Most of our readers will be members of a B2C customer loyalty program. Supermarkets, retailers, restaurants, and hotels all provide benefits in exchange for your customer loyalty, ranging from discounts, early access to new products, and other exclusive perks that lure you back, again and again, to retain customers and keep you spending.
This has only recently been recognised as a possibility in the B2B sphere. This is surprising, considering that most B2B sales relationships are due to an emotional connection between the brand and the purchaser, mostly doing business with the same companies because you know what you’re getting.
It’s a known fact that it costs five times more to acquire a new customer than to retain existing ones, and on average, your most loyal customers account for up to 80% of a company’s revenue. Creating a customer loyalty program makes sense because these factors are as essential to a B2B business’s success as they are.
Is your brand ready for a customer loyalty program?
Benefits of a Successful Customer Loyalty Program
There are many benefits to creating a successful customer loyalty program. However, we will break down some of them here today to understand how impactful they can be within the B2B market and, more specifically, your business.
Improving Sales and Revenue Growth
With the ability to remain front-of-mind through offers and communication touchpoints that a program allows you, customers are regularly encouraged to try out additional products and services beyond their usual purchasing habits, utilising offers to increase their purchase frequency and lifetime spending.
Using benefits leveraged by seasonality and differing purchasing behaviour to promote sales of higher-margin products, paired with success stories and unique updates, can help your business begin to appear as a partnership with your clients rather than a transactional relationship.
By keeping customers interacting with your brand, you can increase profits and revenue more than you could without a customer loyalty program.
Improving Customer Satisfaction
A successful customer loyalty program can help your brand reduce discounts and heavy promotions, implementing non-monetary benefits that will win your customer base even more. By offering gestures and perks through your program, your customers can create an emotional connection to your brand, putting you at the top of their purchase list while allowing you to reduce spending and turn more of your revenue into profit.
At the same time, by creating an emotional connection to your brand, you can reduce tension in the contracting process and provide greater customer satisfaction, retention, and advocacy. This will give your customers a reason to love your brand and the value they’re able to extract from it—and a reason to tell all their friends and colleagues about it.
Gaining Valuable Customer Insights
Using a digital platform provides multiple levels of value for your customers. It is easy to use and beneficial to keeping your brand front-of-mind when it comes to purchasing time, but the value it provides your business cannot be understated.
By gaining valuable purchasing information from your clients, which can be collated and reported upon, your brand can use these insights to develop new products and services, strengthen customer relationships, and help your and your customers’ companies grow and evolve.
Using digital channels also allows you to segment your communications, speaking directly to your customers and the way they use your brand. This creates personalisation and allows your comms and plans to reach specific segments alongside customer satisfaction.
Five Important Actions to Create a Successful Customer Loyalty Program
1. Understand Your Customers
Any successful customer loyalty program will understand that no two customers are identical, but they will have similarities in the way they use your business and your program. This invites discussion on the importance of customer segments and understanding how each of these interacts with your brand.
B2C customer loyalty programs benefit from a broad communication strategy—send everything out and accept that some will bite, some will miss, and some will move on. With a B2B program, the audiences are much smaller, and your brand will not have the opportunity to follow this same strategy.
This is where the insights that your brand can gain through your program mentioned above in regard to segmenting your audience are important to study and understand. You need to find ways to communicate value to each of these groups, so understanding your customers and their value drivers is essential to success within your program.
2. Identify and Drive Optimal Customer Behaviour
This point is two-pronged—you must understand the current desirable behaviours your customers are eliciting while also knowing the ideal final behaviour you would like your customers to consistently evoke. This could be buying a broader product range, taking up more of your customer’s shelf space, having a flow-on effect from referrals, or gaining more positive reviews to share.
By creating a foundational understanding of what you have and want, you can use design elements to solve the pain points that prevent your customers from displaying these behaviours.
Keep in mind that each customer may have different factors holding them back from being able to behave this way—business size and type, location, and buyer role—so by understanding your customers and their behaviours, you can work together with an agency such as us to build design elements that can be tailored within the program to drive to this final goal.
3. Keep Your Program Simple
Businesses often find that a program will fail because it is not simple to understand and extract value from. From registration to redemption, the process must be intuitive and easy to use, with features that allow your customers to gain value without headaches.
Providing instructions to use and training to internal stakeholders, such as sales teams who will likely be face-to-face with your customers, can reduce any potential issues. Providing speedy support to resolve problems will let your program thrive and help you find ways to connect with the customers you’re seeking emotionally.
4. Digital is Essential
Similar to the above, a simple experience with your program is your key to success. Using digital program platforms easily accessible by mobile or browser will let your customers use your program on the go and are more likely to keep using it.
Conversely, providing digital platforms allows your brand to gain meaningful insights that you would have to work harder to achieve otherwise. Digital programs allow ease of reporting, which provides insights into your customers’ operations and purchasing habits and gives you an easier way to provide relevant offers and communications to them and their business.
The data gained from your program is invaluable for ongoing modification. This allows you to achieve the desired customer behaviour your program should work towards more easily.
5. Customer Experience is King
The best outcome of a successful program is to create passionate and vocal advocates. Your program should be responsive to feedback and insights, creating opportunities for your customers to have positive brand experiences.
Financial incentives can elicit these, but they reduce impact over time. However, with a program that understands your customers and makes them love it, the emotional connection you foster will last a lifetime.