Decoding Luxury Business’s Customer Growth Priorities (Part II)

 Every luxury business should clearly define the essential customer journeys, develop service standards for each journey, and train the Client-Facing team to deliver the experience consistently.

In last week's newsletter, I decoded the number one missing opportunity by luxury businesses from a customer growth perspective - relying heavily on the top 1% of customers. (Read it here if you missed it)

Let's dive into the other two customer-related challenges and the recommended actions:

Challenge two: Lacking a consistent clienteling practice across all stores

Often, stores rely on one or two clienteling experts to be responsible for the whole store's customer engagement. This leads to inconsistent customer journeys and clienteling attention, even to customers with similar spending contributions. As a result, the customer retention rate is low, and retained spending can not be predicted.

Every luxury business should clearly define the essential customer journeys, develop service standards for each journey, and train the Client-Facing team to deliver the experience consistently.

Some examples of customer journeys that should not be missed in a luxury retail context are:

• A prospect customer journey: Establish a standard clienteling practice for how Client Advisors should follow up with potential customers who show interest in your products yet have not purchased.

• A post-purchase thank you journey: Thank the customer for their purchase with a thoughtful message on the same day of the purchase. Follow up with the client on their experience with the purchase after a set period (e.g. one month). Proactively identify opportunities to invite the customer back with relevant engagement initiatives.

• A product launch journey: Define engagement plans by customer segmentation (e.g. preview, launch day update, etc.) to invite customers to experience different categories of your products and make the top customers feel unique with pre-order opportunities.

• A lapsing customer activation journey: Depending on the customer purchase cycle, which is the typical time between a customer's purchases, define a 'lapsing time' and have Client Advisors proactively reach out to each lapsed customer with relevant engagement tactics.

Challenge three: Bridging the global vs local gap

If you work for a regional or global team in the luxury field, does any of the below sound familiar to you:

• Are you initiating more meetings to "support" your country teams?

• Do you scrutinise your market team's execution of events to make sure they are "on brand"?

• Do you keep tight on a list of "eligible" Client gifting selections so that it is safe and measurable?

From my consulting experiences in the APAC region, I have witnessed and heard many frustrations that market teams regularly face the above experiences.

Having had the privilege of working at both global and market levels for the brands, I've learned some valuable lessons:

• More meetings don't mean more support: The reality is that more meetings with the market leaders means pulling them away from spending time with their team and customers, which should be the priority

• The obsession with perfection isn't necessary: I have heard numerous times (and experienced it personally) that a global counterpart wants the exact type of flower vase or tablecloth to be used in a client event, and sourcing becomes the sole focus for the market team. I am all for upholding a high standard of luxury client experience, yet market availability and human resources must be considered. 

• The delicate balance of global consistency vs personalisation: If you, as a global client experience leader, still insist that macaron is the only canapé allowed for appointments because it is a signature French dessert, and white and green are the only colours allowed for client bouquets because they are "on brand," then you are missing the power of true client-centricity while taking away the autonomy and creativity of your market team.

As a luxury business leader, your role in addressing customer growth challenges is crucial. It requires a dual focus on consistency and flexibility. By standardising clienteling practices across all stores, your businesses will cultivate every customer retention opportunity. Simultaneously, empowering local teams to adapt and personalise customer engagements to be truly customer-centric.