Are customer loyalty programmes fit for purpose? For luxury companies seeking a competitive edge in a post-pandemic world, that’s become a pressing question.
Through customer loyalty programmes, luxury brands have an opportunity to gather important data about their customers. This has become more significant now that big tech platforms like Apple and Google and browsers like Firefox are blocking third-party cookies. “Privacy is a huge problem. Retailers give their loyalty programmes a fancy name, but at the end of the day, it’s a way to navigate the seas of GDPR and other regulatory influences and a mechanism to get consumer consent to interact with them,” says Ludwig Voll, partner at EY Parthenon, Ernst & Young’s global strategy consulting arm.
Many luxury fashion brands do not offer loyalty programmes, although they may reward their highest spending customers with invitations to fashion shows and a dedicated concierge service. “It’s a very top-down approach and for years that has been limited to a very small group of people,” says Olivier Vigneaux, chief executive at BETC FullSix, a digital agency within the Havas Group network, with clients including Chanel, Louis Vuitton and Rimowa.