B2B Customer Retention: How To Improve Your B2B Loyalty Program Pt. 1
As we previously discussed in our two-part series on B2C customer retention, It costs more to acquire a new customer than to retain an existing customer. The same holds true for relationships with B2B customers.
The goal of any company should be to increase sales through customer retention. According to the Harvard Business Review, it can be “25 times more expensive to bring on a new customer than to keep an existing one.” A research study by Bain & Company revealed that B2B companies can expect between a 25 to 95 percent increase in profits with just a 5 percent boost in their customer retention rate.
In most B2B markets, your business will deal with a small number of customers, which means that retaining each customer is integral to the ongoing success of your business. Enhancing the customer experience will make your brand more valuable to businesses, leading to “sustainable, predictable, and profitable growth,” according to Sean Geehan, author of The B2B Executive Playbook. So how can you build loyalty and increase your value to existing clients?
A B2B customer loyalty program is a great way to improve customer retention and keep your existing customers happy and loyal. However, a B2B loyalty program is different than a B2C loyalty program. A B2C company may want to focus on mass appeal in order to make as many customers as happy as possible, while a B2B loyalty program should be focused on keeping specific VIP customers (businesses) engaged. The aim of a B2B customer retention program is to deepen existing relationships.
Here are a few strategies to improve your B2B loyalty program:
Promote Your Brand Values
According to a study conducted by Google and CEB, B2B customer loyalty is influenced more by a company’s brand values and trustworthiness than business value. Surprised? It is far more likely that a company will do–and continue to do–business with you if they can understand and identify with your brand values. Let your brand values show through in your loyalty program. How you communicate, the types of rewards you offer, and the way you communicate with loyalty participants all matter. Ensure that your loyalty program aligns with your brand values, and watch as your customer retention rates increase.
Stand Out From Your Competition With An Extraordinary Customer Experience
As a result of industry standards and regulations, it can often be hard for B2B companies to stand out with their products. But there are other ways to get noticed and improve customer retention. The customer experience is not reserved only for B2C interactions–thanks to technology, there are now new ways for B2B businesses to deliver an extraordinary customer experience. A loyalty program–such as an open-loop prepaid card–that offers freedom, choice, flexibility, and leverages mobile technology to improve communication via push notifications, text, emails, and other direct digital messaging will enhance the lives of your customers and keep them coming back.
Convenience = Customer Retention
According to multiple studies, convenience plays a major role in customer retention. For B2B customers, convenience is especially important. With busy demands and the rigours of running a business, these companies need a streamlined loyalty program that is fast, easy-to-use and matches their lifestyle. A mobile-optimized loyalty program or loyalty app that offers instant rewards, up-to-the-minute program updates and promotions, electronic documentation/invoicing, and more, is exactly what they are looking for.
Collect Customer Data To Personalize Marketing & Improve Communications
Data collected from your loyalty program will help your business create a more complete picture of B2B clients, offering valuable insight into their purchasing habits, spends, wants, needs, etc. A single, streamlined, multi-platform loyalty service allows sales and marketing teams to integrate and work together, tracking sales, leads, redemptions, improving customer communication and personalization.
In B2B markets, a small group of loyal customers can mean the difference between success and failure. Improving your customers’ experience via a customer loyalty program is a great way to increase retention. In part two of our ongoing series, we’ll show you more ways to improve your B2B loyalty program.
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