When money is tight, consumers get savvy. Despite the recent fall in UK inflation, retail costs and prices remain high. This doesn’t mean that people have stopped indulging in their fashion purchases, but they are shopping around for the best value. For any brand that doesn’t adhere to fast and cheap business models, customer loyalty can be hard to come by.
Yet some factors are working in their favour. As more and more consumers learn about the environmental harms caused by fast fashion, for instance, they’re adopting a “buy less, buy well” approach. There’s a growing appreciation of good quality and fit – of clothing that lasts longer, stays stylish and offers a lower long-term cost per wear than that provided by cheaper buys.
Companies that consistently provide excellent customer service are also distinguishing themselves online, especially among consumers facing fees from other firms for returning unwanted purchases. There’s a broad acceptance among higher-end brands that free returns are part and parcel of their offering. Several industry analysts believe that this facility alone fosters loyalty, even though it’s a demonstrably eco-unfriendly practice. At the other end of the market, firms including H&M and Boohoo have made it part of their loyalty club offering.
Here, three senior decision-makers in the online fashion sector reveal how their businesses have secured market-leading levels of customer loyalty, despite a range of challenges.
In online fashion, people give up on a brand when they try something on at home and it doesn’t fit them well. This is even more apparent in footwear. It’s not as though you can go round a shoe shop and try on various styles. Often, one style won’t fit but another will suit you better – and that’s just down to the shape of your feet.
Calla shoes are for people who have problems with their feet and are seeking comfort. Building loyalty from the first purchase is one of our biggest challenges. We do two things to achieve this.
First, we try to do as much at the start of the customer journey as possible, so that people buy right first time. We ask them to measure their feet, take photos of them and tell us about any problems, so we can advise them on the best shoes for their needs.
Second, if they still need to return a purchase, we’re available on chat and email to help them do that. Good customer service is crucial.
Once we’ve got them, they are very loyal: 40% of our first-time customers will buy from us again within 12 months. The potential cost to them of switching away from us is quite high, because they might not find the same level of comfort with another brand.
You shouldn’t confuse brand awareness with brand loyalty. Gaining awareness is great for that first purchase, but loyalty is the sum of all the work that follows. This entails making it easy for people to buy and return items free of charge while providing excellent service – even offering loyal customers VIP service and as much of a personal touch as possible.
Our customer services manager used to work for Mothercare and Lush, two brands renowned for offering high standards of personal service. She goes above and beyond regularly to help customers, but she can’t always be there for everyone. AI is the buzzword of the moment and there are some good apps out there, so these technologies offer a potential solution.
In fashion, it’s important to take customers on a journey of discovery each season by introducing a lot of newness: new techniques, new materials and new ways of using them. That makes people want to return and buy the next new thing.
Luxury pieces are a more considered purchase than fast fashion items, of course. It’s important for us to build a genuine connection with people and deliver impeccable quality to encourage brand loyalty. With this in mind, our online communications focus on adding value to customers through education, styling advice and priority access to new collections and promotions.
For instance, we’ve been trying to educate people to build a collection – to wear not just one bracelet but several in a stack – so they’ll come back to us next season and add something to that stack. There is a loyalty scheme, but we also send birthday vouchers to customers.
We try to be innovative in what we offer each season. We push boundaries with our design and materials, so that the “Tateossian look” our customers come back for is not similar to anything else on the market. We change the collection by 40% each season, even though jewellery doesn’t need to be seasonal.
It takes careful consideration to ensure that we present the right product to the right customer at the right time. We drip-feed the collection over several months, aligning with key seasonal moments. This includes making sure that we place beautiful images on social media and in our other communications. You have to nurture your customer. Maybe someone can’t buy for a season, but you need to keep in touch with that individual and offer them that personalised service.
It’s also about adapting to trends. For instance, climate change has affected sales of shirts and jumpers, which has in turn affected cufflink sales. Also, after Covid, there was a period where people were wearing loungewear more. We were selling more bracelets and necklaces while cufflinks took a back seat, but now the trend is moving towards dressing up again. We didn’t abandon cufflinks entirely just because of a shift in the market.
When discussing how to build brand loyalty, people will definitely talk tactics – customer relationship management and loyalty promotions, for instance. But the macro answer is strategic: you’ve got to make great products. It’s a statement of the blindingly obvious, but it’s the only real solution.
If you can sell a guy a pair of trousers that fit flawlessly and then deliver another pair to his doorstep that also fit, you’ll probably have a customer for life. Between 40% and 45% of ours come back to us within a year.
It’s hard not to feel the effects of serious economic headwinds on your P&L. The answer under these conditions is to play the long game. The obvious tactic would seem to be to offer discounts – and we will offer them to our loyal customers occasionally. But it’s incredibly dangerous to rely on discounting, because it ruins the economics of your business. It’s not a lever you’d want to pull often.
You must keep up the drumbeat around newness and provide reasons for customers to return. This is about communicating but also about ensuring that you have a supply of great new product coming that delivers on consistency, so that people can shop with confidence.
Being famous for something is important. We worry about fit and legwear. But now we’re cross-selling a bunch of tops too – they have all got a “fit” angle to them. We’re building bigger baskets as a result and we’re getting people to shop with us more frequently.
Innovation gives people a reason to stay and sample what’s on offer. But, once you start adding to your range, you can quickly dilute your proposition. You need to be circumspect when doing so. That said, though, newness matters.
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Disclaimer: The views, information and opinions expressed in this article are those of the people interviewed and do not necessarily represent or reflect the views of Intuit, Mailchimp or any of its cornerstone brands or employees. The primary purpose of this article is to educate and inform. This article does not constitute financial or other professional advice or services.
