Loyalty strategy to follow in the luxury sector
Claiming exclusivity in the face of e-commerce
Long queues in front of luxury boutiques, particularly in Paris but also around the world, waiting lists to buy a handbag or a trendy piece, appointments made for a simple visit... Is luxury a victim of its own success? Supply and demand, scarcity... Certainly, but luxury has a duty to be irreproachable in terms of service. Today's brands are preoccupied with the idea of protecting their customers, and in particular their loyal customers. A certain segmentation is needed to meet the needs of these VICs (Very Important Clients).
Chanel has announced that it will be opening dedicated boutiques for its premium customers in 2023. These exclusive, ultra-protected showcases will mean they no longer have to wait in the shop, but will also be able to access customised services provided by the brand. Designed for an elite clientele, these private spaces are a clear illustration of Chanel's commitment to a strategy that promotes the customer experience in the face of the power of e-commerce. Indeed, the French fashion house is one of the few in the luxury goods industry that does not sell its collections online, preferring the brick-and-mortar strategy. However, it is not a question of abandoning a certain category of customers in favour of another, but rather of being able to satisfy all targets in the most impactful and appropriate way possible.
Sup de Luxe's MBA Luxury Brand Marketing & International Management is an internationally recognised course of excellence, designed to meet the specific needs and requirements of the luxury industry. Combining theory and practice, it offers in-depth teaching on strategy, marketing, brand management and digital innovations, with the support of expert lecturers from the sector. Thanks to its extensive network of prestigious partners and a professional approach that includes internships and practical projects, this programme is a springboard to strategic or entrepreneurial careers in a globalised sector.
Relational loyalty vs. transactional loyalty in the luxury sector
In the luxury sector, customer loyalty can be approached in two distinct ways: relational loyalty and transactional loyalty.
Relational loyalty is based on an emotional and lasting bond between the brand and the customer. It is based on shared values, a personalised experience and a relationship of trust built up over time. Luxury brands cultivate this loyalty by focusing on exclusivity, brand history and exceptional service that exceeds expectations.
Transactional loyalty, on the other hand, is more closely linked to immediate incentives, such as financial benefits, exclusive offers or loyalty programmes. Although effective in the short term, this approach is less suited to luxury, where the experience and the relationship with the brand take precedence over the simple transaction.
In short, luxury favours relational loyalty, which reflects its DNA based on timelessness and excellence, rather than transactional loyalty, which is often perceived as too mercantile.
How to personalise loyalty strategies?
Special VIC boutiques, but not only. The luxury goods industry is always on the lookout for innovative solutions to build loyalty and strengthen the human aspect and closeness with its customers. We know about classic or summer pop-up stores designed to surprise and build loyalty, but to make a difference, other impactful initiatives are also being put in place within boutiques. While some events used to be reserved for the press and media, it is now common practice to invite customers to fashion shows, to visit workshops or to exclusive gastronomic dinners. The great names of Place Vendôme also often offer their best clients a top-of-the-range concierge service.
In short, nothing is left to chance here, and everything revolves around prestige service and hyper-personalisation. Because today's customers can find the same offers in boutiques in Dubai, Paris or New York, it is essential to stand out from the crowd and offer an increasingly personalised, targeted and differentiated customer relationship, and a loyal relationship that is much sought-after by the major houses, especially in a highly competitive environment.
5 loyalty strategies used in the luxury sector
Offer an exceptional customer experience
Hermès offers an immersive experience in its boutiques, where each customer is welcomed with attention and can discover the brand's world of craftsmanship, reinforcing the exclusivity of each visit.
Offering tailor-made services
Louis Vuitton allows its customers to personalise their items with the Mon Monogram service, offering options for unique colours, initials or patterns, creating a truly exclusive product.
Organising exclusive events
Chanel invites its best customers to attend its haute couture shows or to visit its creative workshops, offering them privileged access behind the scenes of the brand.
Maintaining a proactive and attentive relationship
Cartier maintains close relationships with its customers by sending invitations for collection launches, offering free maintenance services for their watches and jewellery or offering birthday gifts.
Capitalising on the brand's history and DNA
Rolls-Royce organises events such as private tours of its historic factory and meetings with its craftsmen, highlighting its know-how and exceptional heritage to strengthen the emotional bond with its customers.
It's all about adapting to and anticipating the desires of customers, and a management policy that enables luxury to preserve its image of exclusivity. As Thibaut de La Rivière, Director of Sup de Luxe, concludes: ‘The decision-making process of a premium customer is not the same as that of an occasional customer. Today's luxury goods industry therefore needs to offer highly targeted, memorable shopping experiences, as well as reserved areas, in order to preserve the notions of ‘exceptional’ and ‘exclusive’ and continue to attract a particularly demanding clientele’.