Friends vs. Affiliates

What's the difference between referral programs and affiliate marketing, and which is better for your business?

John Vogel
November 9, 2022

Are referral programs right for you?

Referral programs are a great way to grow your business, but you may be wondering if they're the right fit for your company. A referral program is a way to incentivize customers to refer other people within their network to do business with you. In other words, it's a win-win situation for both parties involved. But what about affiliate marketing? Is it better than running a referral program? The truth is that referral programs have been shown to be more effective in some cases than affiliate programs because they create an authentic relationship between two people: the person referring someone else and the person taking on that referral—something that's hard not only to replicate but also measure when using affiliate marketing methods as part of your overall strategy. 

Can referral programs be a cost effective way to build your business?

When you have a referral program, you can reduce your marketing costs because your customers will do some of the work for you. They'll share their experience with others and inform them about your products or services. That's not to say that affiliate programs aren't useful for this purpose—they are! But referral programs are another excellent tool in your arsenal that can help build your business at a lower cost than other types of advertising.

It's also important to remember that referral/affiliate programs aren’t mutually exclusive; many businesses use both types of promotion concurrently. This allows them to increase their sales while reducing overall spending on marketing campaigns because they're leveraging multiple networks simultaneously instead of just one.

Are referral programs more trustworthy to consumers than affiliate programs?

Referral programs are more trustworthy to consumers than affiliate programs. When deciding how to promote your business, you may be tempted by the idea of running an affiliate program. But if you're trying to build trust with your customers and encourage them to become long-term clients, then you might want to think twice about using an affiliate program for this type of marketing effort. While both referral programs and affiliate programs have their benefits, referral programs are more trustworthy than affiliate programs by design: people will be more likely to trust a friend than an advertisement or salesperson who has no personal connection with them whatsoever (except for the money they receive from promoting the product).

How do I start a referral program?

Whether you are looking to scale your business, reduce costs, or build trust, an effective referral program can help you accomplish your company's goals. If you are interested in setting up a referral program, contact us at