8 tips for luxury fashion loyalty programs

A luxury fashion loyalty program is a customer acquisition and retention strategy. It’s about hooking customers into a long-term reward plan. The goal is to position it so that they can continue to shop to reap the benefits of the plan.

These benefits are reasonable and considered attractive mainly because luxury brands do not offer discounts. However, they invite high spenders to exclusive events and parties that they organize. There are also instances where they invite this small portion of customers to their product launches and give freebies like small earrings or perfume.

But since the pandemic, social gatherings have been limited. Thus, loyalty programs that only offer such benefits must adapt. Especially for a brand that competes in the fashion industry. You need to know how to woo your customers and keep them up to date with your clothes and jewelry without them seeing it firsthand.

But how can you do this?

1. Introduce exclusivity

Luxury fashion brands can be expressed in one word: exclusivity. If your products cost a hundred times more than the average, you must offer exclusivity to your customers.

For example, release a rare watch or a limited edition genuine diamond earring that only has 20 pieces worldwide. You can also team up with high-profile personalities to create a limited-time collaboration.

This makes the items rare and would make them relatively affordable considering how many you own. Doing this will make the product an investment since its scarcity will only increase the price in the future.

You can offer the loyalty program to your customers via invitations to grab the limited edition products before anyone else. But you have to be careful though. If you have a large customer base, you may have to go to the biggest spenders or sacrifice exclusivity to include them all. This negates the point of being a luxury brand.

Although a very top-down approach, this strategy has delivered results for many brands.

2. Introduce membership levels

Age-old reward-per-purchase programs don’t work as well for luxury fashion brands as they do for mid-markets. Luxury customers are not as motivated by shopping rewards as others due to the infrequent purchase cycle of products.

Separate memberships into tiers

People consider status and levels in almost everything. Even within subscriptions, you can have tiers for people who want to pay more for additional benefits.

  • A tier two membership may offer products such as salon and spa coupons, coffee discounts, and more. This could be the top 10% of your customers.
  • Tier 1 Membership can offer jewelry discounts to the top 5% customers.

This tactic allows your luxury brand to create a connection with your valuable customers. They would also be eager to be promoted to a higher level because of these benefits. Besides, no one likes gifts more than the rich.

3. Surprise your customers

Luxury fashion brands focus on building a relationship with every customer. They make up for their lack of market share with their prices. As a luxury fashion brand, you have to satisfy every customer and surprise them from time to time to keep them updated.

Surprising your customers can include privileged access to exclusive information, personalized offers, free earrings and even free delivery. Invitations to exclusive events can also be included in your surprise loyalty programs.

Mercedes Benz screams luxury and fashion in every way despite not being a fashion brand. They jumped on the “Surprise and Delight” bandwagon by interacting with existing and potential customers via social media.

They took advantage of the hundreds of messages received daily on their Facebook and Instagram accounts. By introducing #MBSecretSantathe company interacted directly with customers to give away 1,000 gifts ranging from branded teddies to Bluetooth speakers.

You can do the same for your luxury fashion brand. Give jewelry, clothes and even a real diamond stud to a lucky winner.

4. Organize exclusive events

Brands with huge followings usually cannot host exclusive events. Imagine that Amazon invites millions of people to attend a dinner party. Even if they do, their cost-benefit ratio might not support the effort.

Luxury fashion brands don’t have this problem. They can only invite a few hundred of your customers and be done with it. Also, if your brand doesn’t have a large following, it’s much easier to organize exclusive events.

Hugo Boss has been associated with luxury fashion for decades. They specialize in clothing, accessories and fragrances for men and women. As well as introducing free membership tiers, they are offering their loyal clients exclusive VIP events.

To organize a successful event, you do not necessarily need to spend a fortune. As an evolving luxury brand, at these events you should focus on exclusivity, promoting your products such as diamond jewelry, not high-end features.

Suppose you are a brand specializing in limited edition sneakers. You don’t necessarily need to bring athletes to your event. At least you can run a cybersecurity boot camp for loyal customers to educate them on the risks of using sneaker bots.

5. Introduce a privilege program

Brands often rent out resorts, clubs, and restaurants for their loyal customers to enjoy at a discount. Customers can stay in branded establishments at a cost that exceeds their expectations. The practice is often tied to membership tiers to encourage customers to make more purchases.

With a privilege loyalty program, your customers will try to buy more from you just to keep their privilege program active and enjoy the best facilities in town without paying a premium price. Your competitors may offer the same brand value at a similar price, but your customers will keep coming back to ensure their account stays active.

An added benefit of introducing a privileges program is that you do not need to occupy resorts or clubs throughout the year. If a customer wants the benefit, you can process the request to make room for them.

6. Paid Loyalty Programs

In a paid loyalty program, your customers pay a monthly or annual subscription fee to receive the benefits associated with it. Most brands – luxury or not – introduce paid loyalty fees on their platforms to prevent users from switching to their competitors.

Since customers are directly asked to pay additional fees on top of the price of your product, program features should have monetary value. Free shipping, loyalty discounts, and exclusive invites are usually considered in paid loyalty programs. But you can introduce different features at your convenience to satisfy customers.

7. Wellness Loyalty Programs

As a society, we thrive on helping others, and human well-being drives us more than anything. Rolex is a striking example. The brand is owned by the Hans Wilsdorf Foundation, which provides scholarships for students in Europe. Most of the profits made by the watch brand are invested in ensuring the future of students.

Your brand can also use something like this. Plus, if you’re just starting out and don’t have the money to spend, you can fund a large amount yourself and ask your clients to add their share. By following this path, you directly promote your actions and engage the public to buy more.

8. Introduce experimental programs

After Gucci was accused of racism and colonial nostalgia, they took the #Changemaker program in 2019 who tries to exonerate himself from the accusations and present them in a new, non-binary and inclusive light.

In this program, they nominated unconventional models and actors for their promotion, in addition to launching a new collection of clothes that can be worn by both men and women.

Although these efforts had a significant impact on improving Gucci’s brand image, they were all experimental. They experimented with their loyal customer base to make themselves more inclusive to all ethnicities, which boosted their sales.

The essential

A luxury brand can give back to its valued customers while ensuring that they remain loyal to the brand. Exclusivity, surprises and well-being are the fundamentals for developing loyalty programs.

But don’t forget to consider events, early access, invites, and experiential programs when considering the best luxury fashion loyalty program. You can also give high-end gifts like diamond earrings and watches.

Choose the option that best suits your customers and your brand!

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8 tips for luxury fashion loyalty programs






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