B2B Customer Loyalty

8/3/2019 B2B Customer Loyalty

1/19

Customer Loyalty


2/19

Defining Customer Loyalty

Customer loyalty is the practice of finding, attracting, and

retaining your customers who regularly purchase from you.

Customer loyalty is not customer satisfaction. Customersatisfaction is the basic entry point of good business practices.

Your small business should provide satisfaction to all your

customers.


3/19

Does Customer Loyalty Pay?

A mere 5 % increase in customer retention can result in a 75%

increase in customer value according to Fred Reichheld, author

of "Loyalty Rules". A great reason to pay attention to loyalty.

Here are more benefits:

grab more sales from existing customer base

help spread word of mouth marketing

identify product/service problems earlier

improve profitability

provide a competitive advantage


4/19

Types of Customer

Loyal Customers: They represent no more than 20 percent ofour customer base, but make up more than 50 percent of our

sales.

Discount Customers: They shop our stores frequently, but

make their decisions based on the size of our markdowns. Impulse Customers: They do not have buying a particular

item at the top of their To Do list, but come into the store on

a whim. They will purchase what seems good at the time.

Need-Based Customers: They have a specific intention tobuy a particular type of item.

Wandering Customers: They have no specific need or desire

in mind when they come into the store. Rather, they want a

sense of experience and/or community.


5/19

Building customer loyalty

Customer loyalty matters because selling more to existing customers is

easier, and cheaper, than finding and selling to new ones.

Loyal customers tend to buy more, more regularly. And they will frequently

recommend your business to others.

3 Steps of loyalty program are

Understanding who your most valuable customers are.

How to achieve a high standard of customer care for all your customers. How to turn your most valuable customers into your most loyal customers.


6/19

1 A total approach

1.1 Make customer care a key part of your business strategy.

1.2 Learn as much about your different customer segments as you

can.

1.3 Develop a brand around your company, products or services.

1.4 Design and deliver a 'customer experience' to address how

you handle customers when they contact your business,

whether by phone, letter or email.


7/19

2 Essentials of customer care

2.1 Encourage employees to deliver high-quality customer care.

2.2 Think of ways to make life easier for customers. For example, a

retailer might provide customer car parking, and a simple

procedure for returning unwanted goods.

2.3 Use appropriate technology.

2.4 Give customers a personalised service.


8/19

3 Customer feedback

3.1 Create opportunities for feedback.

3.2 Contact any customer who has stopped buying from you (a

lapsed customer) and find out the reason.

3.3 Monitor and analyse the contact you have with customers.


9/19

4 Communications

4.1 When marketing -- or selling - to customers, divide them into

at least three groups, and plan a different type of

communication for each.

4.2 Only offer products that match customers' needs.

4.3 Have regular contact with customers.


10/19

5 Entertainment

5.1 For your most important customers, entertain on a one-to-one

basis.

5.2 If you need to entertain large numbers of customers, consider

having an annual event.


11/19

6 Added-value schemes

6.1 A cumulative (or 'retrospective') discount gives customers

money back whenever they reach specified spending targets.

6.2 Some schemes offer customers a discount off their nextpurchase. For example, you may issue discount coupons. If

they are only valid for a limited time, you also encourage

prompt action.

6.3 Some schemes offer the customer rewards.

6.4 Relate your marketing to a specific local or national cause.


12/19

Ten Ways to Build Customer Loyalty1. Communicate. Whether it is an email newsletter, monthly flier, a

reminder card for a tune up, or a holiday greeting card, reach out to your

steady customers.

2. Customer Service. Go the extra distance and meet customer needs. Train

the staff to do the same. Customers remember being treated well.

3. Employee Loyalty. Loyalty works from the top down. If you are loyal to

your employees, they will feel positively about their jobs and pass that

loyalty along to your customers.

4. Employee Training. Train employees in the manner that you want them

to interact with customers. Empower employees to make decisions that

benefit the customer.


13/19

Ten Ways to Build Customer Loyalty5. Customer Incentives. Give customers a reason to return to your business. For

instance, because children outgrow shoes quickly, the owner of a childrensshoe store might offer a card that makes the tenth pair of shoes half price.

Likewise, a dentist may give a free cleaning to anyone who has seen him

regularly for five years.

6. Product Awareness. Know what your steady patrons purchase and keep these

items in stock. Add other products and/or services that accompany or

compliment the products that your regular customers buy regularly. And make

sure that your staff understands everything they can about your products.

7. Reliability. If you say a purchase will arrive on Wednesday, deliver it on

Wednesday. Be reliable. If something goes wrong, let customers know

immediately and compensate them for their inconvenience.


14/19

Ten Ways to Build Customer Loyalty8. Be Flexible. Try to solve customer problems or complaints to the best of

your ability. Excusessuch as "That's our policy"will lose more

customers then setting the store on fire. Read our for more information.

9. People over Technology. The harder it is for a customer to speak to a

human being when he or she has a problem, the less likely it is that you

will see that customer again.

10. Know Their Names. Remember the theme song to the television show

Cheers? Get to know the names of regular customers or at least recognize

their faces.


15/19

Loyalty Program

Loyalty programs have been active in India since 1995, when British

Airways launched the South Asia version of its Executive Club frequent-

flyer program in India. That year, Shoppers Stop, launched its First Citizen

Club ( one of Indias best known loyalty programs.)

Today, loyalty efforts have penetrated every major vertical: hospitality,

travel, retail, telecoms, media outlets, and consumables.


16/19

Loyalty Program

The biggest challenge facing Indian marketers is the one facing marketers

the world over: deriving actionable insight from customer data. While the

more established sectors of fuel retail, travel are fairly established, most

marketers still exist in a patchwork of segments with little knowledge of

how to construct, administer and use loyalty programs.

The Indian loyalty industry is still in its infancy as most programs are very

much standalone, points-driven or discounting schemes. They havent

matured to the extent of providing differential treatment at all customer

interface points. Without segmented databases, its difficult to benefit from

a CRM program.


17/19

Types of Loyalty Programs

Some of the most common types of loyalty programs are

1. Appreciations : Giving customers more of a company's product/service.

2. Rewards: Giving customers rewards unrelated to a company's

product/service

3. Partnership: Marketing to another company's database and allowing

loyal customers to choose their rewards from either company.

4. Rebate: Giving customers money back when they buy more.

5. Affinity: Building a lifetime value relationship with a customer based on

mutual interests and not on the use of rewards.

6. Coalition: Teaming up with different companies to share customer data to

jointly target a customer demographic.


18/19

Loyalty Programs in India

The two examples of the new age loyalty programs emerging in

the retail space in India

1.5 million Customers since August 2006 have

registered for i-Mint, an innovative co- branded

loyalty program with partners like Airtel, Indian,

ICICI, HPCL, and Lifestyle-International. In the

program, cardholders earn points by shopping at

any of the partner companies and will be made

available to 5 million by 2007 end.
http://2.bp.blogspot.com/_RRH3vmny2gI/RxrYO4eu-KI/AAAAAAAAAIs/z-12J8JGfQw/s1600-h/imint.jpg


19/19

Loyalty Programs in India

Similarly, the new Tata Credit Card offers cardholders

the opportunity to earn and redeem loyalty points

across 18 brand categories through one unit. The card,

in association with the SBI card and MasterCard is a

partnership of leading brands across all conceivable

categories like airlines, books, departmental stores,

durable goods, fuel, hospitality, telecom etc. The

program is three tiered and features include: global

acceptance, free insurance of up to Rs. 3 million, and

zero-percent balance transfer charges for up to 75

days.
http://4.bp.blogspot.com/_RRH3vmny2gI/RxrYJYeu-JI/AAAAAAAAAIk/XWPQ7j99afY/s1600-h/TATA-Card-anim.gif

B2B Customer Loyalty

Documents

Transcript of B2B Customer Loyalty