A Merkle B2B customer loyalty study, based on results from an April 2017 survey of 400 North American and U.K. B2B enterprise buyers and sellers, is broken down into three reports that examine how:
Non-financial incentives and business-building services have the power to deepen seller-to-buyer relationships and boost revenues attributed to B2B loyalty programs.
Business owners and B2B buyers identify non-financial incentives and supportive, reliable, business-building services as most critical to their continued loyalty. These value-added services can range from dedicated support to educational content to the certainty of reliable products and services.
Business-building services and reliable products/services – accompanied by high levels of personal attention, professional knowledge, and helpful resources – can strengthen relationships between B2B program providers and members.
B2B members want reassurances that their B2B loyalty program providers can help them run their businesses more successfully.
Loyalty360 talked to Sara A. Hogan, director, growth marketing, Merkle Loyalty Solutions, to learn more about this comprehensive study.
What makes a successful B2B loyalty program and how does or should it differ from a B2C loyalty program?
Hogan: Successful B2B loyalty programs can draw parallels to that of their B2C counterparts, as both are on a path of fostering long-term and profitable behavior change. Of course, methodologies can vary based on the sheer size and complexity of a B2B company though, the end-goals are similar.
For B2B programs, driving CLV might start with financial incentives and immediate discounts, similar to B2C programs. But lasting behavior change comes from uncovering the consumer inside your B2B accounts and understanding their motivators –trust, value exchange and through a deepening of relationships. Like B2C programs, meaningful B2B loyalty programs should define how to use customer data to change behavior, and enhance the customer relationship through personalization and customization, interactive and real-time catalogs, customer reviews and individualized rewards and recognition. It’s about customer-centric B2B loyalty and looking beyond financial incentives to the loyalty-building value of their own business resources and expertise.
What factors will make B2B twice as large as B2C by 2020?
Hogan: With companies like Amazon and Alibaba setting the bar for enhanced customer experience, the B2B world is adopting strategies and methodologies from their B2C counterparts. As the B2B customer relationship is enhanced, so then comes the customer data facilitating the analytics needed to truly understand the complex buying process and the influencers and decision makers are along the way and the most effective messaging to change behavior in key segments.
What are some tangible business-building services for B2B loyalty program buyers?
Hogan: Resources that deliver long-term value become more important, especially if they are built on customer-centric services and guided by B2B seller expertise.
They want B2B partners who listen to their needs before they begin the pitch. They seek knowledgeable B2B vendors who are familiar with the intricacies of their business, sector and industry. Reliant as they are on direct meetings/calls with prospective vendors (59 percent), Internet searches (55 percent), and peer recommendations (51 percent) about viable B2B vendors, they fundamentally want B2B resources and relationships that will help them build their companies.
Sellers of successful B2B loyalty programs must provide the incentives and business-building resources that their buyers want. To do so, they need to change their thinking and better understand their prospects’ and customers’ needs throughout the buying cycle and relationship by researching their prospects and members to truly understand them – the nature of their business, the competitive landscape, their customers, and current industry trends and challenges. Doing so strengthens B2B relationships as a result of shared knowledge and mutual goals.
They must incorporate into their offerings a range of services that are tailored to each client’s fluctuating needs and expectations as their businesses grow, expand, and change.
Among the services that B2B resources can provide are educational programs, training, coaching, data-sharing, competitive benchmarking, value-added assets, trade-related tools, data, industry connections, networking opportunities, members-only perks, specialized consulting services, and access to in-hours experts. An array of resources can be pooled to create the profitable, customer-centric programs that B2B sellers are asked to provide, while also addressing and meeting members’ expectations for value and success.
Once they understand how their B2B members operate, B2B sellers are better positioned to provide the business-building tools, resources, and relationships that will help them compete and prosper. And in doing so, they will boost the profitability and status of their own companies and enterprises.
B2B providers should not overlook the importance of mobile content for their B2B members. Increasingly, business buyers and employees access and consume content in the mobile channel – which is where their B2B programs need to be, with a 2016 Forrester Report finds that 60 percent or more of B2B buyers worldwide agree that the mobile channel is critical to their work – 84 percent of millennials (18-35),76 percent of Gen X (36-51), and 60 percent among baby boomers (52 and older). Similarly, Wrike reports that 44 percent of business employees check mobile devices more than 20 times a day.
How can a B2B loyalty program help strengthen seller-buyer relationships?
Hogan: Business owners want loyalty programs that help them succeed and grow as businesses. They want relationships that cement long-term commitments and establish long-term loyalty. Likewise, B2B sellers can leverage resources and long-nurtured relationships to retain customers, increase members’ value to the enterprise, and meet their goals for increased profitability.
It’s true that B2B buyers do identify financial rewards and prices based on volume/spending as key elements for loyalty program consideration, however, those incentives drop from first place when buyers are asked to identify the program elements that keep them loyal and help them run their businesses. It’s as if financial incentives are viewed as “getting my money’s worth” from the B2B program, yet those incentives wane in importance once a business becomes a member.
Strong relationships between B2B buyers and sellers produce all of the necessary elements that support tangible talk value. Case studies, testimonials, influencer recommendations, and higher Net Promoter Scores (NPS), for example, are likely outgrowths of strong relationships between buyers and sellers. They can also be used to support marketing efforts and increased category visibility. As one respondent in our survey pointed out: “We have found that customer satisfaction is the absolute best way to improve loyalty, sales, and customer retention. Word-of-mouth is by far our best advertisement!”
B2B sellers that establish positive, business-building relationships with their buyers seize the potential to delight not only their customers but also to capture the attention of prospects within buyers' networks. Satisfied B2B buyers are more likely to step in as brand intermediaries−third-party voices who speak positively about their experiences, results, and high levels of satisfaction with B2B sellers’ products and services.
Over time, resources that deliver long-term value become more important, especially if they are built on customer-centric services and guided by B2B seller expertise.
What is the biggest surprise from the series of reports?
Hogan: Loyalty is an intangible outcome of B2B programs. It also functions as a powerful force in the B2B sector for its ability to deepen connections between buyers and sellers and create relationships that are beneficial to their mutual success and growth, similar to B2C loyalty tenets.
Even though various discounts and financial incentives (41 percent to 51 percent are buyers’ most important elements of a B2B loyalty program, non-financial incentives and offerings are becoming more important once businesses join
Additionally, financial incentives/prices are overshadowed by other program elements that help business owners run more successful businesses once they establish a B2B relationship. The elements they value are dedicated support (58 percent), industry knowledge (47 percent), strategy/consulting services (42 percent), industry networking/connections (40 percent), content (36 percent), and educational or business services (33 percent). Financial incentives (52 percent) appear only once among their top 8 most-desired business-building program features.
As loyalty deepens, so do opportunities for “soft benefits” including deeper brand affinity, improved talk value, third-party endorsements, and the ability to influence downstream business and consumer markets.
Reciprocal B2B success between buyers and sellers has the potential to create a positive spillover effect that can help other businesses and consumers enjoy success as well. Informed by this new data, B2B sellers must take time to understand and develop relationships with their B2B buyers, provide services that move beyond transactions and price-driven promotions, create opportunities to turn satisfied clients into brand advocates, and set the stage for building relationships that can extend business success across the broader marketplace.