How to define loyalty programs for B2B buyers
A recent study shows that 82 percent of B2B marketers spend more on customer acquisition than retention. Whereas, only 48 percent actually prioritized B2B loyalty. And, we all know customer acquisition costs more than retention. More so, customer retention is easier and more cost-effective to execute.
However, a loyalty program must be valuable to the customer to win loyalty. Hence, the need to define your B2B loyalty program. What makes a great loyalty program great?
Let’s find out.
Differences Between B2B and B2C Loyalty Programs
B2C loyalty programs are suitable for engaging, retaining and rewarding consumers. Hence, they focus on customers’ emotions.
Meanwhile, B2B loyalty programs focus on business goals, cost reduction, revenue and profit growth, and customer engagement.
How to Define Loyalty Programs for B2B Customers
Here’s a step-by-step process to define your loyalty program for your B2B customers:
- Know your profitable customers and why they buy
- Feedback loop: listen to your best and worst customers
- Find patterns from customer feedback and data
- Align business goals with your customers’ motivations
- Incentivize customer motivations that align with your business goals
- Analyze results and improve your rewards program
Let’s explore these steps in detail.
Know Your Profitable Customers and Why They Buy
Image Credit: Medium
Your most profitable customers spend the most money on your business. Identify all the shared characteristics of your best customers.
Next, find out why they buy from you.
Are they buying because they’re getting a bargain? Do you sell the best quality product or service? Is your offering unique in any other way? Or is proximity the critical driver — are your best buyers shopping from you because you’re the nearest vendor to them?
Find out why your best customers buy. Use surveys, get on a call or take them out for lunch.
Feedback Loop: Listen to Your Best and Worst Customers
Image Credit: Medium
Now that you know why your top buyers buy, you want to figure out why that buying behavior isn’t happening across the board.
Specifically, you want to know why your other customers are spending less than your top buyers. Why haven’t they switched their business entirely to your competitors?
Set up customer feedback loops, to gather intelligence about:
- Your customers’ business goals
- Their key decision-makers
- Competitors they’ve contacted
- Why they might use your competitors
- Data to uncover vital customer motivations
It’s those motivations that will drive your loyalty program.
Find Patterns from Customer Feedback and Data
Data helps you draw patterns. They help you see hidden truths about your customers, their motivations and how you can serve them better.
Using analytics to draw insights from the data you have and ultimately, find out what customer motivations make them buy from you.
You want to leverage B2B customer feedback tools like Medallia, NICE, Qualtrics, Foresee, and others, to understand your customers and discover valuable patterns.
Align Business Goals with Your Customers’ Motivations
Once you’ve discovered your customers’ deepest motivations for buying from you, it’s now time to align those motivations to your business goals.
Scaling your business is good, but keep in mind that 74% of businesses fail because they are trying to scale too fast. So, always make sure to keep your costs down and spend where necessary.
Customers won’t join your loyalty program because you have one. The businesses you serve must see how joining your program helps them:
- Save costs
- Generate leads
- Increase profits or revenue
- Reduce churn
- Improve user engagement
- Increase NPS
- Enhance CX
If your loyalty program isn’t giving businesses one or more of these benefits, they are less likely to subscribe or remain active in the program.
Incentivize Customer Motivations that Align with Your Business Goals
Now you know what your customers want, therefore, incentivize them to realize those desires through your loyalty program.
If your customers want to improve their CX offer a customer experience incentive that’s attached to using your product or service.
For example, the American Express Partner Plus program helps businesses offer their clients financing and expense management solutions powered by American Express.
Analyze Results and Improve Your Rewards Program
Loyalty programs may not work smoothly right off the bat. So, give it some time, and then use the data you gather and your user experience reports to improve the program.
B2B Loyalty Program Examples
Now let’s examine some of the best defined B2B customer loyalty programs.
HP Planet Partners Rewards Program
This program encourages businesses to partake in HP’s recycling initiative by returning used original HP cartridges. So, the program appeals to environmentally conscious businesses.
Businesses can redeem their points with gift vouchers to buy HP products from authorized partners. Designated HP collection agencies pick up these cartridges from over 60 countries every month.
Nufarm Priority Partnership
The Nufarm Priority partnership loyalty program rewards customers for buying a wide range of Nufarm products.
Once you sign up for the program, you’d start earning points when you buy qualifying Nufarm products. You can redeem these points from a wide range of products which include homeware, sporting equipment and more.
American Express Partners Plus
It's a referral-based B2B loyalty program between the American Express Global Corporate Payments and interested businesses.
You'll get incentives when you successfully refer your business contacts to any of the Corporate Card Solutions.
American Express only requires that you make the referral, and they’ll close the sale for you.
Defining loyalty programs for B2B customers requires attention to detail. It’s your customers’ motivations that will drive the program. If you miss it there, you’ve missed the mark.
Guest Contributor: Roberto Garvin is a co-founder of Mofluid.