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Editorial

Customer Loyalty in the Experience Economy — the CMO's Perspective

5 minute read
Ian Truscott avatar
By
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Why B2B marketers need to prioritize customer loyalty and retention alongside new business to sustain revenue growth in a SaaS-driven market.

The Gist

  • After sale blind spot. Focusing only on acquisition ignores the shifting reality of shorter renewals and lower switching friction in B2B tech.

  • Brand loyalty loop. Strong brands create forgiving, loyal customers by connecting experience and perception across the entire customer journey.

  • Retention is everyone's job. Marketers must engage not just executives but also daily users who can drive advocacy or churn from the inside.

The typical pressure on a CMO is to focus on the new. I talk about the goal of marketing to create ART (Awareness, Revenue and Trust), and we tend to get measured on creating awareness and trust with a new audience; the commercial focus is on lead generation for new business and growth. 

All the dials need to point up and to the right. 

In B2B technology, the category I play in, this was fine when technology was sold on perpetual license. There was a great deal of friction to change, and “churn” was a three- to four-year process. Our sales and marketing organizations were built around this customer experience. There was a clear buying phase, then a clear service stage, then a clear renewal phase. 

Of course the successful companies didn't just pitch up at renewal time with their sales team and customer marketing (although some did!). But today, most software is SaaS or at least hosted and financed in that way.

Those days are over.

Table of Contents

Customer Marketing: A Key Driver of Customer Loyalty and Retention

Being disconnected from the customer post sale has a significant commercial effect now. Switching friction is significantly reduced, and “renewal time” is now annually, quarterly or even monthly as budgets and tools are regularly scrutinized.

If you continue to only focus on new business and neglect existing customers, the pressure actually builds at the new business sharp end as it raises the bar on the target for new business growth.

There is a greater demand internally for demand, as we need to widen the funnel to replace the revenue that has been lost to customer churn.

This is especially tricky in competitive markets in “demand-neutral” categories, where there is simply not the demand in the marketplace to support a high churn business. For these businesses the opportunities are in cross-sell and up-sell driving net dollar retention (NDR) growth and to earn a greater slice of the client's budget (or share of wallet, as our B2C colleagues would describe it). 

Forrester refers to this motion as “customer obsession” and reported that customer-obsessed B2B companies are twice as likely as their non-customer-obsessed counterparts to report year-over-year revenue and profitability growth of 10% or more, according to its State Of Customer Obsession Survey, 2023.

The Role of Brand in Customer Loyalty

I have been thinking a lot about the long and short of it in marketing, a term coined by Les Binet and Peter Field. We tend to be driven to think short term in our data-led digital marketing obsession, but we need to invest in long term marketing motions. And it’s no different when we think about customer marketing. 

The brand is a marketing multiplier. The results of everything we do improves when you have a recognized brand, and it’s no different when we focus on customer loyalty, as customers are more forgiving if they feel engaged with the brand. 

How Brand Experience Creates a Customer Loyalty Flywheel

Then, there is a flywheel effect when it comes to brand and customer experience. A great customer experience fuels a positive perception of the brand. The consumer is more engaged and forgiving, the customer experience is perceived more favorably and customers are more likely to share their positive experience of a product if aligning with that brand makes them look good. 

Similarly, if it does go wrong, you’ve created a community of folks, or tribe of advocates, who will rise to your defense. 

Which all of course fuels an increased brand perception and value, which in turn improves customer loyalty, customer retention and customer acquisition. 

So, it’s imperative that we spread our marketing love and budget across the entire buyer's journey, beyond purchase and into onboarding, advocacy and renewal and upsell. We need to structure our team, processes and goals to include customer marketing and keep our customer in the tribe.

5 B2B Marketing Tips to Improve Customer Loyalty

Bear in mind: people love change, but not when it happens to them, so you just need them to do nothing, not change and stick with you. And there are some things that marketing can do to support custom loyalty:

TipDescription
Agree the metrics and goalsEnsure that this customer focus and the motivation for this is shared with the rest of the leadership team and align marketing’s goals to metrics like Net Revenue Retention (NRR), Customer Lifetime Value (CLTV) and Expansion Revenue and not just pipeline creation.
First impressions countMap your messaging, content and communications across the entire customer journey, not just the buyer's journey, and follow them through to advocacy and focus, specifically on the onboarding process. How do we support our personas immediately post purchase?
Manage the brand gapThere are two brands: the one you develop, nurture and communicate; and there is the perception the market has of you. It’s important to understand your reputation and how to narrow the gap between the brand promise and what is delivered.
Nurture and personalizeWe put a lot of focus on understanding the pre-purchase, developing sophisticated email nurture sequences and personalized offerings and yet send our customers the occasional generic functional newsletter from the customer service team. How do these communications incentivize them to deepen their relationship?
Formalize customer advocacy programsConsider the needs of your personas outside using your product or service; they want to have great careers, be seen as a thought leader or wherever it is. Consider how you can incentivize reviews, referrals, case studies and offer peer speaking opportunities, introductions to analysts or other industry luminaries.

Bonus Tip: Don’t Forget the Users

The most likely scenario that sees an organization make a B2B solution provider change is when the users get unhappy. Then, someone becomes the champion of the disaffected users, seeks to be an agent of change and becomes an internal sponsor for a competitive product or service.

It’s therefore imperative that your messaging, advocacy programs and incentives are not just for the executives. You need to consider personas that may have been bit players in the buying journey, but are very much key to retention and upsell. 

Learning Opportunities

For example in B2B tech we see a lot of value in MVP (Most Valuable Person) programs that reward folks that are active in the community, advocate for the product or service and are incentivized by their reputation in the community as well as recognition and attending exclusive events, retreats or offered speaker slots. 

Create ART for All

So, to conclude we still need to create Awareness, Revenue and Trust, but we need to shift our focus from the new to how do we deepen our connections to people that are already aware of us and have trusted us, protect future revenue and grow our slice of the budget.

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About the Author
Ian Truscott

Ian is a tea-drinking B2B technology marketing chap, 3xCMO and independent marketing strategist at Rockstar CMO, where he applies his mantra of creating ART (Awareness, Revenue & Trust) for a portfolio of B2B clients. Aside from being a columnist here since 2009, Ian also shares his expertise on the Rockstar CMO podcast and his regular Tuesday 2¢ blog. Connect with Ian Truscott:

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