Referrals and Word-of-Mouth

"Referrals is massive on the dasher side. It is effective on the consumer side too, but less so."

"While leading the supply growth work at Airbnb, one of the teams I oversaw built and scaled the host referrals program. The team (made up of folks much smarter than I) took it from a nascent half-functional program to the single biggest driver of attributable supply growth. Not only that, it quickly became the most efficient paid-growth channel AND drove the highest quality supply."

"The added incentive that a referral program offers simply adds fuel to an existing fire. I haven’t seen referrals work when there wasn’t strong existing WOM."

"The key to a strong referrals program is having an incentive that genuinly motivates people to take action. An extra $10 likely won’t cut it. Talk to your users and get a sense of what they’d get excited about (may not be cash), and then figure out if your CAC/LTV can support it."

"You’ll be an order of magnitude more successful in developing this program if you have a data scientist deeply involved in the planning and iterations."

"Don’t expect your users to immediately (1) discover, (2) understand, and (3) be motivated to refer friends. Repeat the pitch at every touch-point, highlighting the incentive, and don’t rely on one-off campaigns."

"When designing your referrals program, it’s important that (1) the referer has a meaningful incentive, be it cash or credits, that (2) this program is easily discoverable, and that (3) you are incentivizing the right behavior — the referral reward should only pay out once the new user has hit a valuable milestone."

"Supabase shows how to turn organic pull (GitHub stars, YC adoption, vibe-coding buzz) from developers into structured funnels, lifecycle paths, and monetization."

"Harry’s gave users had the opportunity to earn free products by sharing an invite with friends. The more friends who signed up using your unique referral link, the bigger the prize you earned."

"This is by far the cheapest and best way to grow if you can pull it off. Most products do not grow this way (and it’s nearly impossible to layer on if the product isn’t naturally suited for this), so don’t be sad if you can’t make this work."

"Thinking back to our formula above, you have three levers at your disposal: 1. Increasing sharing rate: More word-of-mouth, invitations, or experiential serendipity 2. Increasing conversion rate: Getting new users through your funnel at a higher rate 3. Increasing engaged users: Getting more users, and re-engage existing users"

"You should only invest in virality if you are confident that virality will be your primary growth engine for your product. As opposed to (1) performance marketing, (2) content, or (3) sales."

"There are three forms of virality, with 2-3 versions of each, for a total of seven types of virality: 1. Word-of-mouth virality... 2. Invitation virality... 3. Experiential virality..."

"Word-of-mouth is primarily driven by remarkable experiences (an experience worth remarking about), so start there."

"How might you make the user’s life easier if their friends or colleagues were also using it? e.g. easier to share content, a secure communication channel"

"Experiential virality: Seeing the product in action. 6. Passively: Seeing the product as you go about your day (e.g. Citizen) 7. Actively: Being sent a piece of content from the product, which leads you to the product (e.g. TikTok)"

"Referrals (online program) was more impactful top-line, but Ambassadors (people referring users on the ground) were key piece to the launch strategy in each city -- seeding supply and demand ahead of launch. We were able to reduce overhead when launching a city this way, by getting the word out early."

"If you look at the composition of growth of Airbnb, WOM was by far the biggest driver early on. Way over 50% on the guest side and way over 70% on the host side."

"Later, we had a two-sided referral program where if supply referred new supply, we would pay them $50 for each activated pro (after completing their first gig). If they referred a restaurant we would give them something like $300."

"We’d recruit an ambassador and then work with them to understand the mechanics of their school, which took less time as we became more familiar with complex schedules. They were consistently excited to launch at their schools, and frequently earned social capital for having been our ambassador."

"External virality is the classic form of virality through multiplayer use and product exposure, which we’ve come to associate with collaboration products like Zoom, Loom, or Typeform."

"Templates can also be a way to kickstart a community strategy where you source templates from your power users (for example, Miro’s [Miroverse](https://miro.com/miroverse/)) or even let users monetize the templates they’ve created, as [Notion does](https://www.notion.so/templates)."

"- **Invite rate:** % of new users who sent at least one invite in the first X days - **Invite conversion rate:** % of users who receive an invite that sign-up in the next X days - **Virality factor:** % of new users who have come from an invite"

"Invite rate:% of new users who sent at least one invite in the first X days. Invite conversion rate:% of users who receive an invite that sign-up in the next X days. Virality factor:% of new users who have come from an invite."