Accelerated growth through incentive-less referrals

There's a lot that goes into making a high-performing referral product. Yesterday, I spoke about a unique way in which we approached referrals at The Ken

You must have noticed an "Invite Friends" feature in the apps you use every day. With paid advertising making customer acquisition prohibitively expensive, referrals allow businesses to get high-quality customers at a fraction of the cost.

Surprisingly, most referral programs miss important tricks and rely heavily on incentives.

In this session, I set up a framework for referral products. And then I go on to explain how The Ken's "Gift a story" product does it. How we managed to accelerate subscriber growth through incentive-less referrals.

Transcript

1. ACCELERATED GROWTH THROUGH INCENTIVE-LESS REFERRALS @mananbharara
2. REFERRALS ARE NOTHING BUT A WAY TO ENCOURAGE HAPPY CUSTOMERS TO SPREAD WORD ABOUT THE PRODUCT IN ORDER TO ACQUIRE NEW CUSTOMERS
3. Most trusted form of advertising. The second most trusted form of advertising is not even close WHY REFERRALS ARE ALL THE RAGE
4. Most trusted form of advertising. The second most trusted form of advertising is not even close WHY REFERRALS ARE ALL THE RAGE
5. It’s cheaper to acquire customers through referrals. And these customers retain better WHY REFERRALS ARE ALL THE RAGE
6. YOU MUST’VE SEEN OR USED A REFERRAL PROGRAM THEY ALL LOOK QUITE SIMILAR
7. • Reward • Timing • Place • Convenience • Incentive BECAUSE GOOD PRODUCTS HAVE IT DOWN TO A SCIENCE
8. • Reward • Timing • Place • Convenience • Incentive BECAUSE GOOD PRODUCTS HAVE IT DOWN TO A SCIENCE
9. • Reward • Timing • Place • Convenience • Incentive BECAUSE GOOD PRODUCTS HAVE IT DOWN TO A SCIENCE
10. ✓Reward ✓Timing ✓Place • Convenience ✓Incentive BECAUSE GOOD PRODUCTS HAVE IT DOWN TO A SCIENCE
11. ✓Reward ✓Timing ✓Place ✓Convenience ✓Incentive SOME PRODUCTS HAVE IT DOWN TO A SCIENCE
12. ✓Reward ✓Timing ✓Place ✓Convenience ✓Incentive SOME PRODUCTS HAVE IT DOWN TO A SCIENCE
20. We are a 3 year old media company that publishes one original, insightful long- form story every weekday Our stories are about technology, startups, and healthcare INDIA’S FIRST SUBSCRIPTION- DRIVEN MEDIA COMPANY
21. OVER THE YEARS, WE’VE CONSISTENTLY WRITTEN STORIES THAT MATTER
22. OVER THE YEARS, WE’VE CONSISTENTLY WRITTEN STORIES THAT MATTER
23. MOST STORIES ARE BEHIND A HARD PAYWALL AND ARE FOR SUBSCRIBERS ONLY The cost of reading a single story is Rs. 590/-
24. WE BEGAN DEFINING A REFERRAL PRODUCT FOR THE KEN FEB 2019
25. PAID SUBSCRIBERS 10,000 ORGANICALLY ADDED, THROUGH WORD-OF-MOUTH
26. WE UNDERSTOOD HOW THESE WORD-OF-MOUTH REFERRALS WERE BEING COMMUNICATED Direct, 36.21%
27. WE UNDERSTOOD HOW THESE WORD-OF-MOUTH REFERRALS WERE BEING COMMUNICATED Story pages Non-story pages Story pages Non-story pages Direct, 36.21%
28. AND WE VALIDATED OUR UNDERSTANDING
29. PAYWALLS ARE VALUE-LIMITING
30. PAYWALLS UNLOCK VALUE
31. EMBRACING BEHAVIOUR IS MUCH EASIER THAN CHANGING IT
32. WE KNEW WHAT OUR REFERRAL REWARD HAD TO BE
33. WHY YOU DON’T NEED INCENTIVES FOR REFERRALS
34. OR HOW VALUABLE PRODUCTS CAN USE SCARCITY TO DRIVE REFERRALS
35. Scarcity value is an economic factor describing the increase in an item's relative price by a low supply
36. MARKETING SCARCITY IS COMMON “60,000 people joined the waiting list when Superhuman launched on Product Hunt. We want what’s exclusive” “Sent via Superhuman is a status signal and virality trigger. Raising demand while limiting supply boosts the scarcity ratio” “Superhuman can throttle growth by turning the faucet and letting more people in. The more they limit access, the more cachet surrounds the tool” https://druriley.com/superhuman-marketing-playbook-9-strategies-19-examples/#0-scarcity-marketing Feb
38. WE EMPHASISE SCARCITY VALUE THROUGHOUT THE PRODUCT Gifting, not sharing. Gifts are valuable
39. WE EMPHASISE SCARCITY VALUE THROUGHOUT THE PRODUCT Gifting, not sharing. Gifts are valuable
40. Gift credits are available to paid subscribers only. One credit allows a subscriber to gift one story WE EMPHASISE SCARCITY VALUE THROUGHOUT THE PRODUCT
41. Gift credits are available to paid subscribers only. One credit allows a subscriber to gift one story WE EMPHASISE SCARCITY VALUE THROUGHOUT THE PRODUCT
42. You can request more credits, but they’ll come at a cost WE EMPHASISE SCARCITY VALUE THROUGHOUT THE PRODUCT
43. You can request more credits, but they’ll come at a cost WE EMPHASISE SCARCITY VALUE THROUGHOUT THE PRODUCT
44. Gift credits are individually trackable. And if unused, retrievable WE EMPHASISE SCARCITY VALUE THROUGHOUT THE PRODUCT
45. Gift credits are individually trackable. And if unused, retrievable WE EMPHASISE SCARCITY VALUE THROUGHOUT THE PRODUCT
46. Gifts are beautiful. And it feels great to receive a gift WE EMPHASISE SCARCITY VALUE THROUGHOUT THE PRODUCT
47. OVER 20% OF NEW SUBSCRIBERS GIFT STORIES WITHIN THE FIRST MONTH OF JOINING WITH ZERO INTERVENTIONS
48. EXCLUSIVITY & SCARCITY SERVE AS ENOUGH INCENTIVE TO DRIVE REFERRALS
49. BUT THAT’S NOT ALL, IS IT? REMEMBER TIMING, PLACE, AND CONVENIENCE?
50. WHAT IS THE RIGHT TIME TO ASK SOMEONE TO REFER?
51. Chamath Palihapitiya - how we put Facebook on the path to 1 billion users
53. ALLOWED US TO BUILD A HABIT
54. ALLOWED US TO BUILD A HABIT THROUGH TRIGGERS
56. ALLOWED US TO BUILD A HABIT
57. ALLOWED US TO BUILD A HABIT
59. SUBSCRIBERS WHO GIFT ONE STORY ARE 65% MORE LIKELY TO GIFT ANOTHER WITHIN THE SAME MONTH COMPARED TO SUBSCRIBERS WHO DON’T
60. ALLOWED US TO BUILD A HABIT
61. ALLOWED US TO BUILD A HABIT
63. SO, IN SHORT • Understand where your users find value. Your product's Aha moment is often the best place to drive referrals from • You don’t need material incentives to get subscribers to refer. A combination of scarcity, exclusivity, and habit formation worked for us at The Ken. A different combination can work for you • It all quickly falls apart if it’s not convenient
64. Thanks! @mananbharara