It’s much more cost-effective to keep your existing customers than to find new ones, so loyalty schemes to reward your B2B customers are a good way to improve your business performance and increase revenue through repeat purchases.
Adobe says that an existing customer is nine times more likely to make a purchase than a new customer, so it’s well worth the effort. Importantly, your existing customers will spend 30% more on average than new ones. Retaining 5% of customers could increase your profits by more than 25%.
What is a B2B customer loyalty program?
A customer loyalty program will encourage your customers to make repeat purchases by offering discounts, unique offers, and special events, for example.
You have probably received a loyalty card from your favorite coffee shop where you will be given a stamp on your card with every purchase. When your card is full you can have a free drink or discounted food. The principle of a B2B customer loyalty program is the same and while there are many different approaches, they are often based on building up points to exchange for benefits.
When properly planned and implemented a loyalty program can help you to:
- attract new customers
- keep existing customers
- encourage flagging customers to re-engage
- persuade buyers to purchase more or different items.
B2B customer loyalty tactics
Get the details right – it’s important to make sure that all the details – large and small – are carefully thought through and documented in the terms and conditions of your program. You will be focused on the actions and behaviors you want to encourage but confusion and inconsistencies will do more harm than good.
For example, you might want inactive accounts to take part but you will have to decide how they will qualify. Equally, if a customer’s account becomes inactive, how long will their points remain available as an incentive for them to return? How strict will your rules be? For example, if someone needs to spend $100 for a point but only spends $99 will they qualify with the first $1 of their next order? Will you set a time limit on your program or a date when it will be reviewed, and what will happen to points after this date?
Add loyalty rewards to your customer experience plans – eight out of 10 B2B buying decisions are influenced by customers’ experiences and only 20% of choices are based on price alone. Feedback from your sales and marketing teams can help you improve satisfaction and help define the right type of program to offer.
To make the best possible decisions you will want to take advantage of analytics to be sure you can provide informative, engaging, and consistent customer experiences. This will be the foundation of their continued loyalty to your brand and can help you to persuade them to subscribe for additional benefits.
Make data-based decisions – accurate data is essential for a successful and effective loyalty program. You will need reliable technology and processes to make sure you can accurately collect and use data at every touchpoint with your customers. If your records are inaccurate or take a long time to process you will undermine the success of your program. You will also want to know what sort of return on investment your program delivers and learn from your successes.
Ideally your enterprise (ERP) and customer relationship management systems will already be integrated with your B2B ecommerce platform to provide a single source of accurate customer information so you will be able to track the impact of your loyalty program, almost in real time.
B2B loyalty programs that work
One of the world’s best-known electronics manufacturers, Lenovo, acquired IBM’s X86 server division and wanted to retain the existing business partners. The company created an Expert Achievers program using education as an incentive. Their partners received points for completing educational modules and tracking their sales performance, and could convert sales into points.
In the travel sector Celebrity Cruises created a loyalty program for travel agents who provided most of their sales. Their easy to use portal allowed agents to record their bookings and build up points. They received extra points for upselling additions and enhancements. During the initial three month campaign they could earn up to £500 in points on a leader board, depending on their position, helping to increase the company’s revenue.
Leaders in the automotive aftermarket, TRW created the Automotive Diamonds loyalty program to help improve communication with their audience, connecting workshops across Europe. Workshops could sign-up and earn points for purchasing products and redeem their points for rewards of their choice. TWR used the data collected to further customize their loyalty program.
Your reward options
Each of these examples offered tailored the rewards to meet the needs of customers and benefited from valuable information and increased sales. There are all sorts of approaches you can adopt; here are just a few.
Tiered rewards will motivate your loyalty program participants to gain more points for higher value rewards. Alternatively, you can incentivize them to refer new customers.
Perceived value like Lenovo’s educational package gives customers an additional benefit for remaining loyal or you could collaborate with other partners to create value-added packages.
Depending on your business you could simply offer discounts, vouchers or coupons for high volume orders before a deadline, for example, or award points based on order values.
A ready-made customer loyalty solution
You can take advantage of user generated content (UGC) to build trust, offer coupons, discounts and other incentives and manage multi-tier programs. You will also be able to make the most of your information to segment your buyers on the basis of points, purchases or referrals for example
Book a free demonstration today to discover more about increasing customer loyalty with Cloudfy.