(Source: https://pltfrm.com.cn)
Introduction
Customer acquisition is essential for growth, but retaining those customers is equally crucial—especially in China’s competitive eCommerce market. Referral programs not only attract new customers but also strengthen the loyalty of existing ones. With the right approach tailored to the Chinese market, brands can build sustainable and scalable customer retention strategies. Here’s how to structure a referral program that ensures success.
1. Design Referral Rewards That Align With Customer Preferences
1.1 Focus on Value-Based Incentives
Chinese consumers respond well to tangible rewards. Offer high-perceived-value incentives like cashback, vouchers for future purchases, or exclusive product samples. A skincare brand in China saw a 30% increase in retention by offering gift sets for customers who referred three friends.
1.2 Offer Tiered or VIP Benefits
Create a sense of exclusivity with tiered benefits for loyal referrers. For instance, after five successful referrals, customers could access a “VIP zone” with limited-edition products or exclusive sales, enhancing the appeal of continued engagement.
2. Integrate Referrals Into Popular Chinese ECommerce Platforms
2.1 Tap Into Tmall and JD.com Features
Platforms like Tmall and JD.com allow brands to embed referral programs directly into their online stores. This ensures a seamless shopping experience and reduces friction for customers. By integrating referral links into their Tmall storefront, a beverage brand increased referral-driven sales by 25%.
2.2 Collaborate With Social Commerce Channels
Red (Xiaohongshu) and Pinduoduo thrive on community-driven shopping. Enable referral rewards that can be redeemed when friends purchase through these platforms, creating a network effect that promotes virality.
3. Leverage KOLs and KOCs to Amplify Your Referral Campaign
3.1 Collaborate With Key Opinion Leaders (KOLs)
KOLs can create buzz around referral programs by endorsing them in authentic, relatable ways. For example, a tech accessories brand partnered with a popular lifestyle KOL to promote their referral campaign, resulting in a 40% uptick in app downloads.
3.2 Empower Key Opinion Consumers (KOCs)
KOCs, often everyday consumers with small but trusted networks, are highly influential in driving referrals. Incentivize KOCs with personalized rewards for sharing your brand with friends, creating grassroots advocacy.
4. Streamline the Referral Experience for Users
4.1 Simplify Participation
Minimize barriers to entry by ensuring that referral processes are simple and quick. Features like one-click sharing to WeChat contacts or QR codes for offline sharing can significantly increase participation rates.
4.2 Provide Clear Tracking and Transparency
Allow users to track their referral rewards in real-time. A dashboard showing progress toward rewards increases motivation to continue participating. A food delivery app saw higher engagement when they introduced real-time tracking for rewards in their Mini-Program.
Case Study: A Food Delivery App’s WeChat Referral Program
A leading food delivery platform in China launched a referral campaign via its WeChat Mini-Program. Customers earned 20 RMB credits for each successful referral, with no limit on how many friends they could invite. To encourage retention, referred customers received free delivery for their first three orders. The campaign’s success was evident: within three months, referrals accounted for 50% of new user sign-ups, and customer retention rates improved by 35%.
Conclusion
Retention-focused referral programs are essential for long-term success in China’s eCommerce market. By offering compelling rewards, leveraging popular platforms, and optimizing user experience, brands can ensure sustained growth and customer loyalty.
PLTFRM is an international brand consulting agency that works with companies such as Red, TikTok, Tmall, Baidu, and other well-known Chinese internet e-commerce platforms. We have been working with Chile Cherries for many years, reaching Chinese consumers in depth through different platforms and realizing that Chile Cherries’ exports in China account for 97% of the total exports in Asia. Contact us, and we will help you find the best China e-commerce platform for you. Search PLTFRM for a free consultation!
