentives to referrers while expanding Expensify’s reach and market presence.
👉 You can use Expensify’s referral program as a template for your very own SaaS referral program here.
Swagbucks’ referral program operates on a straightforward mechanism that rewards users for referring new members to the platform. When a user refers someone to join Swagbucks and that person signs up and starts earning points, the referrer receives a percentage of their referred friend’s earnings for life. The referral program is facilitated through unique referral links that users can share via email, social media, or other channels.
The results of Swagbucks’ referral program have been highly successful in driving user acquisition and engagement. By incentivizing users to refer others, Swagbucks has been able to tap into the power of personal recommendations and word-of-mouth marketing. This has not only helped Swagbucks grow its user base but has also created a vibrant community of users who actively promote the platform. The referral program has proven to be a win-win, providing ongoing rewards to referrers while fueling the growth and success of Swagbucks as a leading rewards platform.
👉 You can use Swagbucks’ referral program as a template for your very own SaaS referral program here.
FreeAgent’s referral program operates on a simple and effective mechanism. When a user refers someone to sign up for FreeAgent and that person becomes a paying customer, both the referrer and the referred user receive a discount on their subscription fees. The referral program is facilitated through unique referral links that users can share with their network.
The results of FreeAgent’s referral program have been successful in driving customer acquisition and increasing user engagement. By incentivizing users to refer others, FreeAgent has been able to tap into the power of personal recommendations and word-of-mouth marketing. This has not only helped FreeAgent expand its user base but has also created a sense of community among its users, fostering loyalty and encouraging ongoing usage of the platform. The referral program has proven to be a win-win, providing benefits to both the referrer and the referred user, while contributing to the growth and success of FreeAgent as a leading accounting software.
👉 You can use FreeAgent’s referral program as a template for your very own SaaS referral program here.
#10 Referral Factory
That’s right — it would be crazy to run a referral marketing SaaS and not practice what we preach. Referral Factory’s referral program rewards referrers with $200 for every converted customer. A referral is only counted as converted when the client you refer to us takes out a subscription and pays for at least two months.
If you know someone who might be interested in Referral Factory, you can register for a referral link here. Or if you’re interested about finders fees and partner programs, you can keep an eye on our YouTube channel.