[Data Insight] What are the most popular types of referral rewards? 🔥

Rewards are the fuel for any referral program, answering the “what’s in it for me?” question for anyone who’s thinking of participating.

To give you an idea of the most popular types of rewards, we looked at anonymized data from 500+ programs run on Referral Rock over the past year — here’s what we found.

Stat 1: 1-sided vs. 2-sided programs

• 74% offer 1-sided rewards

• 26% offer 2-sided (or dual-sided) rewards

💡 The lower number of 2-sided programs surprised us, because 2-sided rewards — where both the referrer (member) and the referral get a reward — tend to yield better results. In fact, a customer of ours recently told us that when they shifted from a 1-sided to a 2-sided reward offering, they saw a big jump in referrals. The takeaway? A better “hook” for your target audience can really get things rolling.

That said, the data shown above includes customer referral and affiliate or brand ambassador programs — and 2-sided rewards aren’t common for affiliate programs. In these cases, the member/referrer receives a flat-fee or percentage-of-sale reward.

Stat 2: Reward types for members (e.g. customers referring their friends or affiliates recommending to their audience)

• 61% reward gift cards

• 30% reward cash (PayPal and Wise transfers)

• 9% reward coupons/discounts

💡 Gift card and cash rewards for members make a lot of sense for both customer referral and affiliate programs. While discounts are more common for lower-cost consumer products like clothing or cosmetics, many companies will reward cash or gift cards for items that are less likely to be repeat purchases (e.g. home services, air conditioners, bank accounts).

And, as mentioned above, cash payouts are common for affiliate marketing programs, where affiliates are incentivized by ongoing monetary rewards.

Stat 3: Reward types for referrals (e.g. someone who purchased after they received a referral from a friend)

• 56% reward gift cards

• 37% reward coupons/discounts

• 7% reward cash (PayPal and Wise transfers)

💡Coupons are a more popular choice when rewarding referrals, which makes sense — you’re trying to incentivize a purchase from someone new. An exclusive offer, like a percentage or dollar amount off (e.g. 25% off, $20 off) is compelling, especially after someone has received a product or service recommendation from a friend.

Stat 4: Fixed reward amounts vs. percentage of sale reward amounts

• 92% of programs reward a fixed amount

• 8% of programs reward a percentage of sale

• For companies that reward percentage-based amounts, the average value of percent rewarded is 23% of the sale.

💡 As noted above, percentage-of-sale rewards are more common for affiliate programs and less common for customer referral programs. It can also be harder to come up with a percentage-of-sale amount that makes sense across products and services, so many companies start with a fixed amount to make it easier to predict payout costs.

Need help coming up with rewards?

We hope the data above can help you start thinking through your reward options. If you need more ideas, we’ve got you covered with How to Choose the Best Referral Rewards (with 24+ Examples). 

And before we go, one more question!

P.S. If you’re looking for more data insights on referral programs, check out our past posts.