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Customer loyalty Customer loyalty in B2B
Customer loyalty means just what it says. It’s an enduring positive relationship between a customer and a company or brand. The customer is not contractually bound to the relationship so they are not under any obligation to buy a product or service. Rather, the customer decides for themselves that they want to buy the product or service from this company or brand. But how can customer loyalty be nurtured? Which methods can companies use to increase customer loyalty? Find out more about customer loyalty in this blog post.
What are the benefits of high customer loyalty?
In the best cases, customers who show high customer loyalty actively recommend the company or brand to others. So customers become effective brand ambassadors. This generates the vital marketing instrument known as referral marketing. Referral marketing is an instrument for new customer acquisition. Studies indicate that this marketing instrument is less expensive and more successful than traditional advertising. Referral marketing is also an excellent multiplier. This means that for every satisfied customer, a company receives an average of nine further recommendations. Trust in a company, product or service is much greater if it has been recommended.
How is customer loyalty nurtured?
Customer loyalty doesn’t just generate itself. It’s nurtured through long-lasting and positive customer experiences with the company, brand or service. This seems very simple and good in theory. The challenge is to implement this in a Business-to-Business (B2B) company. Here are some suggestions from my own experience:
- Understand what the customer wants and what will not only satisfy them but also thrill them with the company or product / service.
- Use personalized customer data.
- Keep in touch with the customer and keep asking for feedback.
- Develop and implement a customer loyalty programme.
All four of these methods are important. But I’d like to look in detail at the fourth method, the customer loyalty programme, as it can bring many benefits. For this reason, every company should develop and implement such a programme.
The benefits of a customer loyalty programme
With a customer loyalty programme, companies or brands can increase their revenue and their Customer Lifetime Value, known as CLTV for short. Members of a customer loyalty programme usually generate 10-15 percent more revenue per year. These loyalty programmes are frequently linked to various bonuses or discounts. In B2B, these should be adapted and have different incentive systems in the place of additional bonuses or discounts.
Why is customer loyalty so important?
In B2B, customer loyalty is vital to the success of a company, brand or service. B2B has fewer customers compared to Business-to-Customer (B2C) companies. B2B companies buy more per order and, if it’s done right, they’ll buy continually, which generates sustainable revenue. The aim should be that the customer not only wants to buy there but also feels that they have to buy there.
How can customer loyalty be measured?
Customer loyalty can be measured using key figures such as customer retention rate, customer churn rate and customer lifetime value. The interval and the measurement method also depend on the sector the company is active in.
Customer loyalty means that customers always return to a company or brand. And they do this of their own free will. This customer group is very valuable to companies and brands because they are not only loyal but are also frequent brand ambassadors. Customer loyalty can provide a vital advantage over competitors. It plays a crucial role, especially in a saturated market.
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