dgroup • How CRM can help luxury fashion brands to foster long-term customer relationships
The personal customer-salesperson relationship or interpersonal bond that often develops between a customer and a salesperson, which is based on trust, is an important asset in the world of luxury fashion and a crucial driver of a luxury brand’s competitive advantage. Most luxury fashion brands, have built their success on personal relationships and close contact to the fashion community and affluent clients.
In a world of overwhelming product abundance and possible substitutions, building and maintaining long-lasting lucrative customer relationships is becoming harder and harder — even for luxury fashion brands. The reason being primarily that the customer of today’s age has changed — the digital, mobile and social consumer, without a doubt, has an extremely high and demanding expectation towards a seamless, digitally enabled, multi-channel shopping experience. Requirements not all luxury brands can meet, leading to disjointed digital and physical shopping experiences, where brand touchpoints are not cohesive.
Although many luxury brands have invested heavily in a glossy online presence, investments in tools that verifiably enhance human productivity on the sales floor and thereby improve the relation with customers are comparably low. Sales professionals are more or less forced to simply remember customer information or, as in some cases, jot down customer information on notepads or in excel spreadsheets. It is needless to say that such practices do not endorse client confidentiality or data protection standards. Moreover, customers cannot be served appropriately by sales staff if they visit a different store to their “home” store. Without a centralized tool that gives sales staff a structured real-time overview of client’s contact details, status, likes and preferences as well as purchase history, they will have a hard time identifying potential product recommendations on the spot for customers.
Brands in the luxury industry must understand that moments of truth do not only happen on a social media page or banner ad, but between human beings. In these moments of truth sales professionals should be equipped with the resources and technology that can help them build relationships, not just execute transactions. Adopting a holistic and customer-centric CRM (customer relationship management) strategy and implementing a respective CRM software will help predict, understand and exploit customer needs during those moments of truth.
Elements of a successful CRM strategy
A customer-centric CRM strategy can be a very powerful tool to empower sales staff to better engage with customers. To make sure that a CRM tool fulfills its purpose, luxury fashion brands are advised to follow preparatory steps to lay the foundations for building their CRM strategy:
1) Identify and understand the issues and challenges your company faces when interacting with the customer
Does your sales staff, for example, have information readily available to them required to adequately respond to customer queries? Can your brand provide a seamless, digitally enabled shopping experience to is customers, irrespective of the channel? Is your sales staff spending too much effort on repetitive manual and administrative tasks, instead of engaging with the customer and fostering the relationship?
2) Identify customer journeys and map them to internal business processes
“A customer journey spans a variety of touchpoints by which the customer moves from awareness to engagement and purchase”. During the stages of awareness, engagement and purchase, customers come into contact with the brand through various touchpoints, e.g. your website, customer service team or the sales staff. When aligning these customer journeys with your internal business processes, you will be able to determine whether or not you are hard to do business with.
3) Know what you want to achieve and how to measure success
Defining short- and long-term CRM goals from the start is vital. This requires good planning, setting achievable and clear objectives as well as defining KPIs against which these objectives can be measured. Once KPIs are set, measure the current situation — this will provide a reference or comparison point.
Possible CRM objectives include: (1) obtaining customer insights, i.e. achieving a 360° client view across all touchpoints, (2) defining and establishing customer segments and classifications, (3) Attracting a new generation of customers and activating the existing customer base, (4) increasing engagement of sales staff with customers to drive purchase frequency and overall conversion.
Of course customer data is the basis for achieving the above mentioned objectives. This requires a set of guiding principles that align the interests of the brand as well as those of its customers, to ensure that both parties benefit from personal data collection. If customers see that they can truly benefit from sharing personal information, such as enjoying curated shopping or gratuitous tailoring services, then they will be more willing to share their personal data.
4) Involve your sales staff and drive the change within your company
Before you implement and rollout a new CRM tool it is important to communicate your CRM strategy beforehand to your sales staff. If they understand the additional value provided to them personally and the brand, they will be more inclined to accepting the change in the organization and become committed to using the CRM tool in their day to day business. Implementing a CRM strategy and tool is as much a cultural change as it is a technological one. Facilitating change within your organization demands extensive investment in the workforce, trainings and in processes. Additionally, incentives can be implemented to motivate the sales staff to improve their own performance in achieving the overall CRM objectives.
Critical success factors for CRM implementation
Of course the implementation of a CRM tool entails further strategic requirements. Once customer needs have been defined, goals set and change management implemented, the technological “side of things” must be tackled. Besides selecting a favored vendor, data flow to adjacent systems, e.g. POS or shop systems, and feature requirements must be determined. Especially the latter requires business owners to define the most CRM important features and use cases. Gathered insights will have an influence on which CRM system is selected and how it is built to meet the most important business requirements.
Luxury fashion brands must understand that technology, and especially tools that enhance long-lasting customer relationships, is extremely important in today’s retail environment — technology must be seen as a commodity evolving into a utility. So for luxury fashion brands to stay fashionable, no matter the season, adopting a customer-centric CRM strategy is the key.
If you are interested in learning more about this topic or need help in this area, please do not hesitate to get in touch. For insights into content marketing in the Luxury Fashion industry, please click here.
Anna Olivier is a Business Analyst at dgroup. She has worked for various international start-ups and retail clients, focusing strongly on digital B2C topics in the Luxury Fashion industry.
Originally published at www.d-group.com.
