How to Elevate Your Channel Loyalty Program to Revitalize Partner Relationships?

Effective channel loyalty programs between a brand and its retailers go much beyond discounts and schemes.

It is a crucial element for transforming relationships between brands and channel partners from transactional to something emotional. Building relationships is of great significance in this competitive market than ever before. There are thousands of brands trying to put better and better offers on the table, and guess what? Your trade partner is going to choose the most profitable one..

So, where does your company stand when it comes to relationships with channel partners? Are your sales strategies only focused on onboarding new retailers/partners or it also accounts for valuing the existing customers?

What is a Channel Loyalty Program?

A channel loyalty program is a structured initiative by a company that incentivizes and rewards its distribution or sales channel partners for their loyalty, support, and sales performance. The goal is to develop and strengthen relationships for long-term association with retailers, dealers, distributors or wholesalers. A well-implemented channel loyalty program utilises incentives, rewards, training, support, and recognition with a focus on motivating and encouraging channel partners to consistently promote and sell the company’s products or services.

Importance of a Channel Loyalty Program

• Building Stronger Relationships: Channel loyalty programs foster stronger and more enduring relationships between companies and their distribution partners. Rewards, incentives, and support create a sense of appreciation and commitment that encourages partners to remain loyal and engaged.

• Enhanced Partner Engagement: Loyalty programs encourage partners to engage more deeply with a company’s offerings. They might invest more time, effort, and resources into understanding and effectively selling your products. Needless to say, this has a direct bearing on better sales, market share, and brand visibility.

• Heightened Brand Advocacy: Whenever a channel partner feels sufficiently motivated, they will become passionate brand advocates for you. This means they are going to talk about your brand and products within their networks and even outside. Word of mouth is an extremely powerful tool, particularly when propagated by those on the frontline of consumer engagement, such as retailers.

• More Communication and Collaboration: Loyalty programs often involve regular communication, training, and support for channel partners. This leads to improved collaboration, knowledge transfer, and a comprehensive understanding of market needs, resulting in more effective sales strategies.

• Competitive Advantage: Today when everyone is venturing into loyalty programs, it comes down to whose benefits the channel partners more. A well-structured and rewarding program will set you apart from the competition – a surefire of acquiring more B2B customers. It demonstrates a commitment to nurturing partnerships and incentivizing performance, making your brand an attractive choice for potential partners.

• Data and Insights: A channel loyalty program provides opportunities to gather data on partner behaviour, preferences, and market trends. This data can be invaluable in refining strategies, tailoring offerings, and making informed business decisions.

Types of Channel Loyalty Programs

• Value-added incentives encompass the rewards or perks extended to channel partners for enhancing existing products within their portfolio. This value augmentation can manifest in various forms, inclusive of additional features, integrations, extended warranties, or any value-adding modifications conducted by the partner. Deploying partner programs rooted in value-added incentives yields a dual advantage for businesses; not only does it amplify the worth of current offerings, but it also significantly elevates brand penetration within the market.

• Channel partner programs often leverage rebates, offering refunds or cashbacks upon partners achieving specific sales benchmarks. These incentives serve as strong motivational tools, prompting partners to intensify their sales efforts by influencing their buyers. Unlike a uniform structure, the rebate percentages vary among partners based on factors like order frequency. This approach not only empowers partners to enjoy the rewards but also enables them to pass on these benefits to their customers, nurturing an all-round advantageous sales environment.

• Incorporating referral incentives into channel partner programs stands as a prevalent and effective strategy. This approach involves incentivizing channel partners to introduce potential partners to the program. These B2B referral initiatives within channel partner programs mirror the referral contests B2C brands often employ to attract more customers, fostering a network expansion through partner recommendations.

• Partnering companies often employ cooperative incentives as a compelling tactic to energise and incentivize their channel partners. These incentives are strategically designed to prompt and reward channel partners for meeting their individual objectives. The utilisation of cooperative incentives involves extending rewards to partners as recognition for their loyalty and consistent purchases. Essentially, any efforts or contributions made by channel partners that significantly contribute to a company’s overarching business objectives are duly acknowledged and incentivized within a cooperative incentives-driven channel partner framework.

Benefits of Running a Successful Channel Loyalty Program

Running a successful Reward Loyalty Program is a vital aspect where you can engage with your trade partners like retailers, partners, or influencers. The main motto of a channel partner loyalty program strategy is to influence the willingness and motivation of your partners to be advocates of your brand. Which generates new opportunities for sales and increases revenue.

More than 37% of retailers confirmed that the opportunity to get rewards from the company is a critical factor in their purchase decision. 

Here’s a list of benefits that an effective loyalty program can introduce:

Increased Partner Engagement: A well-executed channel loyalty program strengthens brand-partner relationships and encourages active engagement. It motivates partners to remain committed and enthusiastic about promoting and selling the brand’s products or services. 

Enhanced Sales Performance: By providing incentives, rewards, or recognition for meeting or surpassing targets, a channel loyalty program motivates channel partners to strive for higher sales figures, leading to increased revenue for the brand.

Better Partner Retention: Partners feel valued when consistently rewarded or acknowledged for their efforts, reducing the chances of them seeking out your competitors.

Market Expansion and Penetration: Loyal channel partners are more likely to actively promote your brand. This word-of-mouth promotion aids in expanding market reach and penetrating new customer segments or regions.

Cost-Efficient Marketing: Loyalty programs often prove to be cost-effective for your brand. Instead of investing a lot in acquiring new partners, retaining existing partners through rewards and recognition can yield greater returns on investment.

Why Do Most Loyalty and Reward Programs Fail?

Your company might be using channel loyalty programs but are they efficient enough? Are these adding value to your company with the major benefits listed in the above sections? If not, then you need to revamp your loyalty program for channel partners. Before diving into the solution, let’s see what are the typical problems B2B customer reward programs face!

Suffer from a low adoption rate
Most of the brands introduce an app for operating customer loyalty programs. In this scenario, each retailer has to be encouraged to install apps. More than valuing the customer, it looks like an added burden to them. Hence, we see a huge dropout in login authentication. Resulting in app uninstallation.

Inflexible Sales purchase validation
The sales purchase authentication is restricted to QR codes or barcodes by many companies. In the case of bulk purchases, barcode scans are a big hassle. Showing purchase proof through limited methods does not consider the situation adversaries that could arise.

Redemption is a nightmare
In general, companies grant points to the retailers as a reward for their loyalty. These credit notes had a less emotional value of gratitude. They give out reward points which are hard to redeem at times. There is a limited catalogue of products for rewards and there are many back and forth movements before retailers can get the reward. In this hassle of redeeming reward points, the partner doesn’t feel rewarded.

Loss of engagement opportunities
With no digital solution for channel loyalty programs, many engagement opportunities are lost. That’s because, when the companies do not convey the benefits of their partnership, the retailers or partners can be easily swayed.

These challenges act as gaps between your attempt to turn your trade into partnerships. Invest in your relationships and you’ll build partnerships that last.

How BeatRoute Manages Loyalty and Rewards for Your Partners?

According to Harvard Business, increasing customer retention rates by 5% increases profits by 25% to 95%. In other words, if a company focuses on making loyal customers, the profitability increases more than what acquiring new customers would bring. In present channel loyalty programs, there are many practical problems that are affecting customer retention as mentioned in the above section.

BeatRoute has a solution for it, this is an integrated loyalty program management system with your SFA and DMS which makes a comprehensive solution for retaining retailers, dealers, and influencers.

Here is how we make a difference

• Reward Point Rules
  While running a reward program, it is essential to have a scheme engine that enables you to set rules based on values you desire. In the FMCG industry, you can set rewards for specific sales performance. Next, you can set up complex rules based on volume and value for rewarding influencers and retailers. As a reward you don’t only get coupons and QR but many vouchers and experience.
• Interface for customers
  Innovative WhatsApp and Viber Bot is a great interface to communicate with your customers. It allows two-way communication with nudges. The user can directly choose the option of loyalty program and view their reward points and know more about how to redeem it. In a nutshell, one need not install any app which increases the adoption rate and boosts the scope of opportunities to engage.
• Ensuring Sales Data Authenticity
  In the industry, it is required to have authentic records of sales. Many companies struggle with the data to ensure that the invoice produced is not forged. Our solution gives versatile methods to authenticate sales of the retailers. Customers can scan a barcode, QR code, serial number or simply upload a bill in case of larger volume purchases.
• Redeem from a Catalog of Global Items and Experience
  For customers to feel rewarded, companies need to give worthy gifts. Here, we have a global catalogue of physical gifts and experience listed within BeatRoute. We have integrated with the reward engine, Xoxoday Plum Store which supports hundreds of voucher options in more than 50 countries. The reward recipient can avail vouchers of Amazon, Flipkart, known din-out, dominos, etc. It offers an excellent reward point system that intelligently includes different emotional components of the customers to reward them rightfully with no hassle in redeeming. Through this solution, the user gets redemption details on completing the target. Hence, redemption of rewards is no more a nightmare.

Conclusion

Channel loyalty, as already stressed, is capable of forming and sustaining long-standing relationships between brands and channel partners. Loyalty management helps you to better engage with your partners, retailers, influencers, or distributors towards this to successfully achieve your goals. It is better if there are some customised incentive programs that reward them for repeat sales from the same brand. As you know, presently there are a number of issues while trying to retain customers. That’s why, to get ahead, you need an innovative and adaptable solution for better chances of gaining loyal customers. If you have a business need for loyalty management programs that will not disappoint you, you can book your demo.