Setting up and Managing Your Referrals Program for Shopify

The Referrals Program leverages the connection between your existing customers and your brand to attract new ones through word-of-mouth. It works by letting customers offer their friends a reward to use on their first purchase in your store, and in turn, your customers receive their own reward for completing the referral. 

In this article, you’ll learn how to set up, launch, and manage a successful referral program.

How it works

Step 1: Your customer sends a referral link to their friend

1. An existing customer sees an offer on your site to refer their friends to your store for a reward (points or a discount.) 
2. They enter their friend’s email address.

Step 2: Their friend completes a purchase in your store using a reward

1. Your customer's friend receives an email offering them a discount off of their first purchase, or a points reward, depending on what you chose to offer.
2. They click the referral link in the email and land on the landing page that you define in your program settings.
3. They are prompted with a welcome message that includes their discount code or the number of points they received.
4. If the reward is a discount, the discount code can be auto-applied to their checkout.

Step 3: Your customer receives their reward for making the referralAs soon as their friend completes their first purchase, your customer will receive a Referral Thank You email with their reward. They can also find their reward under their rewards history.

Ensuring the referral is successful

There are several criteria to make sure both your customer and their friend successfully receive a reward for completing a referral from both ends.

1. If you choose to set a minimum purchase amount requirement, the friend’s purchase will need to add up to the total required amount, not including the discount amount. For example, if the required minimum purchase is $20, and your customer’s friend’s order totals up to $25 dollars, and they use their discount of $10 off (bringing them down to $15 total), your customer won’t receive their reward.
2. It must be the friend’s first purchase in your store.
3. The friend’s IP address and user agent when making the purchase must match their IP address and user agent when they clicked the referral link from the email they received.
   
   Please note:

   A “user agent” is the combination of a user’s device, browser and operating system. For example, Desktop, Safari 15.2, and Mac 10.15.17.
   For example, if your customer’s friend was using one computer when they clicked on the referral email link, and a different computer or phone to complete the purchase using the discount code they received, the discount will not work. 
4. The IP address and user agent of the person making a purchase using the friend discount can’t match the IP address and user agent of the person who made the referral in the first place.
   This is also to prevent any case of fraud if a customer tries to give themselves a discount using the referral process without actually referring a friend.
   
   Please note:

   You can identify a mismatch between two sets of IP addresses and user agents by checking the Referral Link Activity section and Purchase History section of a customer’s profile in Yotpo Loyalty & Referrals.

Learn more about how to check for IP address and user agent mismatch

Setting up your program

To fully set up your Referrals Program, you'll need to complete the following steps: 

1. Define the settings for the reward your customer will receive for referring their friend.
2. Define the settings for the reward your customer’s friend will receive to use on their first purchase.
3. Define the requirements for a successful referral.
4. Decide how customers will see this activity in their rewards history.
5. Design the on-site experience of your program.
6. Enable your program emails.
7. Launch your Referrals Program.

A deep dive into the steps and related actions can be found below.

Before you begin

Before setting up and launching your Referrals Program, make sure your Loyalty & Referrals account status is set to Active. To check your account status go to Settings > General Settings. 

Learn more

Step 1: Define the settings for the reward your customer will receive for referring their friend

1. Log into Yotpo Loyalty & Referrals.
2. From the main menu, go to Set Up Program > Referrals Program.
3. Under the Customer reward section, choose whether your customer will receive a Points or Discount reward.

4. If you chose Points, enter the points amount. If you chose Discount, select the discount type from the drop-down, then enter the discount amount.
5. Under Code prefix, you can add a prefix that will help you identify and differentiate between reward codes more easily.
6. Optional: If you choose a discount reward, you can click Discount settings to apply different requirements such as specific products, code expiration etc.

Optional requirements includeApply discount toChoose to apply the discount to any product, specific products, or specific collections.

• Any product - Use this if you want this discount to apply to all of your products
• Specific products - Use this to limit which products this discount can apply to, for example, if you want to promote specific products

1. In the Apply this discount to drop-down select Specific products.
2. In the Product IDs field, enter your product IDs separated by a comma. Learn more about finding product IDs in Shopify
3. In the Variant IDs field, enter your variant IDs. Learn more about finding variant IDs in Shopify

• Specific collections - Use this to limit which collections this discount can apply to if you want to promote specific collections, groups or categories of products

1. In the Apply this discount to drop-down select Specific collections.
2. In the Collection IDs field, enter your collection IDs separated by a comma. Learn more about collections in Shopify

Discount only applies to these Shopify segment IDsUse this if you want to make this discount available only to specific segments using Shopify Customer Segments

To find your Shopify segment:

1. Go to the Customers page in your Shopify admin.
2. From the Customer segment drop-down, choose the customer segment you want to use.
3. Your segment ID is the set of numbers found at the end of this page URL.

Discount code expirationSelect a reward expiration if you want the discount to only be valid for a certain amount of time. Use this to increase redemption rate and purchase frequency.

Who can use this discount code?Use this option if you want to limit the use of this discount only to the customer that originally received it.

• Anyone - use this if you don’t want to set a limit
• Only the customer who originally received this reward and is logged in to their account - You can require the customer trying to use this discount code to log in to their account to verify that it’s the same customer who originally received it

Step 2: Define the settings for the reward your customer’s friend will receive to use on their first purchase

1. Repeat the same instructions as “Step 2” above for the Friend reward.

2. Mark the box Auto-apply discount at checkout if you want the friend’s discount code to be automatically applied when he reaches the checkout. 

Use this to make the friend’s experience smoother by not having to copy and paste a discount code manually.

Step 3: Define the requirements for a successful referral

1. Go to the Program requirements section of the Referrals Program page.
2. Enter the minimum amount your customer’s friend must spend on their first purchase in order for your customer to receive a reward for making the referral.

3. Under Referral landing page URL, enter the website URL that you want your customer’s friend to land on when they click the referral link they receive in their email.
   
   Tip:

   We recommend using your store’s homepage. 

Additional email verification

This setting adds an email validation step in the referral process to further authenticate the identity of the referred friend.

• If the toggle is on,  the referred friend will need to provide their email address in the referral welcome popup in order to receive their reward. This is in addition to the default referred identification method (IP address + user agent). You will also be able to view and edit the email capture screen of the referral welcome popup.

• If the toggle is off, the referred friend identification will be the IP address and user agent only. Additionally, the referral welcome popup will not include the email validation screen and some fraud prevention settings will be automatically turned off. 

Step 4: Decide how customers will see this activity in their rewards history

Customers can see a history of the rewards they've earned by going to the redeem points section of your rewards page. Learn More

Both your customer and their friend will see the reward they earned for completing a successful referral in their Rewards History.

Action text - The default text is set to Refer a friend. To change it, click in the Action text field and type in the text you want to appear in your customer’s rewards history.

Reward text - Use the {{reward}} off placeholder to present the discount amount your customer and their friend received in their rewards history.

Step 5: Design the on-site experience of your program

There are a few options available for displaying your Referrals Program on your store. The basic widgets we recommend getting started with are the Refer Friends Widget and Referral Welcome Popup

Step 6: Enable your program emails

There are three customer emails that we recommend enabling to support your Referrals Program:

1. Referrer Thank You
2. Referral Share Email
3. Referral Share Email Reminder

All 3 emails are initially enabled by default. To customize or turn them off:

1. From the main menu, go to Communications > Referrals Emails.
2. Scroll to the relevant email.
3. Click Customize to change the default message template.
4. Click Disable Notification to turn it off.

To learn more about the purpose of each email and how to customize them for your program, please reference this article.

If you are using a third-party ESP for your program emails, you can control the settings from there. 

Step 7: Launch your Referrals Program

Now that you’ve set up all sides of your Referrals Program, click Activate to launch it on your site for the first time.

Note: To activate your Referrals Program for the first time, your Loyalty & Referrals account must first be Active. To check your account status go to Settings > General Settings

Your Referrals Program is now live!