Pixel tracking in referral programs is risky business

Today’s customers demand a high level of engagement from brands. Customers who interact with brands, especially through social media, assume that someone is listening to them and they expect a response.

Recently, I sent a question via Twitter to a small technology brand and the prompt (within minutes) and personal follow-up left me a bigger advocate for the brand than I was before I sent the message.

So what happens to brand advocates when the follow-up fails? In the case of referral programs, failing to follow through with an advocate, one of your best customers, can end their relationship with your brand. Or worse, it can turn them into a vocal brand detractor. According to the White House Office of Consumer Affairs, “A dissatisfied customer will tell between 9-15 people about their experience.”

When failure is not an option

The threat of follow up failure is one of the main reasons using pixel tracking to track advocate success is risky.

Pixel tracking, or embedding a small image in an email or webpage for reporting purposes, is a very common technology. For analytics, like email open rates and page views, where pinpoint accuracy takes a back seat to a general performance overview, pixel tracking is a viable solution. For example, if your email open rate is reported as 30% but is really 33%, no harm is done.  However, if each failure is a referral that you fail to recognize, at best you have failed to keep a promise, and at worst you have converted a valuable advocate into an angry brand detractor.

When tracking advocate success in your referral programs, any failure rate is too high.  Cookies (required for pixel tracking) are blocked by an estimated 5% to 40% of web browsers.  This means that you risk angering 5% to 40% of your advocates.  Most sources cite third-party cookie blocking rates at 20% to 40% and first-party blocking rates at about 5%.  A  study by comScore  suggests even higher rates.

As concerns over privacy continue to grow, an increasing number of consumers are taking measures to block and delete cookies. This fact only furthers the risks of using pixel tracking to track advocate success in referral programs.

Though using pixel tracking to monitor advocate referral success is a risky venture at best, there can be benefits. The primary benefit of pixel tracking is the decrease in setup time. By reducing development time, pixel tracking allows brands to get referral programs up and running quickly. In some cases, referral pilot programs or test campaigns, pixel tracking could be a viable option. A best practice in these cases is to create a manual success tracking process to assure that all advocates that provide a successful referral are indeed rewarded. However, even in pilot programs the risk still exist and companies must decide if the risk of alienating loyal customers is worth the time saved.

So how will you know when pixel tracking fails? You probably won’t. You may find out when an angry advocate calls and asks why their promised reward has not arrived. Or when, by failing to keep your promises your referral program generates negative buzz. By then, unfortunately, it is too late, you have turned an advocate and best customer into an angry naysayer and a former customer.


Questions? Tweet at me @JSwenson1