A ‘referral fee’ for your influencers?
Oh, please no. The idea of brands rewarding consumers financially or otherwise through a mainstream digital platform for promoting products to friends just gives me a knee-jerk reaction of PLEASE NO. We all survive in some way, shape or form off of the recommendations of friends and colleagues. Do we really need to now develop a marketing platform that claws at the authenticity of the consumer driven referral?
According to the blog post…
Foursquare founder Dennis Crowley reportedly thinks the next big development in social networking will come from algorithms that can determine how influential recommendations or updates are based on the response they garner from others. “Once that happens, [Crowley] said, marketers will be able to reward the most influential users for mentioning them,” reports Forbes’ Mixed Media blog. If, for instance, your movie endorsement – via Twitter, Facebook, or another social platform — drives ticket sales at Fandango.com, “You should get some kind of referrer’s fee,” Crowley said during a panel discussion this week. “I bet that exists within a year. There will be some way for you to get kickbacks.” Forbes, however, suggests that recently created Federal Trade Commission guidelines governing paid endorsements on blogs and social media sites will stifle Crowley’s vision. “They could well prevent Foursquare and other tech companies from developing new features many of their users would undoubtedly welcome,” writes Forbes. Undoubtedly? First, we’d hope that such features would offer social “influencers” comparable “kickbacks” for saving us from an awful movie.
Yes, it’s extraordinarily tempting. Hey, the consumer tells a friend about a cool product or service and they get rewarded for that – good deal for all, huh? But the reality is that it never actually works that way. Brands typically don’t pay what these consumers would feel is fair (this has been done many times before)… and furthermore, all this does is add a new layer of speculation in recommendations online and everywhere else – “are they getting paid by telling me this information?” This is exactly why the FTC jumped on this topic a while back.
The basic idea of rewarding pass along for new customer acquisition has been around for ages and, in a controlled way, feels authentic. Successful word-of-mouth at the end of the day lives and dies with the value of the offering – not a marketing platform. Right now, gajillions of consumers are sharing their opinions of brands with friends – I’d venture to say they would say, “keep the nickel you were going to give me for telling a friend and put it towards making the product I already love, even better.”
Maybe I’m wrong.
(1 votes, average: 4.00 out of 5)
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Damian, I think you’re really on to something here. I’d add this:
What I’ve learned is that while people don’t want to sell out their friends, they do like to be rewarded for something they’ve done. If they feel they’d be doing it for the money (unless it’s BIG money), they don’t want to do it. (There are exceptions of course. About 1% of people are happy to “sell” to their friends constantly.)
So taking the idea from “I’ll pay you if you do this” to “thanks for doing that. Here’s a token of our appreciation” makes a difference in the mindset of the consumer.
If the customer thinks they’re doing it FOR the money, very few will do it. On the other hand, most people like the idea of getting at least a token reward.
If a ticketing system could allow patrons to extend ‘offers’ to their social networks using unique qualifiers or bar codes, this could actually be an interesting idea. But it would probably have to pitched as more of a social event organizing tool than a ’sell us to your friends and we’ll pay you’ scheme.
The codes would have to trace back to the account that generated the referral, the sales activity that resulted from the referral codes would have to be recorded to the referring account, and then points or cash would have to be credited to the referring account. I can’t think of anything that would make this impossible, but it’s probably beyond the capabilities of most ticketing systems.
I used to balk at these incentive programs but given the rise of social media and the trend toward small social groups, the right technology could make this an incredibly effective sales tool.
It’s an idea that’s been around for decades. Errr. Well, a couple.
When I was at Berkeley Rep in the 19##s (oh so long ago) I began a campaign to solicit renewing subscribers to give us five names of friends we could solicit for season tix. The promo was a big hit, for one reason: the reward was a chocolate chip cookie. Berkeley Rep’s cookie vendor was famous for the most delicious choc chip cookies EVER. People would turn in five first born for one of those cookies. I would too, at the time. But the campaign lasted only a few seasons before people opened up the phone book.
At A.C.T. I tried the same thing. Different prize: contest, first prize xmas dinner with the actor playing Scrooge. Results, pretty good. Not spectacular. Worth the clever promo.
The cookie won hands down. Lesson learned: bake really good cookies.
Love all of these points. I totally agree on the point of valuing a consumers contribution to your brand through incentives… I just know it’s very hard for brands to effectively poke around in consumer-to-consumer interaction without coming off sleazy.
If I were to hedge my bets; I would say the future landscape of incentive marketing will increasingly be painted with shades of gray as it evolves.. for better or worse.
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