Loyalty programs for Fashion Retailers are getting better. Here's why

Fashion retailers know that successful brands become part of customers' identities in a way that few other consumer goods do.
loyalty programs for fashion retailers

For a long time now the accepted wisdom has been that fashion – particularly high-end fashion – and customer loyalty programs were poor bedfellows.

The former is synonymous with exclusivity, luxury and scarcity; the latter with discounts, value-for-money and mass-market appeal. Given how much time, money, and effort goes into building a fashion brand, it’s understandable that such companies have been reluctant to explore loyalty programs.

Until now, that is.

In this article, you will learn:

  • What has changed for Fashion Retailers?
  • The arrival of Loyalty 2.0
  • Loyalty programs are a direct driver of sales for fashion brands
  • What’s next for fashion retail?
  • Conclusion

What has changed for Fashion Retailers?

What’s changed is the availability of unprecedented volumes of customer data along with the emergence of advanced retail analytics engines.

Every single customer touchpoint – from point of sale to e-commerce to customer service to social media and more – can now be mined for information, helping brands build detailed, 360-degree profiles of their customers that can in turn be used for one-to-one personalized marketing.

Today loyalty programs are of interest to fashion retailers because they make it much easier to identify individual customers across channels.

They provide a framework by which fashion retailers can collect consented customer data including transactions, visits, customer service engagements and more, both online and off.

In a virtuous circle, fashion retailers build up much more detailed pictures of their customers including their likes, interests, and hobbies. This information can then be used to create richer loyalty experiences than the old coupons and discounts approach.

Think of it as Loyalty 2.0.

We are talking about a high-end loyalty program that adds to brand values such as exclusivity and luxury.

Such programs go beyond discounts and offer customers relevant VIP experiences, such as access to certain collections, personalized products or back-stage passes to must-see music events.

They are also used to reflect the ethics and values of customers to build a sense of shared purpose. For instance, some retailers now offer customers the chance to donate loyalty rewards to a charity of their choice.

Fashion retailers know that successful brands become part of customers’ identities in a way that few other consumer goods do. Thanks to advanced data analytics and digital tools, loyalty programs can now be built to extend and enrich that sense of belonging and identity, so that the brand becomes ever more ingrained in the life of their customer.

As a result, loyalty programs become a direct driver of sales for fashion brands.

This happens in two ways:

#1: there is the immediate sales boost that comes from using loyalty programs as a channel for boosting sales through perks and benefits to members – one of the more traditional benefits of loyalty programs.

#2: by providing a better understanding of customers’ behavior, loyalty programs enable fashion brands to boost sales through personalization; providing the highly curated experiences that fashionistas love.

Loyalty programs for retailers, therefore deliver a raid ROI that should be very appealing to most retailers.

What’s next for fashion retail?

This is an exciting time for the industry, with a virtually untapped resource available for use.

My view is that fashion retailers that work with ecosystem partners will be best placed to succeed, so long as these partners share their purpose and values.

Loyalty ecosystems will play a crucial role in evolving beyond discounts for purchases to brand relevance programs, where the partner choices a brand makes enhances the relevance of the program to its members. So for instance, a fashion brand associated with the hip hop scene needs to ensure its program partners are authentically a part of that scene, whether that’s musicians, music labels, content venues or festivals.


My advice for any fashion brand looking to launch a loyalty program is therefore threefold:

#1: make sure you define your purpose and values, as that will inform who will fit into your loyalty ecosystem.

#2: invest in the right IT and data infrastructure – here agile cloud-based platforms are the place to go as internal systems development will be costly, disruptive and likely below the standard set by the experts.

#3: hire the right team to activate your customers’ data in order to increase loyalty and retention effectively and efficiently.

Done right, loyalty programs will add a new item to the fashion marketers’ toolbox, one that will help set the best out from the rest.

If you’re a fashion retailer and you’re planning to launch a loyalty program or improving an existing one, then get in touch with one of our team – we’ll be happy to show you examples or talk through your brand’s unique challenges.


This article has been written by Loyal Guru’s content team, together with Guillermo Corominas.

Guillermo Corominas has over 15 years of experience in the fashion industry, having worked as Chief Customer and Marketing Officer at MANGO, and he is currently Europe Sales VP at Loyal Guru.