Is 'Clienteling' in Your Future?

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When you're a luxury brand, post-holiday concerns regarding how to get rid of unsold merchandise without devaluing your brand can be stressful. Perception is crucial—and a $1,500 handbag on clearance doesn't really scream cachet.

Enter clienteling. By turning excess inventory into a VIP environment for a select group of premier clients―and giving them first dibs at the reduced-price items―you're not only getting rid of unsold merchandise, which you'd have to do anyway; but you're upping engagement and customer loyalty.

Many luxury brands have leveraged clienteling in-store to place VIP shoppers at the center of the sale, similar to what luxury brands like Ralph Lauren are doing in-store. But the question is, will this strategy translate into the type of online shopping experiences premium brand customers have become accustomed to and how do you do this online?

In a word: certainly. Here's how: Brands can identify and segment these high-value, loyal customers and incrementally begin extending exclusive benefits in an agile, respectful manner. Start by carving out an audience of existing customers who should receive this exclusive benefit. The customers you choose will likely be your most loyal ones. This customer-centric approach could look at shoppers with the highest average order value (AOV), or could extend to customer lifetime value through RFM (recency, frequency, monetary) analysis.

Before taking action on this entire customer segment, start by creating unique experiences for a small group of these buyers. Here are some ideas:

  • Offer a promo code in an email to this valuable customer segment.
  • Deploy a lightbox to promote the special sale, providing entry to anyone who gives you an email address and/or refers a friend on Facebook.
  • Send out an email, plus a separate direct mail campaign, both of which use either a PURL like customername.yourdomain.com, or a vanity URL like yourdomain.com/customer name. This is a great way to create a multichannel experience.
  • Use product badging to call out items for VIPs, or create new categories that could help move specially priced products.
  • Create a banner above primary navigation or below secondary navigation that tells the returning customer about the super-secret clearance sale. Only certain customers would see the banner, giving only them access to this special area of your website.

While many brands are doing this well already, there remain some that continues to, in my opinion, misuse the concept. These brands are implementing clienteling for one-off events rather than integrating it into their overall marketing and merchandising strategies. Increasing visibility of these VIP perks can serve to motivate new, emerging customers by giving them a goal to strive toward while rewarding their loyalty.

Luxury shoppers are not unlike the average consumer who waits for the best offer and knows that a better deal will eventually come their way. However, these high-profile shoppers require more finesse and focused handling—after all they are your most valuable customers. They're powerful buyers who you don't want to upset by, frankly, treating them like everyone else.



Nathan Richter is the director of client solutions at Monetate
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