What is your SaaS referral incentive?
Hi IndieHackers,
We're looking into setting up a referral program for simplebackups.io and I was wondering what incentive you were offering to the referrer?
Are you giving back a % of your monthly fee, or a one time fixed amount?
And how do you evaluate what is the right amount to give back?
Any common practice ?
Thanks !
Hi Laurent,
First of all, what's your target audience for this program? Is it your customers or external partners/influencers?
If your customers are the main target, giving a free month or discount might be a good enough incentive. You can also use double sided rewards and also give something for the person referred, making it more appealing.
If your main focus is external partners and affiliates(aka affiliate program), monetary commissions are usually the best option. This is my preferred choice for startups because they have a very low customers base and a good influencer can boost the sales considerably.
At FirstPromoter, we have hundreds of clients that use both, a campaign for existing customers and a campaign for affiliates with different rewards.
However, to get started a % recurring commission between 20 to 40% seems to be the most appealing for both external affiliates and customers, based on the data we have. Another good approach is to give a higher first month % and a bit lower recurring commissions(like first month 50% and 20% next months until user cancels). Higher quality affiliates are harder to get, especially if your product is new and not trusted enough, so for them you might need to provide a better deal than the rest.
As a final note, most startups have very high expectations from these type of programs and if you haven't found "product-market fit" yet, I don't recommend launching one until your product and funnel is doing good on its own.
Thank your for this clear answer!
We are indeed still testing the market, and validating if we have a "product-market-fit". The thing is that in order to validate that point we need more users, users we can then talk to and get the feedback from.
That's also why we're looking into setting up an affiliate program so that we can broader our user base quicker and learn quicker from them.
I've worked with quite a few very early stage startups and the best approach is to find a few influencers and convince them to promote your product, either to their email list, blog or both.
Try giving them 1 year free subscription + good commission per sale and also something to their audience(discount, longer trial, etc).
I don't want to discourage you, but unless you focus enough resources on the affiliate program, mostly recruitment, you won't see results very soon. Waiting for affiliates to come won't move the needle, you are either committed or postpone the affiliate program until you are more prepared and the product/messaging is on point.
That's why at FirstPromoter when very early stage startups sign up we ask them if they already have some influencers ready to promote the product, otherwise we encourage them to wait a bit more even though we may lose a few customers. Many of them came back a year later and kicked ass with their affiliate program.
Hey,
We have an affiliate program and we give an ongoing 10% commission. It means the referer will receive 0.1 of each purchase done by his users.
We have contacted some influencers (mostly bloggers) in our niche, some wrote a blog post reviewing our product and some of them could earn a good amount of money so far.
We set 10% because it is almost the biggest amount we can offer which is still safely profitable for us.
I’ve been looking into some options lately:
give 10% - 30% recurring commission for 1 - 2 years
give an equal amount of $ that referred spent to use on your app
give X amount of $ to spend on your app for every referral
give X amount of credits for each referred
What works best for you, depends on your product and its customers.