Principia says manufacturers and dealers both can benefit if they structure the programs right
Manufacturer and dealer programs that reward contractors for loyalty generate a greater amount of business provided they become the customer’s first choice, new research by Principia Consulting suggests.
A Principia survey of more than 1,100 contractors found that if the customer was in just one manufacturer loyalty program involving a product category, that program’s brand was likely to get 62% of the contractor’s total spend in that category. In addition, Principia says a manufacturer’s share of the customer’s wallet grows faster than if the enrollee weren’t in the program—and that enrollees’ revenues grew faster than their peers. The survey was conducted in October, with first results reported in January.
But in general, loyalty programs still have a lot of potential customers to win over. Of the 1,100 contractors Principia surveyed, only 42% of the pros specializing in windowsand doors said they were in loyalty programs offered by dealers. The share ranged upward to 47% for the trim and molding category, 48% for roofing, 49% for decking, and 58% for siding, so only one of the five categories had participation topping half.
The penetration of loyalty programs offered directly by manufacturers also was low. Again, of the 1,100 contractors Principia surveyed, only 46% of the pros specializing in windows and doors said they were in manufacturer loyalty programs. The share ranged from 45% for the roofing category category, 56% for trim and molding, 61% for decking, to 70% for siding.