Referral Marketing Statistics

JumpMD compiles original referral marketing research with public data to serve as a comprehensive statistical resource for journalists, researchers, and the curious public.
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by Jurgen Focken
May 23rd, 2024

Key findings

  • According to the Nielsen 2021 Trust in Advertising Study, 88% of people trust referrals from people they know over other advertising.
  • 86% of B2B buyers say that word of mouth is important for making purchase decisions.
  • Customers are four times more likely to buy when their friends refer them.
  • Over six years, on average, the lifetime value of referred customers was 16% greater than that of non-referred customers with comparable demographics and acquisition times.
  • Client retention rates are 37% higher for those referred by loyal customers over other methods.
  • Compared to leads obtained from other marketing methods, the conversion rate of referred clients is 30% greater.
  • 83% of satisfied customers are willing to refer someone.

B2B referral marketing statistics

The New York Times reports that referrals account for 65% of new businesses, while for 84% of B2B decision-makers, referrals are the first step in the purchasing process.

Compared to other marketing channels, B2B referrals bring the company 30% more revenue-generating leads.

Referral program statistics

According to the Heinz Marketing-Influitive survey, 59% of businesses using referral programs report having greater lifetime value clients, and 71% claim greater conversion rates.

Referral programs encourage word-of-mouth by offering rewards to current customers, partners, or business insiders for referring new customers or businesses.

78% of B2B marketers consider referral programs as a dependable source of high-quality leads.

Compared to other marketing channels, 54% of B2B marketers believe that referral programs are economical, yet efficient means of generating leads.

Word of mouth statistics

  • 88% of prospective clients of B2B companies look for word-of-mouth affirmation before making a financial decision regarding purchases from the company.
  • According to a survey conducted by The Zebra (2021), around 82% of small businesses say that word of mouth is their main or sole method of marketing.
  • When online word-of-mouth sources are taken into account, the percentage of B2B buyers who rely on word-of-mouth rises to 88% from 56%.

Online reviews statistics

According to a HubSpot report (2019), 75% of consumers don’t trust advertisements, yet 90% accept recommendations from friends and 70% believe in consumer reviews.

Recent research by Brightlocal (2024) indicates that 75% of consumers read online reviews, and 50% of consumers trust them just as much as personal recommendations.

Studies suggest that consumers often cross-reference the opinions expressed in online reviews as they are aware of influencer-endorsed content.

Challenges with getting referrals

  • Research by Texas Tech University reported that 83% of customers say they “would” refer someone, but only 29% of customers do so.
  • Referrals that seem unclear or more like advertisements are likely to be ignored by most consumers because they seem more intrusive rather than beneficial.
  • According to the Heinz Marketing and Influitive report, only 30% of B2B businesses have a structured referral scheme.

Referral incentive statistics

American Marketing Association reported that 91% of Americans would share special offers and discounts with friends and family, while more than 50% of people are likely to refer if offered an incentive or reward.

Some popular B2B referral rewards or incentives are:

  • Monetary compensation such as gift cards, cash, store credits, profit share, or commission
  • Exclusive benefits such as gifts, social recognition, free trials,
  • Special discounts on products or services
  • Charitable donations

For instance, HubSpot observed a 50% increase in lead generation by offering free products, gift cards, and charitable donations. On the other hand, rewards such as profit shares and commissions led to substantial revenue and sales growth for Shopify and Adobe.

References:

  1. Nielsen. “2021 Nielsen Trust In Advertising Sell Sheet.” Nielsen, Nov. 2021.
  2. Demand Gen Report. “Study: Word-of-Mouth, Industry Reports Greatly Impact B2B Buying Decisions.” Demand Gen Report.
  3. Schmitt, Philipp, et al. “Referral Programs and Customer Value.” Wharton School of the University of Pennsylvania, 2011.
  4. Murphy, Brandon. “Brand Advocacy and Social Media.” GMA Conference, 2009.
  5. Carlson, D. John. “83% of Customers Are Willing to Refer.” LinkedIn Pulse.
  6. Forbes Business Council. “Just Ask: The Power of Referrals.” Forbes, 2 Dec. 2021.
  7. The Zebra. “Small Business Statistics.” The Zebra.
  8. Volta Strategies. “The Referral Gap.” Volta Strategies Blog.
  9. Schmitt, Philipp, et al. “Referral Programs and Customer Value.” Wharton School of the University of Pennsylvania, 2013.
  10. i-Scoop. “Content Marketing Research Shows B2B Buyers Want Content.” i-Scoop.
  11. BrightLocal. “Local Consumer Review Survey.” BrightLocal.
  12. Talon.One. “Millennials vs. Baby Boomers: Consumer Behavior and How It Should Influence Your Promotions.” Talon.One Blog.
  13. ThinkImpact. “B2B Referral Statistics.” ThinkImpact.
  14. Roundel. “Gen Z Insights eReport.” Roundel, June 2023.
  15. HubSpot. “71% More Likely to Purchase Based on Social Media Referrals [Infographic].” HubSpot Blog.
  16. ReferralRocket.io. “Top 12 Referral Program Examples for B2B Companies.” LinkedIn Pulse.
  17. BHN Rewards. “Best Rewards for Your Referral Program.” BHN Rewards Blog.
  18. American Marketing Association. AMA.