Referral Marketing is a strategy where businesses encourage existing customers to recommend their products or services to others. This approach leverages the trust and relationships that customers have with their friends and family, making it a powerful way to attract new clients. Often, companies offer incentives, such as discounts or rewards, to both the referrer and the new customer to motivate these recommendations. By utilizing word-of-mouth promotion, referral marketing can lead to higher conversion rates and customer loyalty. It is cost-effective compared to traditional advertising methods, as it relies on personal endorsements rather than paid promotions. This creates a win-win situation for both businesses and customers.