Achieving channel leadership through B2B digital loyalty programs

Digital loyalty programs are an emerging tool for B2B brand marketers hoping to increase end-user repeat purchase rates. Pull strategies like this are typical in consumer markets, but in supply chains, push tactics are more usually deployed to promote brands against rivals and manage channel relationships. Advances in data science have made B2B user loyalty programs viable for manufacturers; their benefits include data transparency and hence greater channel power to leverage downstream, upstream partnerships or both. Nevertheless, their digital transformation potential in industrial relationship marketing is not yet well understood. The purpose of this study was thus a) to identify perceived barriers to adoption and b) to evaluate the potential and scope for channel leadership offered by the tool. Senior channel-marketing professionals working for national and international brands gave semi-structured in-depth interviews. From content analysis, similarities and differences in managerial experience were categorised across Industrial, Fashion and CPG markets and from different channel partner perspectives. We find that adopting loyalty programs within supply chains is unlikely to become universal. In CPG and Fashion, where costly pull investments drive consumer demand, digital loyalty programs offer only a slight advantage while adding incremental costs. However, the schemes would be effective in industrial goods categories, where they would increase the channel power of manufacturers in several ways. The implications of these findings for industrial marketing theory and practice are discussed, and a program of future descriptive research is set out.