Did you know that the cement industry contributes 5.4 percent to global GDP and 7.7 percent to global employment? Globally, it’s one of the most important industries, and it plays a direct role in the infrastructure and economic development of all countries in the world.
Without cement, there would be no roads, buildings, or bridges, and infrastructure development would come to a standstill. That’s why more cement manufacturers must enter the rapidly-growing sunshine industry and cater to the rising demand.
What’s even more interesting is that the sector has a long and diversified supply chain. That’s why it’s also important for cement manufacturers to build strong relationships with their channel partners and influencers.
However, customer retention is becoming a challenge for many big and small cement manufacturers due to various reasons, such as lower margins and rising costs.
How to Create a Cement Industry Loyalty Program That Works
This blog post discusses how loyalty programs can benefit cement manufacturers of various sizes and types and help them retain customers, channel partners, and influencers for a long time.
Here are seven things to do while creating a cement industry loyalty program:
1. Leveling of the Playing Field
The cement industry (both global and Indian) is a highly consolidated sector. To put things in perspective, the top cement company in India accounts for almost a third of the total market share. That means the rest of the players in the industry have to contend for the remaining two-thirds of the market share.
This can be a huge deterrent for small-size cement companies and new entrants trying to compete with the big players. But loyalty programs can level the playing field for new and small cement manufacturers. By leveraging sophisticated loyalty programs, all types of cement makers can foray into new markets, onboard more channel partners, and increase their market size.
2. Diversifying of Customer Base
At present, a majority of cement manufacturers cater to just a handful of customer bases. As per a study, the private construction sector is the biggest customer in the cement industry, which accounts for more than 50 percent of demand. The government infrastructure sector is the second largest customer, which contributes over 40 percent of the demand. That’s like putting all your eggs in one basket!
Diversifying the customer base not only minimizes risks but also presents cement manufacturers with more prospects for growth. Loyalty programs can help with that. Apart from supplying cement to institutional customers, cement companies can also leverage advanced loyalty programs to attract and retain individual customers.
3. Cost Efficiency and Competitive Advantage
At present, many cement manufacturers are grappling with lowering margins due to rising costs. Advertising and marketing costs account for a majority of the expenditure and many companies don’t have the mechanisms to calculate their return on advertising and marketing investments. But like in all other sectors, the cost of attracting a new customer is considerably more compared to the cost of retaining an existing one.
Suggest Read: 7 Ways Channel Loyalty Programs Can Help Cement Industry Grow
Loyalty programs not only enable cement manufacturers to retain existing customers and channel partners but also provide them with several tools to measure their ROI.
Furthermore, the established players use multi-prong strategies to attract new customers and channel partners and retain them for a long time. Loyalty programs can give a massive competitive advantage to new and upcoming players in competing with their bigger counterparts in the industry.
4. Reduce Customer Churn
Customer attrition is one of the biggest challenges that many cement manufacturers face. As per a report, the global cement industry registers a 15–25 percent churn rate. As per industry standards, a customer attrition rate of more than 20 percent is considered high.
Loyalty programs can help cement manufacturers reduce customer churn rates. By coming up with different customer retention strategies, cement manufacturers can engage their customers, channel partners, and influencers and reduce the churn rate to a large extent.
5. Prevent Loyalty Fraud
Cement manufacturers that rely on traditional loyalty programs often struggle to ensure complete transparency. Pilferages and frauds are two big problems in traditional loyalty programs and they cause huge discontentment among channel partners and customers in the cement industry.
By leveraging sophisticated features, loyalty programs can prevent loyalty fraud in the cement industry. For instance, at LoyaltyXpert, our dual wallet is a specially-designed feature to prevent loyalty fraud. Likewise, many other features, such as location-based reports while scanning, a point verification system, a KYC update to prevent duplicity, and a one-time QR Code scan can also eliminate loyalty fraud.
6. Facilitate Regular Communication with Channel Partners
Channel partners are extremely crucial in the cement industry. When cement manufacturers manage to retain their channel partners for a long time, they are more likely to tap into their strong network and make their products widely available in different markets.
Loyalty programs can facilitate regular communication between cement manufacturers and channel partners as well as influencers. By doing so, they can build long-lasting relationships with their business partners.
7. Receive Frequent Feedback
By using loyalty programs, cement manufacturers can receive frequent feedback from their channel partners and influencers. This will keep the feedback loop open and it’ll enable cement manufacturers to know where they are doing right and where they need to improve. Besides, the sophisticated real-time analytics and reporting tools will help cement companies monitor their KPIs (Key Performance Indicators) and pivot at critical junctures.
Suggest Read: Create Customized Loyalty Program for Cement Industry
Taking everything into consideration
Loyalty programs for the cement industry are extremely important to build long-term relationships with customers, channel partners, and influencers. If you’re a cement maker, then you must focus on onboarding the right channel partners strategically and retaining them for a long time.
At LoyaltyXpert, we have a proven track record of designing and creating highly effective loyalty programs for all sizes and types of businesses across industries. To know more about our loyalty platform and request a free demo, contact our team of loyalty experts today.
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