Difference between B2B and B2C programs
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At the core, B2B Loyalty programs are designed to reward customers for spending on your products and services and recognise them for doing business with your brand. But expecting loyalty by simply introducing a customer loyalty program or rewards is fraught with danger.
We challenge businesses to review B2B loyalty from the other way round —think Strategy First, Rewards Second. Customer loyalty is an outcome of a targeted B2B incentive, reward or loyalty campaign. Recognise the right behaviours and reward for that effort, and you can build loyalty over the long term.
There is no value in an incentive or loyalty program without understanding the individual or company, market conditions or barriers to success. We look at key business pain points that get in the way of creating loyal customers. Focus on information gathering is the way to attract B2B loyalty.
We often receive briefs asking us for a B2B loyalty program. However, these come with a view of the loyalty programs from a B2C viewpoint when we do. So, without side-tracking into the difference between these segments (B2B vs B2C), let’s look at the performance and potential benefits a pain-based loyalty program can solve.
A B2B customer can provide more revenue in a single transaction than individual consumers over a year or two. This single metric alone demonstrates how the value proposition and loyalty program value should be vastly different.
Customers are inundated with choices. A B2B loyalty program should remove the thought of shifting purchases to a competitor or, even better, give you the opportunity for more share of wallet. Companies who want ways to entice customers to come back and repeat business should also be willing to celebrate the volume of purchases and the time spent on your products and services.
During our design process, we shift the focus to business pain points. Is it: share-of-wallet that hurts? Stagnant sales volumes? Accounts not paid on time? Starting the conversation with pain points forms the basis for a strategy to change behaviours that would achieve business goals. Not only loyalty!
Confused about the terms loyalty and incentives? They are interchangeable, aren’t they? As seen above, the term loyalty program is rather loosely used. This is fine because when someone uses the term loyalty or incentive, or even reward program, the reality is that they’re implementing or thinking of a marketing strategy to engage with customers. And when using the word loyalty often mean longevity with their customer buyers.
But to clear the confusion, an incentive is a program that aims at solving a business problem such as market share, introducing a new product, moving old stock, increasing sales, or create customer loyalty. As a matter of fact, an incentive targeting the various behaviours that solve these types of business problems will also result in customer loyalty towards the organization running the program. that is increasing the number of repeat purchases.
So incentives and loyalty are closely interrelated. But let’s think of it as cause and effect. For example, an incentive program encourages transactions and behaviours that are important to a supplier or vendor relationship with partner clients and customers through rewards.
These behaviours result in loyalty created through recognition, building upon the rewards —encouraging then the relationship, not just transactions and building personal and emotional connections with a brand.
The key here is to target behaviours with an incentive and build B2B loyalty through relationships and recognition.
In a nutshell, an incentive program not only solves business and sales-related pain points, but it can also motivate your sales teams and sales channels, and also establish an emotional connection with customers and change behaviours that will results in loyalty, and support a business in achieving their sales and business objectives.