Rethinking B2B Loyalty Programs (Part 4)

Commentary – 3

The Loyalty Leap for B2B by Bryan Pearson writes about the 4 Rs of B2B loyalty:

Relationships: With B2B loyalty plans, our direct communications will not always be with the end user or decision maker. If we are working with a large enterprise, for example, our contact might be a buyer, several function heads, or representatives, but it is unlikely to be the CEO or the chief marketing officer. The information gleaned from talking with one or two of these contacts is likely to be too vague to meet the needs of decision makers. To make up for this, we must implement broad data collection and disciplined customer information use.

Rewards: B2B organizations must differentiate themselves from their competitors with “soft benefits” or experiential perks, such as training events that lead to certifications or introductions to key vendors or partners. Channel marketers, in particular, are receptive to experiential rewards because the contacts are often sales representatives whose compensation is a mix of salary and incentives.

Recognition: Unlike rewards, recognition is not doled out based on the accumulation of points or miles. It is tied to longevity, customer potential, and transactional history. Recognition is the equivalent of sending a handwritten appreciation note or simply doing someone a favor. n fact, recognition is most often delivered on a person-to-person level.

Relevance: Relevance means knowing where the client is at a point in time, because understanding where the client is in the purchasing process and the associated needs both affect how a marketing message resonates. It also means understanding life stages.

Loyalty Programs: The Complete Guide by Philip Shelper and others writes about how the characteristics of B2B programs tend to be different to B2C programs in six fundamental ways:

Member base size: B2B programs generally have smaller member bases than B2C programs… This provides B2B program operators with an advantage; a smaller member base makes personalisation of communications and services much more achievable.

Member base spend: on average B2B programs generally provide greater value to members than B2C programs. This is because B2B customers tend to spend more than B2C customers, allowing the company to return more value to the business customers as rewards.

Purchasing drivers: businesses have different purchasing approaches to consumers, which necessitates variations in program design. businesses buy to enhance profitability, productivity, payback, and operational ease and maintenance, make slow and complex decisions, receive relevant marketing primarily via direct one-to-one presentations and discussions, and are overly sensitive to technological changes.

Relationships: a B2B relationship may be between multiple participants, including owners, initiators, influencers, deciders, users, buyers and gatekeepers.

Fundamental challenges: the design of a B2B program needs to accommodate three fundamental challenges; ethical, communications and employee longevity.

Reward variations: B2B programs…also tend to include the businesses own products, direct discounts, free education courses, access to events and conferences, and other benefits more suited to the needs of particular customers.

The authors add: “B2B programs should strive to build customer commitment to the brand. Gilliland and Bello (2002) identified three important characteristics specific to loyalty commitment within B2B relationships; it makes it difficult to exit the relationship, partially because loyalty sentiments motivate participants to work out problems rather than leave; it suggests a preference for one company over their competitors when making supply decisions; and, it maintains the relationship even if the decision may be economically irrational.”

One aspect of B2B sales process is the involvement of channel partners. Cristina Ziliani wrote in Loyalty Management about an analysis of 420 cases which contained premium and prize promotions, spanning 20 industries and 25 years, from 1990 to 2015.

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.