Tony Bianco relaunches loyalty program based on experiences
Women’s footwear brand Tony Bianco has relaunched its loyalty program around more meaningful, personalised rewards and experiences, rather than one-size-fits-all discounts. Style Passport program has three tiers, with bigger and better benefits in each tier to incentivise customers to work their way up.
Rewards include member-only events, limited edition products for seasonal and birthday gifting, early access to new season products through hidden web pages and – for those in the top tier – highly personalised service, including a personal concierge.
Since launching in March, the new approach has led to a 5000-person increase in sign-ups and a 13 per cent increase in membership in the top two tiers, according to the retailer.
“Customers want to feel special, feel rewarded and not just like another transaction to the business,” Tony Bianco’s marketing manager, Danielle Truter, said in a statement.
Part of a growing trend
Developed in partnership with retail software provider Apparel21, e-commerce agency Dotdev and advertising agency Havas, Style Passport is part of an emerging trend of experience-based loyalty programs.
What was once a fairly standard proposition – spend a certain amount to receive a discount off a future purchase – has morphed into a world of exclusive events and impressive perks. Nike, for instance, has a members-only floor at its flagship store in New York City.
According to Jason Pallant, lecturer of marketing at Swinburne Business School and pillar lead for service innovation at CXI Research Group, these programs are just another facet of retailers’ broader efforts to shift away from the discount cycle and towards true connection with customers.
“It’s this idea that we now live in the experience economy, and the best way to create a competitive advantage is to create experiences that are hard to replicate and worth more to people than their dollar value,” Pallant told IRW.
This new breed of retail loyalty programs is not unlike the frequent flyer benefits that airlines have been offering for years, he said. “The thing most people value is not the points but the fact that they can use a dedicated check-in line, or go into the club because they have some status associated with their loyalty.”
Pallant expects more retailers to adopt experience-based loyalty programs in the future, which could make it harder to stand out. He says this may lead some retailers to offer ever more elaborate and valuable rewards.
“You could argue that we’ve moved past the price war and into an experience war. Rather than a race to the bottom, it’s a race to the top. How experiential can you make everything? How exclusive can you get?”
Pallant cautions retailers to take a leaf out of airlines’ books to keep loyalty costs in check. After all, airlines only upgrade frequent flyers to first class if the seats would otherwise be empty. So while customers may feel they’re getting a thousand-dollar ticket for free, the airline really is only out the cost of an extra meal.
“That’s where retailers have to think about what they are actually offering and how much it costs to give these rewards,” Pallant said.
He suggests retailers steer clear of experiences that are easy to replicate, such as having a DJ and free drinks in-store. Instead, they should offer something that is linked to their brand identity, such as giving loyal customers an exclusive look at what the designs will be for the next season.
“That will be more successful and less costly,” he said.