Mar 17, 2022

B2C retailers are always thinking about loyalty. There’s a good reason for this. So, how can B2B commerce businesses build greater customer loyalty and increase the lifetime value of their B2B buyers?

According to research by Frederick Reichheld of Bain & Company, increasing customer retention rates by just 5% increases profits by 25% to 95%.

Now, consider the far greater potential lifetime value of a B2B customer and it’s clear that a lot of money is being left on the table by B2B businesses by not prioritizing customer loyalty. In fact, a white paper by the CMO Council found that 77% of B2B marketers know they are not realizing the full revenue potential of their existing customers.

How Is B2B Customer Loyalty Different to B2C?

With B2B and B2C buying practices increasingly crossing over, it would be easy to presume that customer loyalty strategies are the same for both. But, as you can see below, there are a lot of differences between B2B and B2C purchases.

B2C Purchases

Single decision-maker (the customer)
One-off sales
Often spontaneous
A mix of wants and needs
Standardized pricing within a single retailer/brand (including discounts/sales)
Fast transactions

B2B Purchases

Typically involve multiple decision makers
Higher volume orders
Often recurring or require regular replenishment
Needs-driven
Negotiable/contract pricing including need for quotes
Slower transactions that may involve multiple points of contact

It’s clear from the above that the buying journeys of B2B and B2C customers will be very different. This affects how customer loyalty is built. Specifically, B2B commerce businesses need to position themselves as a partner rather than just a seller.

Buyers will be more loyal to businesses that they believe can help them achieve their end goals. Yes, B2B customers want to buy good quality products and services, but they want them because of the value they deliver. They’re looking to work with B2B businesses that recognize their aims and want to help buyers achieve them. This idea is so powerful that we’re increasingly seeing B2C brands adopt it as part of their loyalty efforts.

B2B commerce businesses need to position themselves as a partner rather than just a seller.

What B2B Businesses Get Wrong about Customer Loyalty

When B2B commerce businesses start to think about customer loyalty they often overlook three key things.

Thinking Emotion Doesn’t Affect B2B Buying Decisions

It’s easy for businesses to fall into the trap of thinking that decisions about B2B purchases are entirely emotion-free.

We can understand how emotions may play a role in what we buy as consumers, but when it comes to B2B we wrongly assume it is all about logic and the bottom line. Those things are hugely important, but B2B buyers also consider how they feel about a B2B business and their experience when making buying decisions.

Almost 60 percent of B2B customers reported they had never had an experience with a brand that made them feel special.

However, in a PwC survey, almost 60 percent of B2B customers reported they had never had an experience with a brand that made them feel special. Gallup also found that 68% of B2B customers are lost because of indifference or perceived apathy, not because of mistakes.

By making customers feel valued, B2B commerce businesses can increase loyalty. One way to do this is to bring new, relevant ideas to your B2B clients that show you’re thinking about their business goals and how to make them happen.

Not Investing in Brand Building

B2B businesses tend to think of brand building as a necessity of B2C, but it’s actually just as important in B2B buying. This is because company reputation and customer trust have a huge influence on who B2B clients do business with. This is why they tend to gravitate towards well-known, familiar names.

In fact, 70% of B2B buyers cite company reputation as the most influential factor when choosing which company to do business with according to LoSasso.

What’s more, customers don’t necessarily trust the claims of brands themselves. Hubspot found that 81% of customers trust recommendations from family and friends over those from companies.

This shows the importance of word of mouth and building up your B2B commerce brand. The more that you can do to position your business as an expert through your product offerings, content and delivering on your promises, the more loyal your B2B buyers will be – and the more they will tell others about you.

Overly Focusing on New Client Acquisition

The Pareto Principle (also known as the 80:20 Rule) states that 20% of your customers are responsible for 80% of your revenue. Yet, businesses put more effort into acquiring new customers than they do taking care of the ones they already have.

This not only overlooks the value within their existing client base but is also more expensive. Studies show that it costs at least five times as much to acquire a new customer than it does to keep one.

What’s more, businesses have a 60-70% chance of selling to an existing customer but only a 5-20% chance to selling to a new prospect, according to the book Marketing Metrics.

So, it not only costs more to attract new customers, but there is also a far lower chance that they will actually buy something.

Get Started Building B2B Customer Loyalty

It’s a compelling case for B2B commerce businesses to switch their focus to retaining customers through loyalty.

But how do you do that?

These four steps represent a good starting point:

Understand your B2B customer: Who are the different stakeholders in the buying organization? What do they care about? And what actions do you want them to take?
Consider a B2B customer loyalty scheme: What type of incentives would benefit your customer’s business?
Make the most of digital in B2B buying journeys: Streamline the buying journey and remove friction by leveraging digital tools in every step.
Provide a great B2B customer experience: The better the customer experience that you can offer, the stronger your relationship will be with your B2B clients.

Learn more B2B customer loyalty best practices by downloading our checklist 4 Steps to Building B2B Customer Loyalty.

Checklist

4 Steps to building B2B Customer Loyalty

The most successful B2B commerce businesses are making B2B customer loyalty a top priority. They recognize that it’s harder to leave a business you consider a partner than one that just sells you things.