Let’s take a look at the four most common types of referral programs along with examples to help you visualize your next referral program.
1. Single and double-sided instant rewards
As their name implies, double-sided reward programs reward both the promoted and the referred friend. Most companies use dollars of credit as reward, but other incentives, such as a discount, a gift card, subscription time or points are also used.
The dollar credit is the most appreciated though, with 50% of the promoters and 53.8% of the referred friends mentioning this as the most popular reward type.
A 2020 industry report showed that most users expect referral programs to offer double-sided rewards, which was the most popular choice among the surveyed companies as well.
Then we have single-sided reward programs, where only the referred person receives an incentive. Both the single and the double-sided rewards are typically instant rewards, meaning that the customer receives the credit, money or gift upon using the referral link or code.
The reward is offered immediately, so this type of program works great when you can offer perks at a low cost. For example, you can offer free downloads, access to certain product features, upgrades, discounts or small physical rewards.
Instant rewards examples
Instant rewards are used across all industries, making it the most popular and the most likely strategy to lead to happy customers. The typical amount offered by companies is $10 to the referrer and $10 to the referred friend, although these amounts may vary depending on the company. For example, Lyft offers $5 in ride credit to users who refer a friend, but the amount can vary depending on the city.