Long gone are the days where loyalty programs depicted simple factors like points and rewards. Businesses currently rely on channel partner and last mile advocate loyalty to drive their business growth and drive better sales too.
Tracking the right metrics is crucial to keeping your channel partners engaged and your business thriving. To ensure a smooth journey, it is vital that you have access to all the relevant data to not only make the most out of the loyalty management tools but also maximise the returns from these loyalty programs.
Consider your loyalty program as a high-performance engine. These seven metrics are your dashboard, telling you exactly how it’s running.
1. Participation Rate: Are They Even Playing the Game?
The main purpose of your channel partner loyalty program is the participation rate. Can you imagine throwing a huge party but no one attending it? That’s exactly the scenario that happens when you run a loyalty program that has nominal to no participation rate.
Are your channel partners signing up? Are they logging in? Are they redeeming the rewards they are winning?
Let's say you have 500 channel partners, but only 200 are participating in the loyalty program. That's a 40% participation rate. Not terrible, but definitely room for improvement. If you see such stark differences, chances are that the loyalty program isn’t appealing enough.
Perhaps the communication is lacking. Or maybe it's just too complicated. A low participation rate is a red flag, urging you to investigate and make adjustments.
2. Active Engagement: Beyond Signing Up – Are They Engaged?
Participating via a good loyalty management system is the first step. So, they signed up. Great! What next? The next step in the process is active engagement. This particular metric measures how frequently your channel partners are interacting with the program.
Are they earning points? Redeeming rewards? Participating in contests? A high participation rate with low engagement is like having a lot of gym members who never set foot inside.
An example of active engagement would be tracking how the individual channel partners are participating in the activities. If there are elements like rewards upon completion of sales or training completion, you need to track which aspects are receiving more engagement.
If the channel partners are earning points mostly for their sales, you need to promote the other engagement opportunities of the loyalty program management software.
3. Redemption Rate: Are They Cashing in on the Rewards?
Another critical metric that depicts the success rate of your channel partner loyalty program is the redemption rate. After all, what is the point of earning the points if you can’t use them?
The main reason of a low redemption rate is that the rewards that you are offering to your channel partners and last mile advocates aren’t enticing enough. Not just the rewards, there are a few other aspects like the redemption process is too difficult or that the partners aren’t even aware of the loyalty programs.
This metric tells you what percentage of earned points are being redeemed. A low redemption rate can lead to partner frustration and disengagement. They might start to feel like the program is more trouble than it's worth.
4. Partner Lifetime Value (PLTV): The Long Game
This is the big one. PLTV estimates the total revenue you can expect from a partner over the course of your relationship. More than the current sales, it also highlights the potential future contributions.
When you are leveraging the right loyalty management tools, it will significantly impact the PLTV by ensuring better partner retention and driving repeat business too.
Here’s an example to better explain why PLTV is so necessary to track when you have a loyalty program for your channel partner and last mile advocates.
Let’s say you have two channel partners – Partner A and B.
Partner A generates 1 cr. in revenue every year and has been with your business for 5 years now. Partner B, on the other hand, generates around 10 cr. in revenue every year and has been with you for 2 years now. On the surface, Partner B seems more valuable. But if Partner A has a higher PLTV due to their long-term loyalty, they might be the more strategic investment.
5. Program ROI: Is It Worth the Investment?
If your loyalty program isn’t yielding the desired return on investment, is it worth it in the end?
Measuring the loyalty program ROI is a metric that more specifically measures the profitability of the program by comparing the costs (program administration, rewards, technology) to the benefits (increased sales, improved partner retention).
Calculating the ROI can be a pretty tricky and confusing affair. However, if you take into consideration all the individual factors we have mentioned, it is fairly easy for you to measure if the investment on a loyalty program management system is worth for your business in the long run or not.
6. Partner Churn Rate: Are They Jumping Ship?
In the business world, there is a saying that “Retaining is cheaper than acquiring.” The same applies to your channel partners too.
Losing your channel partners, especially the trusted and loyal ones that have been with your business for a long time can be an expensive affair. After all, it takes a good amount of time to recruit new partners and train them.
The partner churn rate measures the percentage of partners who leave your program or stop actively engaging. A high churn rate is a major warning sign.
It indicates that something is wrong, either with the program itself or with your overall partner relationships.
7. Partner Satisfaction: The Happiness Factor
Besides your customers, your channel partners and influencers are your biggest brand advocates. While standard data and metrics play a crucial role, they don’t necessarily tell the whole story.
This is where you need to measure the partner satisfaction rate. How happy and satisfied are your channel partners with the loyalty program you have deployed? You can leverage surveys, feedback forms, and one-on-one conversations to assess that.
Happy partners are more likely to be engaged, loyal, and productive. They're also more likely to recommend your program to other potential partners, so that’s something you need to keep an eye (and ear) out for.
Tracking for Success: 1Channel Loyalty Management
With the right loyalty management tools like 1Channel, it is fairly easier for you to track how well your channel partners are reacting to the loyalty program. The data allows businesses to measure what’s working, what’s not working and what tweaks your channel loyalty programs need.
1Channel’s loyalty management software is a comprehensive solution that prioritises transparent display and tracking of metrics and analytics.
If you are ready to track smarter, reward better, and grow faster, schedule your free demo today!
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