Building and maintaining loyalty in a customer-driven World

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Loyal customers spend more, spend longer, and help sell more via peer-to-peer recommendations. For b-to-b marketers, achieving customer loyalty reigns supreme. But in our customer-driven economy, loyalty—the thing we all want and need—has never been more elusive.

Surprisingly, marketing is still overly focused on customer acquisition. One rule-of-thumb estimates that new customer acquisition costs five to seven times customer retention. Yet, over 80% of marketing budgets are spent on customer acquisition initiatives, making customer retention the overlooked diamond in the rough.

Loyalty represents the strength of our customer relationships, customer engagement and in turn delivers revenue. According to Marketing Metrics and eConsultancy, loyal customers spend five to nine times more than first-time buyers.

As B2B marketers, how do we improve customer loyalty?

Know Your "why." In the words of Simon Sinek, "start with why." Understanding the higher order purpose of your business—beyond the "what" (product, price) or "how" (quality, service)—is the key to creating a compelling and sustainable reason for customers to engage.

Remember the story of the three men building a brick wall? A woman asks the three men what they are doing. The first replies, "What does it look like? I am building a wall." The second man replies, "I am building a wall to make a paycheck." The third man replies, "I am building a cathedral where someday men and women will come to worship."

Engagement (it's not about you). No matter your business, your product or your industry, focusing on the how and what will limit your engagement. In commodity-driven businesses, the focus on price encourages a transactional mode in which disengagement can happen quickly and easily. Relationships which build engagement and engagement translates into sustainability and longevity, aka loyalty.

Showing your customers, via relevant content and ongoing connection, that you have their best interests in mind, and proving it incessantly through your content and your actions, helps to build loyalty. This is why content marketing and context marketing have exploded. When highly relevant to the audience, nonpromotional content engages without selling and builds credibility and relationships.

Data matters. Creating relevant content is based on knowing your customers' and prospects' interests. However customers and prospects don't always know what they want. Using data to listen to their conversations and observe their behavior is the richest source of discovering what truly matters most. Relevance is also driven by generating very individualized and proactive content using data-driven insights.

In the insurance industry, data can help marketers discern important propensities and upcoming events for business customers. Data-driven insights identify customers at risk for defection, trigger upcoming contract renewal dates and help detect cross- and up-sell opportunities around key business events and predictive propensities. This is b-to-b marketing gold.

Cross- and up-sell directly correlates to years of loyalty. One CMO Council study reveals this trend in the insurance industry: If a customer has bought one or two products, the typical loyalty duration is one to three years. If he's bought three products, that loyalty extends to five years, and four purchases net up to 10 years of loyalty.


In the last decade, b-to-b loyalty programs have been on the rise according to Loyalty 360. Companies like IBM Corp., Microsoft Corp., SAP, Sprint Nextel, Wells Fargo and others have launched loyalty programs for their business customers. Although b-to-b loyalty programs differ in nature to b-to-c loyalty programs, the results can be similarly powerful.

Frederick Reichheld of Bain & Company claims that a 5% increase in retention rate can increase customer lifetime value by as much as 75%. Even if this assertion is off by orders of magnitude, the domino effect of customer loyalty on financial results is still extraordinarily significant. In fact, McKinsey & Company states that loyalty programs can generate as much as 20% of a company's profits.

B-to-b loyalty programs are much more than customer retention programs around renewals, offers and rewards. Smart b-to-b marketers use loyalty programs as a two-way communication vehicle with their highest value customers. Soliciting customer feedback to drive future enhancements, sharing customer challenges and solutions, curating relevant content and providing extra services are a few of the ways that b-to-b loyalty programs can deliver more value to a company's top customers.

Although loyalty is elusive, it is an underleveraged tool in the marketer's toolkit. Knowing your higher-order purpose, devising a relevant content strategy and using data to more closely connect with your customers—via proactive cross-sell, up-sell, retention as well loyalty service rewards, recognition and ongoing conversations—can help grow B2B loyalty.

Sandra Zoratti is an author, speaker and VP-marketing at Ricoh Co. ( You can find Sandra on LinkedIn, Twitter @sandraz and on her website Her email is [email protected]

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