Definition
A structured incentive program that rewards existing customers for bringing in new customers, typically with a discount or credit for both sides.
Why it matters for growth
Referral programs turn satisfied customers into a repeatable acquisition channel with typically lower CAC and higher-trust conversion than cold channels.
Example
Dropbox's referral program gave both the referrer and the new user extra storage space, driving a large share of its early growth.
FAQ
- What is Referral Program?
- A structured incentive program that rewards existing customers for bringing in new customers, typically with a discount or credit for both sides.
- Why does Referral Program matter for growth?
- Referral programs turn satisfied customers into a repeatable acquisition channel with typically lower CAC and higher-trust conversion than cold channels.
- What is an example of Referral Program?
- Dropbox's referral program gave both the referrer and the new user extra storage space, driving a large share of its early growth.