Loyalty programs are often considered more of a B2C tool, designed to encourage customers to buy more products. However, the model can be successfully adapted by companies that cater to B2B clients, and can potentially deliver even more satisfying results.
A B2B loyalty program is a two-way street. This means that, as such, it has to encourage your clients to remain loyal to you, but, at the same time, show them that you feel the same way.
The goal of a B2B loyalty program is not to convince the customer to take an action in order to receive a reward. This is the B2C way of thinking, and, although it can be applied here as well, the greater purpose in B2B is to show the client that you value and appreciate their business. That’s why the focus of the rewards is not on their monetary worth, but on their business value.
In this guide, we’ll walk you through everything you need to know about B2B loyalty programs, so read on!
Do B2B Loyalty Programs Work?
In the B2B sector, your clients are less in number compared to B2C, therefore, each of them is of more value to you. The stakes are higher, and loyalty means more, because losing a single account may lead to massive losses. Furthermore, you and the customer are in the same boat, and you both know the importance of retention. Showing that you are ready to go the extra mile to make your customers feel at home with your brand is something your clients will appreciate.
With the focus on customer experience and customer service satisfaction, creating a B2B loyalty program can not only enhance your services, but improve your revenue. In fact, research shows that to 85% of B2B buyers, the experience a company provides is just as important as its products and services.
To that end, whether or not your endeavor delivers results depends on the way you approach and implement it, and what you want to achieve with it.
The ultimate goal of loyalty programs should be to build a connection to the client and upgrade your business relationship. If you concentrate on achieving this, then yes, the B2B loyalty program has a high chance of delivering results. You may boost customer engagement, improve retention, and even understand your clients better.
However, if you try to copy the B2C model without adapting it to the business environment, you are bound to waste both yours and your customer’s time.
What Defines an Efficient B2B Loyalty Program?
A B2B loyalty program, also known as a reward program, is a client relationship tool that enables companies to enhance the way they nurture and retain clients. Organizations may use it to improve the brand experience, define a client development path, or boost product adoption.
Let’s have a look at what defines an efficient B2B loyalty program:
- Understanding Your Customer. Unlike in B2C, the customer here is not a single person, but a group of people united under a brand name. However, each of these people is driven by different needs and, thus, different things may be of value to them. Therefore, you should first work on understanding the company as an entity – values, goals, ethics, etc. – and then focus on the needs of each relevant decision-maker.
The next step is to evaluate their role in the sales cycle and decide whether you should incentivise one or all of them, and how.
- Designing Approaches for Different Customers. If you work with different types of businesses, you should consider the nature of their decision-making process. Presuming that these are too different, you should provide variations in your program to fit them best.
For example, if you are in mid-market sales, the sales cycles and business communication there can vary greatly between lower and upper tier companies. Approaching them in the same way will result in an inefficient program.
- Providing Business Value. In B2C, loyalty programs usually revolve around the eligibility of the customer for a lower price or discount. However, as mentioned, in B2B the focus should be on business value.
Therefore, the program should enable the customer to improve and grow, and take better advantage of the products and services the company offers.
- Testing Different Tactics. Every B2B loyalty program is unique. To be efficient, it has to reflect both the company’s values and product qualities, and the client’s needs. That’s why it may be difficult to get it right on the first try.
You can test enhancements and new ideas with small groups of customers, and implement them at scale if they are successful.
- Good Communication. Maintaining communication with your clients and encouraging feedback will enable you to understand how well the program works and what can be improved. Furthermore, it will enable you to help your customers better understand the program’s rules and advantages, and keep them engaged.
In addition, gathering insights and acting on them will enable you to hit the sweet spot where both sides benefit.
- Relying on Data. Tracking KPIs and performance data will show you in black and white what results the program delivers. You can also talk to your clients, distribute surveys, and gather qualitative data to consolidate what the statistics show.
As mentioned, the greater purpose of a reward program is to retain your customers and contribute to your relationship with them. If data shows it doesn’t deliver, you should consider changing your approach.
- Setting Clear Rules. In order to partake in the program, it’s very important that the customer understands and complies with the rules. This will enable them to understand the benefits and know what they have to do to obtain them.
Complicated programs with too many conditions can be confusing and discourage customers from trying them out. Also, it may make it difficult for your program managers to keep track of what’s going on.
Types of B2B Loyalty Programs
There are a number of different approaches that you can try when designing your loyalty program. These can be mixed and matched, or you can stick only with a single tactic depending on your preferences.
- Point-Gathering. Your customer unlocks access to bonuses and incentives, when they gather a certain amount of points. These can be assigned to the company as a whole, or can be bestowed upon individual users.
Points can be associated with various actions and behaviors, depending on the type of business. What the customer receives in exchange can also vary – discounts, brand swag, access to additional features and services, early access to new releases, membership and discount cards to third-party providers, etc.
- Tiered. Tiered programs may be presented in the form of membership or subscription plans. Customers can choose which category to enter or can be upgraded by the company based on different factors.
The more the client adopts the product, the more they use it, or the more features they request, the more bonuses they receive.
Furthermore, higher tiers can also be associated with faster customer service and other benefits, which may encourage accounts to upgrade.
- Complementary. This is the simplest type of loyalty program. It involves occasionally providing small gifts and surprises to your clients to show your appreciation. These can be gift baskets, company swag, event tickets, and so on.
Complementary programs can easily be integrated into other approaches to deliver more value to the customer.
- Partnerships. You can arrange with your partners to provide preferential treatment to your best clients. This can be in the form of an affiliate program, where both you and your customers get preferential fees from third-party providers. Or you can negotiate conditions to grant your customers free access.
- Individual. Loyalty bonuses to high-end accounts can be individually negotiated depending on their unique value to the company. If you work with a limited number of customers who contribute large amounts to your revenue, you can design programs that best fit their needs.
- Luxury Packs. Depending on the business and clients, a B2B loyalty program can be designed as a luxury pack or VIP club. In this case, businesses can charge their clients a participation fee reflecting the status that membership provides. In exchange, the company should offer a list of services desirable to the customer, that will compel them to participate.
B2B Loyalty Program Best Practices
Here are some B2B loyalty program best practices you can consider when creating your own:
Personalized Customer Service
High-end accounts or clients who are otherwise eligible for your loyalty program, may benefit from personalized customer service. This means that when they contact you, they will always communicate with the same account manager who will be well-acquainted with their individual plan, profile, and history of interactions. This way, they can always count on a personalized solution that answers their needs.
This level of personalization can also be achieved with a CRM software. However, nothing makes a customer feel special and cared for like personal attention. Furthermore, when the rep becomes familiar with the customer, they can provide valuable insights on how to keep them happy, retain them, and make perfectly-timed upsell offers.
Multi-Level Benefit System
In B2B communication, there is rarely a single person on the other end of the line. While this may be the case if you are servicing small businesses with compact teams. In general, a company that has a complicated sales process with multiple stakeholders involved, needs you to decide exactly who benefits from your program.
One way to approach the situation is to focus on the person who uses your product the most. For example, if you are providing accounting software to a large company, the person in mind would be the accountant. Offering incentives in the form of access to advanced features, usage advice, and educational content, could help them do their job better. This may encourage the accountant to convince their boss to keep paying the subscription, and even upgrade.
However, it’s not necessary to limit yourself to only one person. You may decide to send a gift basket with goodies to the whole financial department. This will lift their morale, and may improve productivity, therefore, it will keep upper management happy as well.
Furthermore, you can also consider offering the business owner access to exclusive offers to products or services from other companies you have partnerships with. Or you can provide sponsorships to causes that the company supports.
The details of whom to offer what incentives depend on your company and your loyalty program. The point is that a multi-level benefit system ensures that you approach your client from different angles. It enables you to address the individual needs of all decision-makers and provide a top-notch experience.
Educational and Professional Bonuses
One of the best ways to incentivise your customers is by offering educational content and professional knowledge. This is the essence of a stellar B2B loyalty program and can provide the most business value.
By helping clients to improve their workflow, become better at what they do, learn new skills, and so on, you enable them to achieve their business goals more efficiently and grow. Leveraging this approach can enhance your business relationship and inspire a meaningful and long-lasting partnership.
There are various ways to this, but some of the most prominent ones are:
- Customer Onboarding
- Personalized Training
- Access to Industry Research
- Relevant News and Content Subscriptions
- R&D Partnerships
- Industry Seminars and Retreats
- Skill-Upgrade Courses
- Business Consultancy
People often underestimate the value of fun in a B2B environment. However, both management and employees are still just people, and making your loyalty program engaging and compelling can only contribute to its success. How you implement this depends on the company’s profile and the type of decision-maker you are targeting.
One way to approach gamification is to set up a loyalty program dashboard, where the client can monitor what points they gather, what benefits they unlock, and what they can look forward to.
If your product is operated by a team, you can also add a pinch of competitive spirit to the game, and provide incentives based on usage. The more a team member uses the product and the better advantage they take of its features, and the more points they collect.
However, make sure that the rewards are not of a high monetary value, because this can spoil the fun, and compromise the purpose of the loyalty program. After all, your goal is not to set the team against each other, but to help them improve and have fun at the same time.
When businesses want to understand their customers better, improve products and services, and find ideas about new endeavors, they conduct customer research. However, busy professionals may not always have the time or willingness to enter focus groups, partake in interviews, take surveys, or be observed as they work.
Integrating these activities in your B2B loyalty program may incentivise people to change their minds.
This will enable you to gather valuable knowledge and insights. Furthermore, it will show your customers that their opinion matters, especially if you implement some of their ideas and suggestions in your process. A gesture that will not only strengthen their connection to your business, but will enable you to grow and improve as well.
B2B loyalty programs can be a valuable asset in your arsenal of customer nurturing and retention tactics. They can enhance the bond you have with your clients and take your partnership to the next level.
However, to make this happen, you have to design your program around the business needs of your clients and assure them that you can provide real value. Whether this will be in the form of educational content and growth initiatives, or by simply pampering and engaging their employees, the point is to show that you care.