The $10 Billion Referral Marketing Campaign

You already know how powerful word-of-mouth marketing can be, but can you imagine building a large client base 100% founded on referrals? It’s possible! Just look at what Dropbox accomplished in just over a year with their ingenious referral marketing campaign.

referral marketing

Lost In The Cloud

referral marketingDropbox is a cloud-based file storage service that securely holds everything from paperwork to photos to videos.

When Dropbox was released in June 2007, they were one company among dozens providing a cloud storage solution. Dropbox needed to create a market while fighting off heavy competition, and they needed to do it quickly.

The problem was that Dropbox already had a massive cost-per-new-customer issue. When they launched, it was costing them between $233 and $388 per new customer — nearly triple the $99 price tag of their actual product.

 

Referral Marketing Ingenuity

Dropbox is a venture-backed tech startup. From the beginning, they’ve had millions of dollars at their disposal. They had endless marketing opportunities, but they chose to use a referral marketing campaign.referral marketing

The plan was two-sided. A customer could refer someone to Dropbox, and if the referral picked up any of its services — including its free service — both the customer and their referral would receive an extra 500MB of storage.

Dropbox then hired a referral expert. This person created marketing surveys, tracking, and tools customers could use to encourage friends and family to sign up.

The campaign was a massive success. In the first 30 days, current users of Dropbox’s service sent 2.8 million referral invites. Thirty-five percent of Dropbox’s daily sign-ups came from their referral program. Twenty percent came from other viral features, like shared folders.

Under The Hood

referral marketingAt first glance, Dropbox’s strategies seem obvious. But when you look at how they were executed, you see the devil is in the details. New customers were given the opportunity to invite their friends to join Dropbox, in return for more cloud storage space.

Dropbox put customers first by making the referral process simple. First, they used social media as a key sharing platform. Then, they gave customers a visual tracker to show how much progress they’d made with their referrals.

Most importantly, Dropbox maximized their ability to bring new clients on board by putting much of their marketing efforts into this referral campaign, and they engaged with these clients in a symbiotic way.

Finally, the 500MBs of extra storage given to referrers encouraged further use of the Dropbox platform. See what they did there?

When It Comes To Referrals, The Newsletter Pro Has You Covered

referral marketingIt’s time to take a look at your marketing strategy. Pay attention to how much effort you’re putting into gaining referrals. Is it more or less effort than you’re putting into other marketing campaigns? Get down to the nitty gritty, and pin it down to a specific number. Compare that to the ROI you have with other marketing campaigns.

Referrals are the cheapest and best sources of new customers any business can access, but most businesses get very few referrals each month. You need a system to get referrals, and that means you need to create a referral culture.

So hey, why not take the first step? Give The Newsletter Pro a call today at 208.257.5700 for a consultation. We’re the premiere referral marketing gurus. We’ll give you indispensable info, and we’ll explain how newsletters can work with your current marketing efforts. We look forward to chatting with you!

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