How can referral marketing counter Facebook's organic reach problem?

It's becoming clear that brands looking to get their way into more fans' and users' News Feeds, there are two main options — advertising and getting a friend to share a message. Referral marketing is one way to get that important share. Facebook announced recently that explicit shares from a third party app now hold more weight in its News Feed algorithm. But how can you get a Facebook user to willingly share your content with their friends? Offering some kind of reward or incentive works, according to Extole Vice President of Marketing Chris Duskin. He said that Extole's clients have seen a lot of success with referral marketing, motivating fans and customers to share content and have the message spread across Facebook. For Extole customers in Q1, 33 percent of acquisitions happened within an hour of a friend receiving a referral message from an existing customer. While referral marketing may be a little easier to do via email, Duskin talked with Inside Facebook about ways that brands can use this technique to get back into the News Feed. Inside Facebook: How do you feel about the recent changes to the News Feed algorithm? Chris Duskin: My initial reaction was that this is a recognition that authenticity matters. So a share or post from a source or a connection that's trusted should be prioritized. It should be something that gets reach beyond that of something that's promoted. For me, it felt very natural. I thought it was consistent with the other news about organic reach by brand being reduced by Facebook. IF: So do you feel that more apps and more brands are trying to get some way to get users to share content manually, through referral programs? CD: What we're seeing is the natural evolution among our brands toward an environment where the brand is encouraging, but isn't necessarily the voice of sharing. We see, for example, your standard Facebook/Google Plus/LinkedIn buttons on product details being replaced by referral buttons. I think there's two reasons: to capture the delight of the moment of looking at something, but you're connecting with people, which is why they have pages to begin with, but what we're really trying to do is not accumulate fans or get some degree of awareness, what we're really trying to do is activate people. These more passive sharing experiences are becoming more active through incentives and requesting a friend (check this out). Here's something I can give you as a current customer to encourage you to do so. That type of control that a brand gets over the sharing experience is really powerful. The other thing that is happening is that people aren't thinking of placements of where the sharing should occur, but when it should occur. What's the moment when I should contact someone about the ability to share? Is it after they've written a rude review? Is it a few days after they've received a product? Is it as they're opening the package — the ability to share is right in front of them? We're starting to think about the sequences of interaction as opportunities to share. Something that the more sophisticated folks are doing that we work with, they're really testing when I should be messaging someone and how I message the sharing opportunity and they're getting a lot of activity as they get smarter about that. IF: So how can brands turn the tide on the organic reach problem on Facebook by becoming more proactive in referral programs? CD: One of the things about the demise of organic reach on Facebook is that the tactics for marketing on Facebook are going to have to get a little more sophisticated and diverse. What we hear from social marketers in particular is that this is a freeway to augment a bunch of other social strategies. It doesn't replace other things that you're doing on social, it's definitely complementary. What they like about it is it's social in nature. It is a person-to-person communication — a targeted recommendation from me to someone who I know is likely to respond to that message. It's very appealing, it's bottom-line social. We see it in our business and across industries. Referrals are emerging as this next channel for customer acquisition. There are a couple things that are driving it. That person-to-person communication, as that's what's expected on the internet today. Secondly, you can scale it now. Referral programs have been around for a long time, they just lacked the ability to reach the scale necessary to make them a top tactic for a marketing organization, and we're seeing that definitely shift. Readers: What referral marketing tactics do you use to get users and fans sharing your message on Facebook?

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How can referral marketing counter Facebook's organic reach problem?

Justin Lafferty

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Justin Lafferty