Posted in Marketing and Strategy Terms, Total Reads: 613

Definition: Referral

Referral refers to the act of sending or diverting a source to some other destination, i.e., to refer someone/something to other point. It may also help in spreading awareness about the referred object/person and can be seen as a recommendation by the referring body.

In this context, referral marketing means a process by which a company promotes its goods and services by informing its customers about its product and services, usually through word of mouth. It generates such referrals spontaneously, and encourages and rewards its customers for spreading word about their products and services.


This method helps in new customer acquisition. This acquisition is dependent on existing customers retained and the rapport of the company in the eyes of the customer.


Digital Marketing is an internet based approach to the conventional referral marketing.


For example, when you refer the shop where you buy your clothes from to your friend, it promotes the shop by word of mouth.


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