Merchandising/Marketing/Retailing: Branding

A Brand’s Referral of Another Brand: Does it Work?

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Abstract

Online startup brands’ primary, if not the only, sales channel is their online stores. Operating primarily online can be limited in acquiring new customers. In an emerging low-cost marketing partnership, a brand inserts another brand’s promotional messages in its marketing emails. This is akin to a brand’s referral of another brand. The current study’s objective was to test the effectiveness of this strategy, relative to social media marketing and a consumer referral by a close friend. This study employed a one-way between-subjects design with four brand promotion conditions: a referral by a close friend, a referral by a high-loyalty brand, a referral by a low-loyalty brand, and social media marketing. Results showed that a high-loyalty brand’s referral can be as effective as a close friend’s referral, and even a low-loyalty brand’s referral can be as effective as social media marketing. This indicates that brands’ referrals can be an effective, yet low-cost marketing strategy.

Keywords: Referrals, Word-of-mouth, Email marketing communication, Customer acquisition strategy, SMEs, Digital startups

How to Cite:

Shin, D. C. & Rothenberg, L., (2020) “A Brand’s Referral of Another Brand: Does it Work?”, International Textile and Apparel Association Annual Conference Proceedings 77(1). doi: https://doi.org/10.31274/itaa.11738