Friday, May 18, 2007

4 Ways to Build B2B Customer Loyalty and Generate Referrals

As B2B buyers become increasingly immune to traditional marketing and more reliant on word-of-mouth vendor referrals, sellers need to become more sophisticated in building customer loyalty through relationship marketing, and converting this loyalty into referral business. Here are four tactics to enhance loyalty and positive word-of-mouth advertising from your best customers.

Low-Involvement B2B Products and Services

For low-cost products and services, or infrequently-purchased higher cost offerings, one frequently used method is offering discounts. While this tactic can be effective, bear in mind that repeat customers are often less price-sensitive than new ones (which is how cable and phone companies get away with offering super-cheap "switcher" offers while screwing their existing customers -- an exasperating practice for consumers, but apparently successful), so you may be leaving money on the table.

Another tactic is to use a third-party tool such as, which enables companies to build structured programs for soliciting and rewarding referrals from current customers. It provides smaller companies with the tools to build an offering similar to big company customer rewards management systems (e.g. NWA WorldPerks, My Coke Rewards, MaxPerks, Borders Rewards). Janine Popick at hosted email marketing service Vertical Response has some interesting thoughts on reward cards and points programs as well.

High-Involvement B2B Products and Services

For higher-priced products and services, particularly those which involve long-term interaction between the vendor and the buyer (e.g. enterprise software suites, hosted software services, outsourced business services and commercial insurance), more sophisticated tactics are called for.

One intriguing concept is to build your own industry-specific Web 2.0 social tagging site, sort of company-sponsored version of Digg. BeeTooBee enables any company to go beyond offering white paper and podcast downloads to create "a thought leadership community" -- a hosted, private-labeled version of a social news platform that marketers can license to set up user-generated, vote-ranked, and aggregated thought leadership libraries under their brand. The platform includes contact tools such as click-to-chat, so vendors can reach out to prospects when they are ready for interaction. The thought-leadership community turns your employees, existing customers, and even prospects into marketers for your product or service. Interested? You can download the company's no-registration-required white paper here.

Finally, there is the old-fashioned way: build a solid product, back it up with excellent service, maintain relationships, reward your best customers with direct access to key product development people within your organization -- and then ask for referrals. If you are in a position to offer reciprocal referrals to your customers, that's even more powerful.

In the end, the most successful companies won't be those with the biggest promotional budgets, but rather those that have effectively built interactive networks of clients, both online and offline.


The web marketing services site:

The only Twin cities-based marketing and PR agency focused exclusively on B2B IT clients: KC Associates

Contact Tom Pick:


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