Referral Partners vs Affiliate Partners: What’s the Difference?

As more and more people use the internet to browse, get information, and make purchase decisions, the amount of money companies are investing in digital ad spend continues to grow. In 2019, global online ad spend was projected to grow 4 percent, but it surpassed that expectation and hit almost 5 percent. Part of this surge is thanks to the power of people and their ability to recommend products and services they love through digital channels. Two effective ways of collaborating with people to generate leads and expand your customer base are referral partnerships and affiliate partnerships. But how are they different, and which one will impact your business growth the most? Let’s take a look at the major distinctions that separate these two approaches.



Referral partners: Relationships are the foundation of referral marketing and come from your existing customer base. The premise of a referral program revolves around happy, existing customers who share your product or service with their personal or professional networks.

Affiliate partners: Selecting an affiliate partner is more about the audience that person can reach. An affiliate does not have to be an existing customer. Instead, affiliate relationships start with the demographic and reach of their potential influences, and a relationship with the affiliate is built in order to develop a partnership to appeal to that audience.



Referral partners: Rewards for referral partners mostly come in the form of perks, like discounts, free upgrades, or samples of a new product. For example, meal services such as HelloFresh and Blue Apron offer incentives like free meals for customers who get others to sign up.

Affiliate partners: With affiliate programs, the reward almost always comes with a concrete price tag, whether it be a percentage of the sale or a monthly bonus for hitting certain benchmarks. Since affiliates aren’t always existing and loyal customers, they are usually attracted by monetary incentives.



Referral partners: Since referral marketing is all about building trust through strong, existing relationships, referral partners tend to spread the word through more personal channels like email, text, Facebook Messenger, or even in person.

Affiliate partners: Because affiliate partners are sharing your product or service to people they might not know directly through promotions rather than personal outreach, their channels are going to be more link-based. They might put links in their Instagram Stories, on their websites, or through paid social media ads.

So how do you know which kind of partnership is best for your growing business? That answer really depends on your budget and the type of service you are offering. If you want to pay to cast a wide net and see who you attract, an affiliate partnership might be the method to try. If you want to expand your reach through attracting customers like the satisfied ones you already have with lower spend and more specific targeting, then referral marketing might be your best bet.


Want to learn more or have questions on the best way to market your business through partnerships? Schedule a demo today.