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Does your referral strategy need refining?
Great ad strategies employ techniques that are as diverse as the target audience. Most marketers aren't focused on a single persona but several. It makes a lot of sense then to use different tactics to appeal to your potential customers. Tactics to consider as part of a diverse strategy are those that create demand.
"Smaller, emerging brands tend to be more focused here than larger, established brands for the simple reason that they have to be. Awareness campaigns tend to be harder to justify. Bigger brands, meanwhile, tend to be more focused on harvesting demand, which explains their focus on search," said Matt Roche, CEO, Extole. " You buy ads against search queries by people who already know you or have a need. It's a longer cycle from awareness to intent to acquisition. At the same time, Facebook wants you to build a big social presence so that you can then buy ads targeted to your fans. Those are harvesting activities not demand creating."
According to Roche changes are coming in the way brands approach acquisition. He says that bigger brands, especially, are looking at how smaller brands use a focused approach to engage and are mimicking that on their own scale to increase growth. Referral marketing is one area where that change is the most marked.
"Referral marketing creates demand by encouraging your existing customers to share your brand or products with their friends. Your customers, often using very personalized messages, end up connecting you with potential customers who may not even know you exist. Through gifts or incentives delivered at conversion, referrals become a scalable customer acquisition channel. It's something marketers can directly control, measure, and optimize which makes it very powerful - so powerful that's it's becoming the next channel for customer acquisition," said Roche.
According to Roche only about 22% of Internet Retailer 500 brands have adopted referral programs. Just over half of the 300 financial services brands they surveyed had programs.
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