You may already use employee referrals in your recruiting strategy. It only makes sense. As a top source of new hires, a company is at a disadvantage without referrals. But do you know how truly valuable employee referrals are?

According to HR Tech Weekly, employee referrals have the highest return on investment and save thousands of dollars per hire. Employers rate employee referrals as the best return on investment and a top source of quality new hires. Another bonus: the American Journal of Sociology finds that referred workers will likely refer future workers.

Anything that boosts your employee referral program is great, but gamification is one of the most effective ways to increase referrals. Employers use gamification for recruiting in many different ways. They use gamification to rank candidate skills, simulate actual work, and motivate employees.

Related: Employee Referral Programs: 5 Things That Need Your Attention

An effective employee referral program should include four important elements:

• Incentives – A mix of cash, extra paid time off, and sincere appreciation
• Be easy to use – The easier it is to understand and use, the better
• Feedback – Communicate the referral program well and let employees know how their referral is doing
• Recognition – Be sure to recognize employees who are referring successful workers

What is Gamification?

Gamification is applying elements of game-playing to other activities. Employers can gamifiy training, recruiting, employee engagement, and more. And the process can be automated using platforms such as:

• Spinify to motivate sales teams
• Engagedly for talent management and employee engagement
• Trivie for training
• Talentry for employee engagement and referrals

However, employee referral programs and other employer recruiting initiatives can also be gamified without being automated. There are many ways to add gamification to employee referrals on a budget. LinkedIn opportunity connector Smitha Prasanna says it’s as easy as keeping referrers updated on the status of their referrals.

She says to give points for different referral actions, such as referrals, hires from referrals, and sharing job notices. Prasanna recommends making referrals fun and competitive in a friendly, transparent way with leaderboards and the ability to share referral rewards. Be creative with requests and rewards to drive interest and participation.

Take a look at how these employers are using gamification economically for employee referrals.

PURE - American Property Insurance Company

Insurance company Privilege Underwriters Reciprocal Exchange (PURE) gets 40 to 60 percent of its employees by referral. They manage to achieve those numbers by asking for referrals of their new hires when hired. Recruiters ask new hires if they know anyone they would refer to the company.

This gets active referrals rather than making employees go through a referral program or process, and it puts a focus on employee referrals.

Not only that, but PURE makes employee referrals a focus on their website. They highlight exceptional referrals, as well as ask website visitors if they will refer business to PURE.

DigitalOcean

DigitalOcean has a 43 percent participation rate in its employee referral program. They not only offer a referral bonus, but also a charitable donation on the referring employee’s behalf. This has resulted in 40 percent of new hires gained through referrals.

Be creative with referral bonuses by offering the option to donate to the employee’s preferred charity to create goodwill and engagement. You could extend this by promoting referring employees’ charities in your company and letting everyone know about the causes and how to help.

Hewlett Packard Enterprises

Hewlett Packard Enterprises has built employee referral recognition into its company culture by focusing on employee referrals and referrers companywide. They make recognition for referrals special events and use social media to announce them. Employee referrers are celebrated as champions to promote and encourage employee referrals.

This is a great example of making referrals a part of company culture. Thanking employees for referrals and recognizing their efforts keeps the focus on your program while appreciating employee efforts.

Distillery

Like many employers in the software industry, Distillery needed qualified software developers in a tight job market. Their strategy was to ask the current developers to recommend people they know in the industry. In doing so, they found out that their developer employees love new tech gadgets. So they use tech like iPhones and Apple watches in their referral rewards program.

Distillery’s Andrey Kudievsky says giving the newest tech gadgets available in the U.S. to their developers in Russia who can’t get them locally has been very effective. Finding out what your workforce likes most as referral rewards could be as simple as asking them how they’d like to be rewarded.

Find What Works for Your Company

Asking new hires for referrals on day one, creating goodwill by donating to referrers’ charities, or making referral recognition part of your company culture. These are just some economical gamification aspects for your referral program. You can get creative and find out what your top referrers would like best and incorporate that.

Perhaps your local economy or surrounding community has some exciting aspect or outstanding need that would interest and motivate your workforce. Or a points plan for referrers to earn points for prizes for each step in the referral process may be most effective for you. When you are on a budget, you still have lots of options to make your referral program more fun and successful for everyone.

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