Benchmark of Loyalty Programs in Luxury and Beauty

Our latest benchmark, the fruit of many hours of in-depth work, has revealed the major issues in terms of customer engagement in the luxury and beauty sectors. After analyzing and synthesizing the strategies of the major brands, we found that consumer expectations are evolving rapidly in this sector, with high expectations in terms of personalization. On the other hand, brands are finding it increasingly difficult to obtain detailed customer data, so providing personalized, consistent experiences is becoming essential.

Challenges and Opportunities for Loyalty Programs in the Retail Sector

Retail is facing a double challenge: rapidly changing consumer expectations and the increasing difficulty of obtaining detailed customer data. Consumers demand personalized, consistent experiences across all touchpoints.

However, opportunities abound thanks to artificial intelligence and data analysis, which are revolutionizing personalization. These technologies offer brands the means to proactively anticipate and respond to customer needs.

BMW has understood these challenges and opportunities through its “BMW Excellence Club” program. (Spoiler alert from our benchmark) Thanks to its data capture and analysis technology, BMW is able to offer novel but above all personalized experiences to its most loyal customers.

For example: this club offers buyers of BMW luxury cars three years' automatic membership to exclusive experiences centered on sport, art, gastronomy... These activities are not allocated randomly but are targeted according to the customer's needs.

💡Customization in the luxury sector is crucial to engaging customers. Personalizing interactions reinforces the feeling of prestige and recognition, making the customer more exclusive. Find out which levers to put in place to develop this sense of belonging with our comprehensive guide to Maslow's Pyramid of customer engagement.

What are the limits of traditional personalization approaches?

Static segmentation, based on fixed criteria such as demographics or purchase history, often lacks flexibility and may not reflect changes in customer behavior or preferences. This lack of dynamism can render personalization efforts futile.

Lack of Adaptability: Many programs struggle to adapt quickly to changing trends or customer feedback, which can lead to a disconnected and sometimes frustrating customer experience.

What to expect from our Benchmark ?

Strategic program selection and clear evaluation criteria: Each program is analyzed on the basis of its originality and real impact on customer engagement.

‍

Key factors analyzed:

- Rewards system: Use of promotions, gifts and personalized experiences to reinforce loyalty.
- Program progression: Higher levels activated by purchases or challenges to stimulate ongoing loyalty.
- Access conditions: Analysis of program accessibility, whether open to all or exclusive.
- Customer segmentation: Assessment of segmentation, whether fixed or adaptive, based on dynamic customer knowledge.

‍

Our benchmark includes detailed case studies, illustrating how brands in the luxury and beauty sectors have successfully implemented these strategies. You'll discover practical examples and valuable insights to enhance your own customer engagement initiatives. For example, find out how KITH uses a three-level segmentation strategy to encourage interactions, thereby promoting data capture...

‍

‍

Download our full study for a complete overview of the best practices, and get detailed recommendations on how to maximize the engagement of your best customers.