The Marketing Leaders - The ‘DNA’ of B2B Loyalty Management & Retention

Customer acquisition can be costlier in a business-to-business environment, so is loyalty management and retention is even more financially important to your company?

Yet every year marketers still have to fight to stop budgets being cut as business leaders are often happy to invest in a database but then fail to invest further to fully exploit it with a multi-channel marketing campaign which places loyalty and retention as a priority. In fact, businesses should be investing more to ensure that the customers they do have are still going to be customers next year – or that the individual in their database is actually still the same person with responsibility for buying whatever services they are selling.

People move jobs within big businesses almost as often as they change companies. Assuming that their replacement will still want your services if you don’t engage them in the right way is a major mistake. So, firstly, how do you stop your budgets being cut? By demonstrating success – setting benchmarks for your data and database allow you to show what is working and why your budget should never be touched.

Data should be treated in the same way as DNA. You need to be able to interrogate your data to get a clearer picture of customer behaviour in order to work out the most cost-effective way of engaging with them more often:

• Are they driven by product innovation?
• Cost?
• A tailored approach?
• Brand loyalty?

Can you learn from B2C marketing?

B2B marketers can learn a lot from the way that B2C has embraced multi-channel marketing and message personalisation. In particular, the effective use of email by companies looking for a way to engage with their audience in the most interactive and measurable way possible has been honed over the last few years by consumer brands.

By analysing the behaviour of your business customer you can similarly optimise your B2B marketing on an individual basis – right message, right time, right offer – and begin to see a pattern of certain triggers which may make a customer go elsewhere.

Customers don’t mind frequent contact as long as it remains relevant. Your marketing plan should set out to engage with each customer a certain number of times a year based on their own behaviour. For example, can your database flag up when your customer reviews their budget? Their typical purchasing pattern over the course of a year?

Unbelievably, a staggering number of businesses can’t do this. Despite spending money to acquire customers and build a database they stop investing at the crucial point when the quality of their data management can really begin to reap rewards in terms of loyalty and retention.

Loyal customers aren’t always the most valuable though. Being able to interrogate your data to rank the value of your customers to your business is an important starting point.

For example, you may have seemingly loyal customers who only stay with you because you continue to offer massive discount – making them unprofitable. Is it worth marketing to these customers when they are purely motivated by that discount?

To borrow an example from the consumer world, Tesco is one of the finest examples of how to market to loyal customers and further increase their value. The supermarket’s loyalty marketing is so effective that Tesco’s ‘advocate’ customers – those that the business knows recommends it – spend an average of 60 per cent of their supermarket budget with Tesco, compared to just 30 per cent that ‘loyal’ customers spend with its rivals.

In contrast, GB Group’s own research has shown that 40 per cent of businesses don’t even have a policy on the quality of their data and when they update it.

All of these mistakes can seriously affect customer loyalty as they lead directly to five of the biggest customer turn offs identified in our research:

If businesses are still making these simple mistakes, you can guarantee that their customer retention strategies are not that sophisticated.

Developing a contact strategy means that you can segment your customers by recency, frequency, monetary value and then work out their lifetime value to your business before determining your Best Next Action (BNA), but all of these actions become useless if you don’t look after your database in the first place – prove its worth and your company is far more likely to invest in it next year.



		The ‘DNA’ of B2B Loyalty Management & Retention
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