Case Studies - Referral Programs and Lead Generation Programs that Car Manufacturers have done at the brand level.
Below is a list of four referral and/or lead generation programs at the car manufacturer level for Tesla, Nissan, Toyota, and Kia. A case study on the success of Tesla’s referral programs is included in the write-up, however, no other case studies could be found for the remaining included programs. Further, many programs found for Nissan and Toyota related to a dealership level, so the ones included focus on partnerships with Nissan collision experts across the country in order to enhance customer experience, and Toyota offers an associate referral program that doesn’t offer any tangible awards, only VIP experience.
TESLA — PREVIOUS AND NEW OWNER REFERRAL PROGRAM
Through a personal referral code, Tesla customers can give friends “free, unlimited Supercharging with the purchase of a new Model S or Model X.” Further, the first friend a Tesla owner refers between February 1 and April 30 will receive a $500 credit, which can be used for service or accessories.
In response to referring their friends to Tesla, owners will be eligible for the following referral rewards, based on how many friends they refer.
1-2 Qualifying Referrals:
Can choose from one of the below options
-Signature Black Wall Connector: This wall connector in matte black is only available through the referral program, and has “an etch of Elon’s signature.”
-Founders Series Tesla Model S for Kids: Receive an electric, mini Model S that a child can drive and operate themselves, with headlights, a charging port, and a sound system.
3 Qualifying Referrals:
Can choose from one of the below options
-21” Arachnid Wheels for Model S or 22” Forged Turbine Wheels for Model X: Specially “forged-aluminum wheels” for a Tesla, exclusive to the referral program.
-One Week with Model S or Model X: Test drive a Model S or a Model X for a full week, both on the road driving and at home. Owners can give this reward to a friend if they don’t want to use it themselves.
4 Qualifying Referrals:
-Founder Series Powerwall 2: A distinctive home battery that can be used for backup power or future use. This battery is not yet available to the public.
5 Qualifying Referrals:
-Tesla Unveiling Invitation: If you refer five friends to Tesla, owners are invited to the next Tesla unveiling event, which includes a VIP invitation for the owner and one guest.
-Easy Access Token for Solar Roof: Receive a token for “priority scheduling of a Solar Roof installation.” If the owner doesn’t want to use this reward, they can give it to a friend.
In addition to the referral rewards above, there will be weekly drawings of all owners who refer a friend. Each week, a winning owner will race in a “giant electric semi-truck” around the Tesla test track. Best track times will qualify for further prizes, and for every friend who signs up for the Tesla newsletter through the referral link, an entry will be made in the owner’s name. Using the Tesla mobile app, owners can see how many entries they have.
Further, a Tesla owner can give five friends a “5-year extended limited warranty on a new solar energy system installation”, which will qualify them for further referral rewards (listed below):
Owners will receive $400 in cash or $750 in Tesla credit for every installed solar energy system referral. The credits can be used for new Tesla accessories and car products, and will be valid for 12 months.
Owners will receive the Powerwall 2 home battery, which can be used for backup power or future use.
All referrals must be placed between May 19, 2017 and April 30, 2018. All referred vehicle orders must be ordered and delivered before the award is received, and solar energy installation must be done prior to any award delivery. Model 3 and used cars are not eligible. The referral code can only be placed at the time of the order, not afterwards, and there is a limit of five referral orders per owner. Owners must be 18 years or older to participate and be eligible for rewards, and all rewards are non-transferable and “not redeemable for cash.” Ohio and Virginia residents are not eligible for rewards, and owners are responsible for all local taxes, requirements, and fees. Owners cannot be employees of Tesla or be affiliated with any part of Tesla or partner of Tesla.
CASE STUDY — SUCCESS OF TESLA
As Tesla has a “$0 marketing budget”, they’ve relied on their customers and referral programs to spread the word of Tesla. By treating their brand ambassadors as heroes and offering rewards that are unique to the owner and the program, they’re seeing success. Current customers are doing the selling for them, as there is incentive for them as well as the friend they refer.
CEO Elon Musk has estimated that their referral programs are saving Tesla “$2,000 per transaction, compared to regular in-store sales.” Tesla has found that by rewarding both their new customers and owners who continue to refer friends and buy Tesla, is the best way for them to drive further sales. Because each party receives a prize, owners are more likely to refer Tesla so they don’t feel “selfish or transactional” with their referral. An average price for a Tesla is $85,000, and Tesla is seeing 40x ROI on every referral sale.
During their second referral program, the company included a new Tesla P90D Model S (valued at $130,000) for the best sales advocate in each region (North America, Europe, and Asia). The top advocate referred 188 people to purchase a Tesla, and he brought in over $16 million in sales for Tesla, and received prizes worth $135,000, which equates to an ROI of 199x for each sale. His high number of referrals showed the authenticity of Tesla through the “passion of [their] customers.”
The third referral program was geared towards the every-day, casual Tesla customer. Instead of only qualifying for awards through extensive referral numbers, this award included a tour of their SpaceX headquarters in Los Angeles, California.
Moving into referral programs four and five, where we are now, Tesla is doing tiered rewards programs. It gives something for everyone — you can refer one friend and receive something, or you can refer five friends and receive even more. The main theme through all of Tesla’s rewards is that they are one-of-a-kind. No one, except the referrals and owners, is eligible for these products, even other existing Tesla customers.
NISSAN — ODM TOOL
Please note. Nissan began this program in 2014. To enhance their Nissan Certified Collision Repair Network program, Nissan launched a consumer-focused referral program that will give Nissan owners access to Nissan Certified Collision Repair Providers.
The ODM (On-Demand-Marketing) tool allows Nissan shops access to Nissan owners geographically around them. Through the ODM tool, they can send messages to Nissan owners about the abilities of their Nissan certified shops. Through this program, Nissan promises that each shop will have the correct “tools, equipment, training, and facilities to repair Nissan vehicles to the company’s exacting specifications for fit, finish, durability, safety, and value.”
This program was developed in response to Nissan customers having difficulties with third parties doing their collision repairs, as their best interests weren’t kept in mind. By providing certified Nissan shops for customers to use in their area, Nissan is hoping to enhance their customer’s experience, and showing that they value safety and precision in repairs of their cars.
To move this program along, Nissan partnered with Assured Performance, which is “a non-profit consumer advocacy organization and the third-party administrator for OEM Certification-Recognition programs.” They will utilize Assured Performance to help identify and train Nissan certified shops across the country. Scott Biggs, CEO of Assured Performance, noted that “no business or person should be able to touch a vehicle if they are not equipped and trained to do it properly”, as consumers shouldn’t be paying for work that is substandard to what Nissan provides.
The goal of this program is to show current and future Nissan owners that by purchasing a Nissan or Infiniti car, they never have to worry about finding a reputable repair shop to help them with any future collision damage. Nissan will provide them with certified, top-of-the-line repair options that meet the standards of their factory work.
TOYOTA — ASSOCIATE REFERRAL PROGRAM
If an associate of Toyota is referring a “friend, neighbor, or acquaintance” to any Toyota, Lexus, or Scion product, the buyer they are referring will receive VIP treatment from the dealer of their choice.
This program only offers the buyer special “VIP” treatment during their sales experience — no special incentives or prices are offered to the buyer. The referring associate is not supposed to discuss price, or answer any questions on price, with their referral, as all of that should take place between the buyer and a dealer of their choice.
KIA — REWARDS REFERRAL PROGRAM
Note, this referral program is for Canadian Kia members. Kia offers a points reward system for Kia owners:
Kia Canada Points: Existing owners will receive up to 150,000 reward points when purchasing a new Kia vehicle
Dealer Points: Kia owners will receive 10 points for every $1 spent at a Kia dealership of their choice, as it relates to parts, accessories, and maintenance services.
Double Your Points: Points from a Kia owner’s dealership, as well as their Kia Canada Points, can be combined and applied towards their next purchase of a Kia vehicle (up to $1,500 in points).
Bonus Dealer Points: Kia owners can earn 20,000 bonus points for each new customer they refer to Kia that results in a “new Kia vehicle sale.”
Further, Kia owners can receive 2,000 points if they complete Kia’s recommended annual maintenance check, and receive another 1,000 points for going to their first appointment when looking at a new Kia.
In terms of redeeming their points, Kia owners can use their points at their local dealer for free parts, services, and accessories. Owners can redeem their Kia Canada points towards their next Kia purchase for a maximum of $750 off the purchase price (if they combine Kia Canada and dealership points, they can receive up to $1,500 off the purchase price). If the owner doesn’t want to use their points, they can transfer them to another member of their household.
Tesla has seen enormous success with their referral programs and caters to both their “go-getter” customers (i.e. the customer who referred 188 people to Tesla) and the “laid-back” customer (i.e. the ones who maybe only refer one or two customers). Both Tesla and Kia offer tangible results in their reward programs, such as new accessories and products for cars. Nissan is working to improve their customer’s experience when it comes to collision repairs on their cars, by providing certified and reputable maintenance services to their existing customers at a local level. Toyota offers the least of the included brands, as their associate referral program offers “VIP” treatment for any referred guests during their sales process.