Why Luxury Brands Need Loyalty - More Than Ever!
30th June 2022
Written by Tom Peace
In a post-pandemic world and with the cost of living rising, luxury brands need to focus on what can set them apart from competitors and add extra value for customers who are tightening their purse strings.
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In a post-pandemic world and with the cost of living rising, luxury brands need to focus on what can set them apart from competitors and add extra value for customers who are tightening their purse strings.
Historically, many luxury brands fear what a loyalty program may do to their brand image. But now is the time for the luxury industry to open up its eyes to the huge benefits a loyalty program can bring, such as access to valuable consumer data and trends, increase spending and new customer acquisition. According to Branding Strategy Insider, luxury fashion loyalty programs can increase the number of high-spenders from 10% to 15-20%.
Check out some loyalty program tips, specifically for the luxury industry:
1. Know your options
Do your research or contact an expert! Whilst many luxury brands go for a tiered approach rather than a points-based loyalty program, it might not be the best fit for your brand. If points-based loyalty is the chosen strategy, think about rewarding a smaller amount of points that are worth more. Luxury brand shoppers prefer rarity.
2. Get creative
Come up with a creative name that's in line with your overall brand. Harrod's Rewards, Hugo Boss Experience and The Curator by MatchesFashion are great examples.
3. Add value with exclusivity
Reward your VIPs with exclusive privileges and perks such as access to products first, invites to exclusive events or a birthday gift. Adding extra value can help increase customer loyalty. A recent study showed that 40% of consumers would remain loyal to brands that provided extra value other than product/price (a huge 67% YoY increase)
