How to Measure Customer Loyalty?

It could be ironic that an emotion, loyalty, play a major role in the performance of a business, which is strictly approached from numeric aspects today. There are hundreds of platforms out there to calculate the many monetary aspects within the business. Then, we have rewarding systems to celebrate the outcomes derived from these platforms. However, measuring customer loyalty, a notion majorly connected to emotions, or intentions, may seem a bit ambiguous. The question of how to measure customer loyalty became a necessity for the commerce sector, where the ecosystem is far more crowded than any business. And there’s no need to say what they call “customer” is a bit more diverse too.

To complicate things even more, B2B, all along with its actors, forms a domain where generic definitions of loyalty do not always apply. Because it is not simply that the numbers of partners are increasing as you grow as a B2B brand. When you adopt a new partner, you together mold a new channel that involves the subchannels of your partner. This altogether implies an interconnected system that can and should operate on various factors – both tangible and intangible.

In long-lasting and strong channel relationships, these factors usually cater to values that are far beyond merely mutual benefits or material gains. The feeling of loyalty, as stated about, becomes a must-have. Various channel management software are there to shift the whole operation to a digital and seamless level. Then B2B loyalty programs are integrated into the new platform. However, it cannot start without defining the loyalty notion in your own brand language, otherwise, the structure will not fit.

Embodying “Loyalty” Through Loyalty Behavior

Before you start a channel loyalty program, it is beneficial to measure the channel status quo. Firstly, pay attention to customers who demonstrate loyalty behavior. Tracking and monitoring them, then distilling this data into meaningful information is the foundation of a future loyalty strategy. You can then assign particular actions to these pieces of information, and eventually build up a whole pattern. The main concern here is that it is sometimes hard to integrate a template for achieving this.

For B2C, the performance is strictly linked to more direct results. Is the particular customer coming back? Are they referring us to their inner circle?

But for B2B,  it takes time to build up a network of trust. You should expect growth exponentially through channels, and subchannels.

For this, many B2B brands adopt B2B loyalty programs for handling the customer loyalty department. B2b loyalty has many variants, that are partly effective in the offline world as well, and only a next-gen platform that covers these very aspects can handle it.

How to Measure Customer Loyalty in an Abstract Context?

Measurement is the first step in customer loyalty management.

For a B2C, it could be repurchasing levels, multiple product purchases, whether they refer you to their friends and family. In short, how much they are willing to come back. A degree of retention is necessary to be able to talk about customer loyalty. And monitoring these behaviors in question at regular intervals will work.

To measure customer loyalty, B2C brands usually track customers on the basis of the following, that we can call as part of their customer loyalty index:

  • Customer lifetime value
  • Repeat purchase rate
  • Net promoter score

As you can see, all of these metrics are exclusively about and aimed at retention. For B2C, this makes perfect sense for the customer-brand relationship.

For B2B, though, as we emphasized several times in various context, requires a broader view. Therefore common B2C concepts being compared like customer retention vs customer loyalty does not apply in B2B the same way it would in B2C. It does not work in a similarly mechanical sense, nor has a formula.

For businesses operating in the retail sector, for instance, there is another side to the business than B2C relationships. Backstage transactions in B2B take place on the wholesale level, which brings us to channel relationships. As we mentioned above, this expands the emotional element all across the loyalty strategy, and a next-gen platform covering all, like Apex Loyalty, is capable of addressing such.

Determining the Metrics for Customer Loyalty

All that being said, how can we spot the metrics that would both fit in this complex B2B landscape, while yielding results that would reflect positively on sales?

Apex Loyalty offers the following features to address the many variants: Personalized Community Platform, On-Site Engagement Utilities, Tailored Segmentation, and Campaign Management points, Marketing Automation Tools, Rewards Built-In.

As flexible and open to custom-made touches, the standardization it offers enables tracking customer loyalty over time.

For this, Apex Loyalty deploys the below metrics:

  • Enrollment Rate
  • Redemption rate
  • Active Engagement Rate
  • Point Accumulation Rate
  • Content Consumption Rate

Find further information about them and how they contribute to your customer loyalty success, here in our post B2B Engagement Metrics.

Enabling benchmarking through effective scaling, and helping you spot the weaknesses in your B2B loyalty strategy, Apex Loyalty will contribute tremendously in reshaping your future plans.


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