Word of mouth is how most small shops actually grow, and almost none of them do anything to encourage it.
The customer who recommends you to three friends gets exactly the same treatment as the one who never mentions you. There is no mechanism, so the behaviour you most want is the one behaviour you do not reward.
How it works
Every customer has a referral link on their rewards page, ready to copy.
They send it to someone. That person arrives at your shop, places an order, and two things happen: the referrer is rewarded, and the new customer can get a discount on that first order.
Rewarding both sides matters. A referral scheme that only pays the referrer asks a customer to use their own credibility for your benefit. One that gives the friend something too turns the share into a favour they are doing for the friend, which is a much easier thing to send.
What the referrer gets
Points, or a discount. Your choice.
Points tend to work better, because they pull the referrer back to your shop to spend them. A discount is a one-off; points are a return visit.
Tracking
Referrals are recorded, so you can see the relationships: who referred whom, and which orders came from it.
That is more useful than the totals. Most referral programmes have a handful of customers producing most of the referrals, and those people are worth knowing about. They are your best marketing channel and they are doing it for points.
Rewarded on a real order
The referrer is rewarded when the referred customer actually completes an order, not when they click a link or create an account.
This is what stops the obvious abuse. A scheme paying for signups pays for fake signups, and someone will find that within a week of you launching it. Tying it to a completed order means every reward corresponds to real revenue.
Sharing beyond the link
Perkie can also reward the act of sharing your shop on social or by email, separately from whether that share produces a sale. Each share carries the customer’s own referral link, so the two systems are the same system: the share puts the link somewhere, and the link is what earns when it works.
Share rewards are handled so they cannot be farmed by sharing repeatedly.
Milestones
Cumulative referral counts can carry their own rewards. A customer who has referred five people gets something for reaching five, on top of what each individual referral earned.
This is what keeps a good referrer going. The first referral is a novelty; the fifth needs a reason, and a milestone is that reason.
The reward email
When a referral pays off, Perkie emails the referrer to tell them. If the reward is a discount, the email spells out the actual terms: the coupon code, what it is worth, and the date it is valid through, so the customer has everything they need without going looking for it.
The wording is yours to change. Every store runs its referrals a little differently, so amend the email content under Perkie’s Emails tab to match how yours operates: your tone, your conditions, and anything else you want your customers to know. The merge tags ({coupon_code}, {coupon_value}, {coupon_expiry} and {conditions}) drop the live details into whatever copy you write, so you can move them around or leave them out.
Why this belongs with loyalty rather than in a separate plugin
A referral is a loyalty action. It happens in the same place, to the same customer record, earning the same currency, shown on the same account page.
Running it as a separate system means two sets of records, two customer-facing pages, and a customer who has to understand that their referral credit and their points are different things. Which they should not be.