It’s a pretty disloyal world out there, but can you really blame the consumer? Online shopping has never been easier, and stores have been stepping over each other to see who can offer the deepest discount. While discounting your way to a one-time purchase might work in the short term, at the end of the day, you need to aim for a higher prize: customer loyalty.
Many retailers attempt to accomplish this with an official loyalty program. There’s just one problem – they rarely work.
The retail sector is going through drastic changes. Established names like The Limited are closing or filing for bankruptcy. Amazon and WalMart squeeze everyone’s margins. Special discount shopping days like Black Friday have morphed into Gray November, a month-long deep discounting period. As brands fight to keep up with competitor discounts, profits and customer loyalty are harder to earn.
I recently spoke with a fashion retailer who recognized the endless discount cycle dilemma. They had been stuck in this discounting rut, but did not want to be known as a discount brand. They prided themselves on making quality product at a decent price and this constant discounting was bad for their brand and devalued their product. This past holiday season, they made a straight forward business decision: No guts, no glory. At their busiest time of the year, they chose to not discount.
