Loyal customers can represent up to 84% of total site visits and spend 10 times more on your business than on new ones. Also, gaining new customers can cost up to five times more than generating new customers from someone you’ve worked with before.
With these statistics in mind, are you doing enough to instill loyalty in your customers and earn them?
By ensuring that your marketing encourages new customers, brand loyalty, and customer referrals, you’ll give your business a boost that doesn’t come anywhere else. But how do you ensure your customers earn real loyalty so they can do more for your brand?
This article explores how to measure and increase B2B customer loyalty. You’ll learn how to inspire your customers to engage with your brand more meaningfully and help you find new leads.
Measure B2B Customer Loyalty
How is B2B customer loyalty? This is a difficult criterion simply because loyalty can manifest itself in so many ways. However, you can use three metrics to measure customer loyalty:
1. Repeat customers rate (RCR):
How many of your customers buy from you more than once? This measure tracks how long customers continue to sponsor your business after the first sale. Set RCR as your baseline and track it in your Customer Relationship Management (CRM) system.
Use the RCR as a basis for evaluating the success of your loyalty programs and initiatives, and track it monthly to determine the percentage of customers who come back to you as you build loyalty efforts.
2. Customer lifetime value (CLV):
This metric measures the total profit that each of your customers has contributed over the lifetime of your company’s purchase. Use the data in your CRM about annual sales, purchase frequency, and purchase trends to predict the CLV for each of your customers.
By following these criteria, you can determine your highest value customers and understand which practices hinder the loyalty of your lowest value customers.
3. Net Promoter Score* (NPS):
One of the most direct ways to measure customer loyalty, NPS explains how likely your customers are to recommend you to a friend or colleague. With the ability to simplify our understanding of the often complex relationships between businesses and B2B customers, this score is an essential tool for any marketer looking to better understand customer loyalty.
To determine NPS, ask customers how likely they are to recommend it on a scale of 1 to 10. Those who pick 9 or 10 are your best managers—the valued customers your brand is likely to advertise. Take the percentage of customers who are promoters and subtract those who are “renegades” (they give you a 6 or less) to understand the relationship between promoters and detractors.
Each of these three metrics provides valuable data on how loyal and engaged your customers are; together they provide a holistic view of your prospects to leverage customer loyalty in your favor.
Increase—and make us of—loyalty
Especially in B2B marketing, loyalty programs need to go beyond traditional punch cards. This tactic may work for some B2C companies, but the B2B buying process works differently, with a longer buying cycle and fewer opportunities for customers to become repeat shoppers. Loyalty programs must take these two factors into account.
In B2B organizations, the success of loyalty programs depends on their ability to compile a solid database of their customers’ satisfaction with their products or services.
Consider implementing a loyalty survey to collect this data. At my company, we conduct annual surveys to monitor customer satisfaction with the services we provide. From the results, we can see which of our customers are the most loyal and willing to give us more advice. With this information available, we have a solid foundation to strengthen relationships and retain current customers.
Unlike B2C, the best B2B loyalty programs emphasize service, not product discounts. Take the case of BlueLine Rental, a building materials rental formerly known as Volvo Rents. The company analyzed the data to determine the best customers. It introduced “rules for” gloves, especially for high-value customers. According to the new rules, customers can request the service at any time of the day or night: this empowers them and shows BlueLine’s appreciation for their business.
This type of loyalty program allows marketers to bring emotions back to B2B, helping valued customers remain loyal and encouraging beneficial interactions between sellers and customers. As a result, stronger relationships are constantly being built and nurtured.
A strong B2B referral program should be personal and rewarding. Let your customers know that you value their insights and that the time you spend interacting with others values your rewards that really mean something to them.
For example, ReadyTalk, a video conferencing provider, created a referral app that works more like a social network. High-value customers can complete “challenges” online, such as discussing their experiences on social media and filling out surveys to earn points. They can redeem these points for special rewards and services.
In its first four months, this referral program gained 190 referrals for ReadyTalk, reinforced its social media and blog presence, and identified 70 lawyers willing to work as sales referrals for the firm. Of the clients registered by the program, 33% closed their negotiations within 60 days. The company’s typical sales cycle is twofold.
Your current customers are obviously a great way to grow your business, optimize your sales cycle and attract more people to your brand. Are you committed to understanding your current customers and leveraging relationships to grow your business?