I've had quite a few conversations in the past year with businesses that want to start experimenting with viral marketing. Many of these businesses hesitate to jump in because they think of viral marketing as some complex marketing task that requires tons of time and planning. In their minds, a good viral idea is a complex viral idea. That's not necessarily true. In fact, the creative use of a "refer a friend" type feature can serve as an excellent basis for a viral marketing campaign.

This very concept popped up today in Chad White's column over at MediaPost Publications.

In his post, White talks about the different way that three companies utilize a "refer a friend" feature on their site. One of the three companies is a high-end retailer that takes the time to offer both a well-drafted email and that also offers a monetary incentive that can tough NOT to pass on.

Blue Nile sends a substantial HTML email with links to gifts in different price ranges, links to shipping, gift card and returns information, and a banner that includes links to different product categories. Blue Nile's is also the only one of the three to offer the friend a personal code that's good for a discount of up to $100 (depending on how much they spend)--and if the friend cashes in the discount, then the referrer is sent a code good for the same discount. It's a smart way to incentivize newsletter subscribers to refer their friends, and the friends to take advantage of the referral discount and try out a retailer with which they may be unfamiliar.

The Blue Nile example is a good one.

CafePress, the popular "you design it, we ship it" customized clothing shop takes a similar, albeit less expensive route. When shoppers complete their purchase they are offered the chance to send $5 coupons to up to five friends. If the shopper sends along those emails, they get their own $5 coupon for their next purchase as well.

A good business knows their customer acquisition cost (CAC). Based on that, it wouldn't be hard to come up with a financial incentive that puts you ahead of the game and to offer it to your customers so that they can do your marketing for you.

Simple. But it works.

Keep in mind that these types of ideas don't have to be limited to e-commerce stores or even to online. Restaurants and coffee shops are a great example of companies that could use refer-a-friend both online an off.

Let's say you run a local restaurant and that you have a web site. It would be pretty easy to set things up so that someone visiting your web site can forward your menu (or something else about your site) to a friend. You could even go a step further and offer a deal that says "Suggest us to a friend and the appetizer is on us." Then send both the friend and the person at your site a coupon via email for a free appetizer with the purchase of two entrees. (Or whatever other deal you want.) A coffee shop might offer a free small coffee with the purchase of a muffin...again, just figure out your CAC and make an offer that has a monetary value that's lower.

As I said, these offers don't even have to take place online. There's no reason that you can't keep a stack of coupons like that laying around your restaurant. If a customer tells the wait staff or a manger how much they enjoyed their meal, give them a few of these coupons and ask them to share them with friends (while keeping one for themselves of course.)

Generating buzz isn't difficult and it doesn't have to be expensive. Stop worrying about living up to all those multi-million dollar viral campaigns that are put together by mega-corporations. Come up with something that fits within your budget, but guarantees a higher return on investment than other marketing options." Test it out. It wouldn't surprise me if a small restaurant would see a higher ROI from a printed out coupon than M&M's saw on their "Become an M&M" campaign.

Discuss this article in the Small Business Ideas forum.

January 18, 2007

Jennifer Laycock is the Editor of Search Engine Guide, the Social Media Faculty Chair for MarketMotive and offers small business social media strategy & consulting. Jennifer enjoys the challenge of finding unique and creative ways to connect with consumers without spending a fortune in marketing dollars. Though she now prefers to work with small businesses, Jennifer’s clients have included companies like Verizon, American Greetings and Highlights for Children.

Search Engine Guide > Jennifer Laycock > Simple and Affordable Viral Marketing - Refer a Friend