If users are promoting my product/service for rewards then won't that hurt their social reputation?
With rewards tied to actual sales and not just clicks or email counts, you ensure that users have incentive to only send message to friends who will actually benefit from your service.
Apart from a direct coupon that the referrer can share, just forwarding information about something that is genuinely useful to the recipient accrues social capital of the user and no way harms it.
Many of the users are very upfront in the message in terms of the reward they are going to claim. In any trade (or purchase of service or product) both parties feel they are better off with the trade than without making the trade.
So the same way you feel good when someone refers you and don't feel awkward in sharing the gain, the recipient who follows the suggestion and makes the purchase feels good and does not mind the referrer made some "profit" while connecting him/her with your valuable product/service.
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