{"id":8959,"date":"2022-09-21T12:39:02","date_gmt":"2022-09-21T11:39:02","guid":{"rendered":"https:\/\/cowrywise.com\/blog\/?p=8959"},"modified":"2023-03-22T16:34:33","modified_gmt":"2023-03-22T15:34:33","slug":"referral-bonus-experiment","status":"publish","type":"post","link":"https:\/\/cowrywise.com\/blog\/referral-bonus-experiment\/","title":{"rendered":"Why We Stopped Giving Money as Referral Bonus on Cowrywise"},"content":{"rendered":"\n

Growth Experiments by Cowrywise<\/em><\/strong> is a detailed, industry report on experiments and campaigns run by the team to give industry leaders, marketers and start-ups insights and nuggets of wisdom to help them scale and succeed. We believe in transparency and are of the position that knowledge of this nature should be accessible in order to help the industry grow as a whole. <\/p>\n\n\n\n

Read this for insights into our referral bonus experiment on Cowrywise. <\/p>\n\n\n\n

In this article, we will tell you:<\/h2>\n\n\n\n
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  1. What inspired the referral bonus experiment on Cowrywise<\/li>\n\n\n\n
  2. What we observed early on<\/li>\n\n\n\n
  3. What we learnt as a result<\/li>\n<\/ol>\n\n\n\n

    To other start-ups looking to run or are in the process of running a referral campaign, here are a few insights and nuggets we hope will help you scale and optimize your campaigns. Good luck!<\/p>\n\n\n\n

    Black Friday Experiment<\/strong><\/h2>\n\n\n\n

    In 2021, Black Friday was held on the 26th of November and we decided to carry out a growth experiment. This was to test which incentive would drive users to refer friends to use the app.<\/p>\n\n\n\n

    This experiment was only for 24 hours and in that timeframe, users could earn 100% more in referral bonus<\/a>. It moved from N250 to N500 if they successfully invited friends to signup on Cowrywise.<\/p>\n\n\n\n

    On that day alone, the experiment generated about 6x more referrals than the previous day. Also, at the time, it was the highest referral count we had ever recorded on a single day. And the possibilities seemed endless.<\/p>\n\n\n\n

    \"\"<\/figure>\n\n\n\n

    Trying out the referral bonus<\/strong> experiment for a longer period<\/strong><\/h2>\n\n\n\n

    Since the increase in referral bonus led to a considerable number of signups on Black Friday, the team decided to launch it again on the 7th of December 2021 \u2013 this time for a longer duration.<\/p>\n\n\n\n

    For about 2 months, the referral bonus on Cowrywise increased by 400%! It went up from N250 to N1,000. <\/p>\n\n\n\n

    The goal was to encourage as many users to use their referral code to invite friends and family. From the first day of this experiment, referrals increased exponentially.<\/p>\n\n\n\n

    This was expected, as the previous experiment was successful albeit on a much smaller scale. And since one of the KPIs of any startup growth team is to increase user signups, it felt like an easy, go-to hack \u2013 one experiment to rule them all.<\/p>\n\n\n\n

    An invaluable lesson about attracting ants with sugar<\/strong><\/h2>\n\n\n\n

    One surefire way to know if there are ants around? Pour out a heap of sugar \u2013 that\u2019s when the ants come out of their hiding place. <\/p>\n\n\n\n

    \"\"<\/figure>\n\n\n\n

    The highest user signup since inception was recorded during this period, but it didn\u2019t take long to observe that the campaign wasn\u2019t going as planned. <\/p>\n\n\n\n

    Daily user signups increased by more than 4x, with the highest user signup since inception being recorded in that period. However, our excitement did not last very long. What quickly became a source of concern was the rapid proliferation of questionable messaging people used to market Cowrywise that did not align with our values.<\/p>\n\n\n\n