Why B2C Referral Programs are so important for E-commerce Businesses

Around 4.57 billion people are active and are using the Internet. It is approximately 60% of the world’s population. No wonder why the Internet has also become a channel for doing business. People find the Internet as a helpful tool in their business. Some use it for marketing and advertising, and some use it for buying and selling goods and services. Due to this, E-commerce was developed and introduced. (Image source)

But what is E-commerce? E-commerce, also known as electronic commerce, is the act of electronically or digitally purchasing and buying, selling products, or even offering services online through the Internet. Also, it is a business transaction where sellers and buyers communicate through the Internet. This transaction involves buying or selling goods and availing or rendering services.

The five companies below are the most successful e-commerce business in the world:

Alibaba, or Alibaba Group Holding Limited, is a Chinese multinational technology company that specializes in e-commerce and retail, with a gross merchandise value (GMV), trailing twelve months (TTM) of greater than $768 billion.

Amazon, or Amazon.com Inc., is an American multinational conglomerate company which concentrates on e-commerce, cloud computing, digital streaming, and artificial intelligence, and is based on Seattle. It has a GMV (TTM) of $239 billion.

JD.com, also known as JD.com Inc. or Jingdong, and formerly known as 360buy, is a Chinese company that is one of the largest B2C online retailers in China, located in Beijing. The company’s GMV (TTM) amounts to $215 billion.

eBay, or eBay Inc., is an American multinational e-commerce corporation, that centers on C2C, consumer-to-consumer, and B2C, or business-to-consumer through its website. It has a GMV (TTM) of $93 billion.

Shopify, Shopify Inc., is a Canadian multinational e-commerce company, which focuses on online stores, and retail point-of-sale (POS) systems. Shopify’s GMV (TTM) amounts to $33 billion.

What do businesses get from e-commerce? What are the advantages of e-commerce? Through knowing its benefits, you will more likely know why your referral programs are necessary for them.

Advantages of E-commerce

E-commerce makes people reach other people. It provides a global reach. Through eCommerce, you can break the gap, whether it may be the distance between your company and your customers. Your company and your customers will have the chance to meet and communicate in the virtual world.
E-commerce is cost-saving. It saves your company from spending too much on your fixed costs like rent and other utilities. And since your company is not spending more than what is needed, you will enjoy a higher profit.

E-commerce is highly convenient. Your customers can visit your website anytime at any place. They can shop easily and address their concerns in the most uncomplicated way they can. E-commerce provides trouble-free communication with customers. Customers can directly message you regarding their concerns, feedback, suggestions, and even complaints.

Anything has both advantages and disadvantages. So, what does E-commerce has that will be a little threat to you?

Disadvantages of E-commerce

1. Starting an E-commerce business needs high capital. You need to purchase equipment, train employees, and maintain your inputs.

2. If not handled properly, the E-commerce business has a high risk of failure.

3. E-commerce business has security problems. There are tons of online theft cases nowadays, wherein, there are cases of stolen customer information, credit card theft, and identity theft.

When we talk about e-commerce, people think that it is the purchase of goods and services by using the Internet. However, there are different ways to know the type of online transaction customers are engaged in by identifying the e-commerce category the transaction falls.

There are six basic types of e-commerce. Those are:

• Business-to-business (B2B)
• Business-to-consumer (B2C)
• Consumer-to-consumer (C2C)
• Consumer-to-business (C2B)
• Business-to-Administration (B2A)
• Consumer-to-Administration (C2A)

However, we will focus more on B2C or business-to-consumer category.

Business-to-consumer, or B2C, is the most common, typical, and known e-commerce category because it deals with the virtual relationship between your business and your consumer. B2C also talks about the strategies your company does to promote their products and services to people. It involves selling and promoting your products and services to your customers. If you like your B2C marketing to work, you must watch the trends closely, research customer purchase behavior, and monitor your competitor’s strategies.

How does B2C Marketing help in your referral programs, and why is it essential for eCommerce businesses?

Customers love recommending products and services that they are satisfied with their friends, families, colleagues, and other loved ones. Referral marketing and developing your referral programs are an opportunity to monetize your customers’ recommendations and increase your leads. Here are the reasons why B2C referral programs are necessary for e-commerce business.

Reasons why B2C Referral Programs are essential for E-commerce businesses


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B2C Referral Programs fit into your social media strategy.

E-commerce and social media are like partners. Every e-commerce business must develop its social presence. You can gain some benefits from a well-established social presence. These are what a well-established social presence gives you. It gives your company a personality. Once you developed your social presence, your customers can easily recognize your brand.

It leads to sales. Social presence is also one way of letting other people who do not know your company yet see what your company is. Reaching out to new customers leads to sales. It makes your company visible to the eyes of your ‘not yet’ customers. Your social presence speaks of your products and services as well. A well-established social presence allows prospective customers to see your company’s products and services in a way they never saw before.

You can add a sharing button to your company’s posts and content, so your customers will find it easier to share the news with their family, friends, and others. Most of the people nowadays cannot get their hands off their phones, tablets, laptops, and computers, so using social media in your B2C referral programs has a high success rate.

B2C Referral Programs are easy to start.

Your company and your customers already share something in common, and that is your products or services. You develop your products or services, and they buy or experience it. Therefore, B2C referral programs are easy to start because you already established a connection between you and your customer.

One advantage of e-commerce is that it is highly convenient. Having B2C referral programs is also practical. You do not need to search for people to recommend your products and services because you already have people to support. You only need to incorporate your referral programs virtually.

B2C Referral Programs help in your email marketing.

B2C Referral programs allow you to know your customers and how to approach them. Your marketing strategies through the use of email will make more sense and will help your eCommerce business. By knowing your customers more, you do not need to send promotional emails to random people because you have classified the recipients of your email marketing program. Since recipients of your email are existing customers, they already had the idea of your products. So, receiving an email regarding a referral program that includes discounts, freebies, bonuses, or rewards will make them feel motivated to refer a friend, family, or colleague.

B2C Referral Programs allows you to know not just your customers, but also your patronizers.

Your customers will recommend your products or services to a friend or two while some customers will recommend it to more than three people. Of course, one or two referrals are significant and valuable in the business because it will still increase your sales. But, through your B2C referral programs, you will identify your customers who are consistently giving you referrals. These customers are highly significant in your business because they are your patronizers and advocates. They are satisfied customers willing to share your company’s products and services to others online or even offline.

Make sure that your referral programs will work, find these satisfied and happy customers with a high social presence, and communicate with them. These customers are not aware that they are influencers, for they lead others to certain things or ways, and can high up your sales and profit. When you reach them, express your gratitude by sending them bonus points, rewards, freebies, or discounts for their support and referrals. By doing so, your customers will feel loved, cared, and valued by the company and will continuously recommend your products and services to others, which will multiply your company’s referrals.

B2C Referral Programs are time-efficient and cost-effective marketing tactics.

Marketing your products and services is one of the most expensive and time-consuming parts of the business. Developing B2C referral programs will eliminate your cost in paying social advertisements or creating a blog. But this B2C referral programs will help you consume time, and save money by looking at what is already present – and that is your satisfied customers. These satisfied customers are the ones who are very much interested in your company’s products and services, who will do most of your marketing tasks for you – through referrals.

Once these customers recommend your products, you will spend less on your marketing programs since somebody is already promoting the company’s products and services. Their referral and recommendation will also allow you to save more time and will allow you to focus on thinking about ways on how to improve and develop your products and services more than marketing them.

B2C Referral Programs result in good reviews about the business.

People love to write a review of a company’s products and services once they feel something about it, whether they feel satisfied or dissatisfied. These reviews are essential, especially in an e-commerce business. Why? People tend to doubt an online product because they think of the quality, the material used, or the totality of the product. However, when people read a review of your company’s products and services, they will have the idea of what your products and services are and whether it is worth buying.

Satisfied and dissatisfied customers of your company’s products and services will make a review of it, and this review is the ones newcomers will read. It will be their basis whether they will buy your company’s products or not. A satisfied customer who will recommend your company’s products and services will speak positively about it. Because of this, it will lead to good reviews, and people who have not tried your products or services will tend to buy or experience it.

B2C Referral Programs lead to customer retention.

An e-commerce business needs to have consistent customers. By developing a successful B2C referral program, customers tend to stay with the company, keep on buying products, or experience the services. When your customers refer a friend, or a family member, a co-worker, or a loved one, it is because they enjoyed your product or service, and it is more likely that they will buy more or experience more.

However, give your customers a reason to return. This reason may be in the form of rewards, bonuses, and discounts, for it will make them feel excited to come back and shop. Through your referral programs, both your company and your customers benefit from participating in it.

B2C Referral Programs develop trust.

In an e-commerce business, trusting a company is quite hard to do, and it is a disadvantage of having an e-commerce business. However, your referral programs are significant instruments in developing the trust of your customers. People prefer to believe the recommendations of a trusted source, a long-time customer, or a patronizer. People referred to your business have more likely developed their trust in your company since they have recommended your company.

Because of referrals, your company has now established a higher trust rating.

Business-to-consumer or B2C Referral Programs fit and help in your social media strategy, and are easy to start. They help in your email marketing and allow you to know your patronizers. They are time-efficient and cost-effective and result in good reviews. They lead to customer retention and develop trust in your e-commerce business.

Whether you plan to target B2C or B2B companies, you will need referral software if you are to implement a referral program in your business. You need to check that it works for you. You may need to install a WordPress affiliate plugin for this. This is what Hunting Bow Labs did which sells the fastest crossbows and they found that it doesn’t only help with acquiring customers but also for building a network of eCommerce affiliates.


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