How to Create a Referral Program in WordPress (Step-by-Step Guide)

Driving traffic and sales is one of the biggest challenges facing any business today. Referral marketing has proven to be an excellent organic acquisition channel to complement your existing efforts.

According to a Nielsen study, 92% of consumers trust recommendations from friends and family above all other forms of advertising.

In this comprehensive guide as a WordPress marketing expert with over 5 years of experience, I‘ll show you exactly how to create a custom referral program on WordPress to maximize sales and revenue for your company.

Why You Need a Referral Program

Here are the top reasons for any business owner to set up a referral program:

• Higher conversions – Referrals convert at least 2-3 times higher than traditional channels because they come pre-endorsed from a friend. Over 25% end up purchasing compared to a 10% average.
• Lower costs – On average, referral customers cost 40-80% less to acquire versus paying for ads and other direct outreach. You only pay partners who drive actual completed sales.
• Quicker growth – Referrals help good products sell faster. 83% of clients indicate they spend more on brands they are referred to by friends. The more affiliates you have, the quicker word spreads.

When designed and managed effectively, referral marketing should be a cornerstone of growth for any business alongside content, email, social, and ads.

Choosing the Right WordPress Referral Plugin

Managing an affiliate program requires reliable tracking software. Here are two great self-hosted WordPress options I recommend:

Both integrate seamlessly with WordPress and top ecommerce plugins like WooCommerce.

Now let‘s go through how to set up and configure AffiliateWP, the best all-around affiliate solution.

Step 1 – Install and Activate AffiliateWP

First, you need to install the AffiliateWP plugin in WordPress.

1. In your WordPress dashboard, go to Plugins > Add New
2. Search for "AffiliateWP", install, and activate it
3. Alternatively, purchase and upload AffiliateWP manually from your account

Upon activation, a new Affiliates menu will appear alongside standard items like Posts and Pages. This is where you will manage everything related to referrals.

Step 2 – Configure Global Referral Program Settings

With AffiliateWP running, you need to configure all the core settings for your program under Affiliates > Settings:

• Terms – Create T&Cs affiliates must accept
• Registration – Choose whether affiliate registration requires admin approval
• Commission – Set default referral pay out rate
• Creatives – Upload logos, banner ads, and content affiliates can use
• Integrations – Connect to ecommerce and membership platforms

Take your time to properly set up the global rules and structures you want.

Here is an example setup:

Be sure to click "Save Changes" along the way in each section.

Step 3 – Create Signup and Registration Flows

Next, you need to decide how new partners register and join your program.

Under Settings > General adjust whether affiliates can:

• Signup instantly
• Request approval
• Require admin creation only

You can also customize supplemental info like business address needed during registration.

Step 4 – Promote the Program and Recruit Affiliates

With everything configured, it’s time to spread the word!

The four best ways to find and recruit quality affiliates include:

1. Email your customer list – Offer your existing audience special incentives for joining
2. Share on social media – Post on your brand profiles and have staff share socially as well
3. Content marketing – Create dedicated landing pages and blog posts explaining the value
4. Paid ads – Consider small test budgets to raise awareness beyond existing channels

Depending on your niche, great partners to target include:

• Bloggers and influencers
• Loyal customers
• Business partners
• College students

The wider the reach, the more affiliates will apply.

Step 5 – Review and Onboard Affiliates

As marketers sign up and apply to your program, you’ll be notified within the WordPress dashboard.

Go to Affiliates > All Affiliates to review pending requests and approve or deny each.

Look at factors like audience size and relevance in deciding whether to accept an applicant.

As your program scales over time, this management and communication takes place automatically without any extra work required.

Step 6 – Track Performance and Pay Partners

Once you have affiliates live and promoting your offerings, it’s critical to closely track their performance and payout earnings.

Leverage the detailed reporting under Affiliates > Reports to view metrics like:

• Referral sales
• Commissions earned
• Click through rates

Monitor trends over time and use the data to optimize your program‘s effectiveness.

AffiliateWP supports automatically paying partners based on confirmed conversions or sales thresholds through Stripe disbursements.

You can also export payout reports to process payments manually outside the plugin.

Pro Tip: Set your commissions, tracking, and payment terms upfront so everything stays consistent across all affiliates.

Final Thoughts

Launching a custom WordPress affiliate program takes a bit of upfront effort. But once configured properly, the platform will automate and scale most of the tedious admin work for you.

The key is spending time to strategically source and recruit quality partners that closely align with your products. Avoid partners purely chasing quick payouts.

Referrals can become one of your best sales channels over time when done right. Follow this guide to get started and grow revenue today.

Let me know if you have any other questions!