BBecause B2C and B2B customers are different in so many ways, B2B companies usually treat their enterprise clients with greater moderation and reserve compared to how they approach retail buyers. But there are also things they have in common. Both B2C and B2B businesses are ready to go the extra mile to foster closer relationships with their customers and win over their loyalty. On that account, customer loyalty programs have achieved massive recognition in B2C marketing as an undeniable customer retention strategy. But what about B2B? Could it work as effectively for highly rational corporate buyers? Is there any business value in B2B customer retention strategies, and if so, what should be considered when planning to launch a successful B2B customer loyalty program? Ultimately, it all comes down to customer engagement and care.
Loyalty Programs and Their Business Value
Nurturing customer loyalty is essential for B2B companies since it allows them to build long-term relationships and, eventually, have access to more opportunities with their clients. Unlike B2C, B2B customers represent a much greater pool of potential business engagements, which may be also incredibly unique. Boosting your customer retention metrics translates into referrals resulting in greater brand awareness, new customer acquisition, and new cross-sell/upsell opportunities.
Granted, the quality of your products and services will be the foundation of your customers’ satisfaction. No loyalty program would compensate for that. But if you want your customers to look forward to every new business interaction with your company, B2B loyalty programs are definitely the key point.
What Makes a B2B Customer Loyalty Program Different from B2C
The B2B segment uses more personalized customer engagement strategies and unique value propositions depending on each individual client’s needs. Before approaching business customers with a loyalty program, one should assess the following:
- Business customer’s buying potential along with their buying habits
- Which stakeholders should be addressed and how best incentivize them
- Importance of value propositions: the vast majority of B2B buyers are rational to the bone, which is why loyalty programs launched for B2B should focus primarily on business benefits and other value propositions
- The line of business specifics, popular loyalty programs in the customer’s business domain, and the customer’s B2B model type (e.g. a loyalty program for a manufacturing company selling to retailers vs. a loyalty program for a company providing its services to a manufacturer should not be the same).
Planning Customer Loyalty Strategies and Key Factors for Success
To start developing a meaningful B2B loyalty program, you should first define how to use customer data to continuously enhance customer relationship. B2B organizations typically have a smaller customer base than consumer-focused businesses, which makes it possible to carefully analyze their buying habits and then create a best-fit loyalty program strategy.
Here’s what to start with:
- Define your profitable accounts and customers
- Ensure you understand the strategic goals of your business and tailor your loyalty programs respectively
- Consider each customer’s business model and come up with a set of personalized, value-driven loyalty programs
- Research customers and monitor interactions with your customers throughout all touch-points
- Segment your customer base to target each segment in the most effective manner
- Develop a system for scoring and ranking the most valuable customers
- Initiate and encourage dialogue with your clients; collect customer feedback
- Continuously analyze which incentives facilitate win-win relationships and help you meet your business objectives
Successful Loyalty Program Examples
1) Using tier incentives
Tiered incentives ignite customer engagement right from the start and prompt business clients to purchase more. You can begin with basic membership rewards to encourage customers to sign up for the loyalty program and offer more valuable rewards to your repeat clients as they increase their purchasing volumes.
An equipment manufacturer provides rewards to its distributors based on their sales performance in the form of earned points. By gaining more points, buyers can level up from one tier to the next. Leveling up to the next tier can offer more benefits, better pricing, or other incentives.
2) Partnering with third parties and resellers to give customers extra value
By establishing a strategic partnership with a company providing complementary products or services, you can position your business as a one-stop shop for your customers’ diverse needs and thus increase your customer engagement opportunities. Creating loyalty programs for your distributors and resellers is another important strategy that helps you build a strong distribution network, increase brand awareness, and have more customers.
If your company sources raw materials used by other businesses for production, you may partner with a company that offers services that can streamline production. As a company selling tires to a B2B auto parts manufacturer, you can partner with a windshield reseller and offer your customers a combined package at a discount price. As a petroleum company, you may reward your clients with bonuses and thus promote your brand among mechanics, who usually decide which engine oil and other products to use at their car service.
3) Arranging member events
As a rule, enterprise customers tend to build long-term and sustainable relationships with partners and suppliers. In this regard, in-person events give businesses a great opportunity to recognize their clients, strengthen mutual ties, and discover their product experience first-hand.
An email marketing software provider arranges both free and paid conferences, trade shows, meetups, and retreat events for its B2B users to increase loyalty and educate them on the industry-related issues.
4) Providing transaction-based immediate discounts
This loyalty program echoes a B2C approach; however, it perfectly fits with the B2B environment. When completing an order, customers are offered an exclusive discount that can be applied to the current or future purchase. This method is used to encourage clients to join the loyalty program membership.
A textile clothes distributor selling to apparel shops offers an instant discount applicable to every order made within a certain timeframe.
5) Running referral programs
Referral programs are among the most popular and easiest to implement loyalty programs. They are commonly created in such a way so that you have more bonuses as you invite more customers. Newly referred customers are eligible for this bonus as well. This makes participating in the program a win-win for everyone.
A B2B SaaS service provider offering business applications in the cloud gives extra user capacity for new referrals as well as an extended package to the newly referred customers.
6) Arranging co-marketing and support activities
Running co-marketing campaigns together with your partners is – apart from being an effective loyalty program – a great customer acquisition tactic. Splitting the effort and cost between two or more parties will let you participate in more trade shows, have a broader email marketing reach, and drive more traffic to your website via content remarketing. As a bonus, you can also offer your partners extra support and training hours.
A Telecom operator represents its new cloud service platform on a global technology show together with its key software development partners.
7) Setting up personalized buying experience via B2B eCommerce website / mobile app
In the age of digital automation and B2B eCommerce, there is one simple method of managing monetary rewards and discounts for your clients – and that is a personalized online buying experience. <Click to retweet> You can use modern eCommerce technology to set up customized product catalogs and price lists on your web store, which further empowers your clients with 24/7 self-service capabilities. Integrate it with a CRM solution to have full visibility into your customer data and see where you can optimize.
Focus on the Customer: B2B Customer Loyalty Programs are Part of a Bigger Strategy
No matter what the business model is, customer-committed companies are willing to design gratification programs to cultivate loyalty in their clients. Establishing and rewarding relationships with the customer base has immense economic value since retaining an existing client offers greater ROI than winning new clients.
However, building effective loyalty programs in B2B requires in-detail personalization and a holistic view of your customers to clearly perceive their expectations and needs. Mixing personalized buying experience with practice-proven loyalty program strategies will offer an enormous renovation to your company’s customer care profile, which is the biggest part of your brand in B2B.
Note: The OroCommerce Marketplace has an extension for managing a B2B customer loyalty program. You can use it together with your OroCommerce solution to set up tiered memberships, time-limited promotions, and targeted rewards. Be sure to check out the extension at our Marketplace.