How do you judge the success of a business? Sure it would be about yearly growth and expansion plans. Similarly, there are some ways and KPIs to measure channel partner loyalty program success. It would be inappropriate to just run loyalty programs without measuring their success rates. Without further ado, let’s begin.
How Crucial Is It To Measure Loyalty Program Success?
Honestly, the cost of running a loyalty program is too much for a company operating across the country. For companies, it becomes critical to know where their funds are going and who is filing for rewards. Here is why measuring loyalty programs is crucial for distribution-led companies –
- To Achieve Loyalty Program Goals – Whether your goal is to expand channel partners, decrease churn, or increase channel partners, monitoring progress is crucial to determine how close are you to achieving these goals.
- To Identify Areas of Improvement – Loyalty programs alone cannot guarantee success. Companies must evaluate how channel partners respond to the program and identify areas for improvement.
- To Get a Better Understanding Of Channel Partners – By running loyalty programs, companies get to understand their channel partners – their preferences, performance, and other performance factors. With this knowledge, companies can customize their programs to meet the channel partners’ demands.
- Evaluate Effectiveness of Rewards – Analyzing loyalty program metrics can help determine whether your incentives and rewards motivate your channel partners to participate in the schemes.
Measure Success of Channel Partner Loyalty Programs With These KPIs
The following metrics can be the foundation while evaluating the effectiveness of channel partner loyalty programs –
- Redemption Rate – It refers to the percentage of rewards that channel partners use to redeem. A high redemption rate indicates that the rewards are valuable and relevant to channel partners and vice versa.
- Profitability Per Redemption – It measures the profitability of channel rewards. You can calculate it by dividing the total profit generated from redeemed rewards by the number of redemptions requested by channel partners. A low profitability per redemption means that the rewards are too expensive or they’re not generating enough revenue to justify the cost incurred in loyalty programs.
- Partner Lifetime Value – Partner lifetime value considers the additional revenue generated by their participation. It shows the long-term value of retaining partners through loyalty programs.
- Repeat Purchase Rate – It measures the percentage of channel partners who make a repeat purchase. A high repeat purchase rate is positively correlated with loyalty programs. It shows that channel partners are satisfied with the products and are more likely to continue to engage with the schemes.
- Engagement Rate – The engagement rate measures how actively and frequently channel partners engage with loyalty programs. A higher engagement rate tells that channel partners are interested in the program and the program is helping them to increase their business as well.
- Net Promoter Score – Net promoter score indicates partner satisfaction with the schemes. As a company, you can ask loyalty members how likely they are to recommend your brand to others on a scale of 0 to 10. The higher the ratings, more is the satisfaction among loyalty members.
- Churn Rate – It shows the percentage of channel partners who have stopped engaging with the program within a specific period. The churn rate indicates the underlying program with the overall loyalty program.
How O4S Helps You Ace The Game Of Channel Partner Loyalty Program?
Physical coupons and paper-based loyalty programs have a limit beyond which companies are unable to track KPIs and channel partner performance. For this reason, companies should opt for a sleek digital ecosystem that will enable them to track the success of their channel partner loyalty programs.
O4S provides a solution for distribution-led companies that want to track individual channel partner performance and the success of their multiple loyalty programs. The solution enables businesses to –
- Offer Personalized Rewards – By studying demographics, partner preferences, and purchase behaviour, companies can learn a lot about their channel partners – tastes and preferences towards rewards. O4S allows companies to design customized rewards that boost channel loyalty and participation.
- Targeted Marketing Campaigns – With the help of a content management system and analytical dashboard, create impactful schemes for your channel partners. By focusing your marketing efforts on partners who share common traits, you can tailor your message to gather engagement and participation.
- Use Media to Connect With Your Partners – Incorporating SMS and WhatsApp into your loyalty programs can be a powerful tool for improving your KPIs. Sending in-person emails in text messages is more effective than sending generic emails about loyalty programs.
- Gamify The Process – The environment powered by O4S makes selling fun for channel partners. When selling every unit becomes a small milestone to achieve, it evokes a sense of competition among channel partners which benefits the overall loyalty scheme.
- Prompt Guidance – Building a digital channel partner loyalty program and setting up its KPIs is easier said than done. Embedding digital channel partner loyalty within an existing framework is a mix of technical, operational, and analytical challenges. Our team is available round the clock to help distribution-led businesses overcome these challenges and run impactful channel loyalty programs.
Summing Up
Running a channel loyalty program is only half the battle. Companies also need to measure the success of their loyalty programs, and that’s how everything balances out. The above KPIs will help you to measure the success of your loyalty program and keep your channel partners encouraged to engage with your brand.
