Business Case – Channel Marketing

Distributor Institutes a Loyalty Program that Works!

Target Audience
 5,000 Business to Business (B to B) Customers

Situation
An industrial distributor of telecommunication hardware wanted to create an efficient and rewarding sales process for its B to B customers

Objectives
Create a loyalty program for customers that highlighted benefits of doing business with them.

  • Use the distributor’s Customer Relationship Management (CRM) system to increase sales volume
  • Change customers’ behaviors; transition from phone ordering to online ordering through the CRM system

Solution
The loyalty program awarded customers with electronic ePoints that were deposited into personal online accounts. As ePoints were accumulated, customers could redeem them for high-quality merchandise and other items selected from an exciting online catalog.

The distributor set and communicated a target order goal to its B to B customers. Customers were rewarded as they made progress to their target order goal. Order goals consisted of a combination of volume and targeted product purchases. To drive online ordering, bonus ePoints were rewarded when they made purchases via the distributor’s CRM system.

B to B customers loved the easy-to-use ePoint system and merchandise they earned. They used the ePoints to redeem for:

  • Company-wide perks for their own employees (supplies, equipment, etc.)
  • Individual gifts to reward and recognize their own staff
  • Contributions to charitable organizations

Results CustomerQuote
Sales of key products increased—which resulted in increased volume discounts and price breaks for the distributor.

Increase in online ordering produced a 3% efficiency gain (due to reduced order errors and missed shipments) for the distributor. A 3% efficiency gain meant savings in excess of $250K in the first year.

During a time when the overall market was declining by double digits, the distributor (and the 16 manufacturers who funded the entire loyalty program) saw their businesses grow by 10% + annually.