Is referral marketing worth it and why is so powerful? We speak to Peter Rowe, CEO of Soreto on the channel developments, mechanics of the platform and its relationship with influencers and sharable content.
Peter, firstly, tell us about Soreto and your background in referral marketing?
PR: Soreto is an exciting addition to the referral marketing and social sharing technology space. It was co-founded by my predecessor and dear friend Nicky McShane, who as one of our industry’s most progressive and exuberant marketers, sadly passed away at the end of last year. She was passionate about the opportunity that Soreto represents and I’d been following its development with interest. I wasn’t aware of anything similar in the market, certainly in the affiliate channel, and was excited to help take the company forward.
We’ve gone to market in the last few months and the response has been phenomenal with a number of blue chip retailers integrating now. We’ve also had amazing support from the networks and agencies who all got the concept straight away.
As a channel, why do you think referral marketing is so powerful?
PR: Trust in marketing is at an all-time low. Fake news, fake ads and fake traffic are all well-known and documented. Nielsen’s annual Trust in Advertising survey certainly reflected this but the one constant is people’s trust in recommendations and endorsements. The last survey showed 83% of respondents trust a recommendation. Match this with extensive research findings that reveal how a referred customer generally spends more, stays longer and is more likely to recommend a friend, and you can clearly see where the opportunity is for us as an industry to find a way beyond this mistrust.
I’m not saying that referral is new, after all, First Direct are the world’s most recommended bank and Uber and Dropbox have created multi-billion dollar companies by leveraging their existing consumers to win new ones.
What’s different now is how the referral works, how it can be processed and then, most importantly, tracked. With customer acquisition costs constantly increasing, it equally makes sense to try and encourage both a repeat purchase and a recommendation. For instance, at the point of purchase confirmation, when consumers are leaving the site, why not try to monetise before they go? This is where Soreto can work with brands to ensure they are successfully tapping into this burgeoning opportunity.
With social media growing and influencers producing more shareable content, do you see this relationship developing within referral marketing?
PR: Absolutely. Customers are now superpowers with their influence and reach a whole new currency for us to work with. Consumers who are sharing their recommendations are the brands’ micro influencers and through our app, we can encourage them to amplify their sharing within their social media networks. It also works well for larger influencers as they can utilise our tracking technology to earn commissions by sharing products, offers and brands with their followers.
Do you have any tips for retailers looking to use and implement the channel?
PR: It’s very easy to set up a referral campaign but it does require a little bit of work to really see the benefits. There are a few things to consider:
Incentive – this is (obviously) a key one. There’s a lot of psychology here so tread carefully. Many retailers will simply want to offer their generic 10% off – the deal that they use across their own marketing. This might work but is hardly the incentive you need when a consumer is positively promoting your brand to friends with the same offer they can get for nothing in return. Instead, think of these consumers as valuable ambassadors for your brand and reward them accordingly.
Messaging – as with AdWords or Facebook ads, it’s important to try different messaging and creative. It can make a big difference. Soreto’s platform has full split testing so it’s easy to try different ads and offers.
Sharing platforms – Soreto enables sharing across all the major messaging and social platforms but that doesn’t mean you should necessarily use all of them. Some brands work differently across each channel so it’s important to consider a broader marketing strategy that taps into the different nuances of different platforms and allows brands to connect with consumers in different ways. To show this in action, one of our clients, New Look, embeds all of its hashtag campaigns into our sharing messages to help amplify its broader social campaigns.
It’s all pretty straightforward stuff but to ensure brands are getting the most out of their referrals, Soreto has customer success managers to advise clients at each step on how best to optimise their campaigns.
Could you run through the mechanics of the Soreto platform?
PR: We are aiming to achieve two things – firstly to bridge the gap between social media, messaging platforms and e-commerce and secondly, to harness the power of word of mouth. Soreto’s technology achieves both in a simple, trackable and scalable way.
In real terms, we create customised lightboxes that appear at various touch points on an e-commerce site, which encourages existing users to share a positive message about the brand in return for some form of incentive. For retail, this typically means a discount off their next purchase. Any friends who see their recommendation on social media will then also receive a discount when they purchase.
For sites such as travel, energy and telecoms, and those that don’t have the same level of frequent purchase, gift cards are offered. We can also run competitions and we have some exciting ideas about running influencer-based competitions that in themselves become highly effective social media campaigns.
The real beauty of the platform though is that it’s super customisable and configurable so will suit all retailers and their different requirements. The fact that we’re also fully integrated with all the networks and have the capability of running relevant container tags equally makes any tech integration unbelievably simple.
Lastly, what else is in the pipeline for Soreto for the rest of this year?
PR: Our focus on growth and reach. To cope with our rapid growth, we have a number of new team members starting, which will also help us with the extensive roadmap we have in place for the next 12 months.
Our technology is really providing a very different and unique solution for brands wishing to explore both the referral and social sharing sectors and a major milestone for us will come in the form of launching in Germany and France by the end of the year. We have a number of clients who want to implement Soreto in Europe so this makes total sense for us.