The PURSEuit of Happiness
Why the Luxury Category Continues to Please Program Participants
By Alysa McKenna
A gal can never have too many handbags.
There's the everyday bag, which changes with each new season.
There's the "night on the town" bag, which is just about large enough to hold keys and a cell phone.
There's the evening bag, which is necessary for any black tie or cocktail function…
You see where this is headed.
When selecting an item for herself, the answer to the question, "do I need another handbag?" is rarely the point for a woman. Wanting and needing are entirely different things.
The question of wanting vs. needing frequently arises when speaking about redemption trends. Some participants redeem for items of necessity, while others shop for items of aspiration. As a marketer, the ability to be nimble is critical. Realize that the trick to satisfying your total audience is having a rewards portfolio that plays to both sides of the spectrum.
For the past 20 years, Rymax has maintained a very robust client base, with audiences that vary greatly both demographically and geographically. Because of that, we've been able to gain valuable insights into the redemption habits and patterns of rewards participants at all different levels.
We realized early on that there is no such thing as "one size fits all" when it comes to rewards. We saw an opportunity to eradicate the cliché "gold watch" methodology and pioneer new categories of reward options. This is what started the shift toward handbags, jewelry and other luxury items.
Then, as the rise of the e-com channel and discount retailers grew stronger, luxury brands began to seek—and today continue to seek—new outlets to sell and distribute their products, which further propelled the popularity of handbags (and other luxury goods) within the incentive world.
So why do handbags and luxury goods see so much success in our programs? It's because consumers love "trophy items"—items of stature of which they can be proud. Items like handbags will always have a place in rewards programs because name brand products give rewards participants a trophy value that is long-lasting. And also because, well, as we've already established, a girl can never have too many handbags.
Highly recognizable brands like Michael Kors and Kate Spade are doing really well in our programs right now because the fashion-conscious consumer seeks out names that they know and trust. In terms of style, everything old is new again. Trends fade and then reappear. So items like backpacks and signature-styled handbags are really popular. There has also been a resurgence in our programs of iconic brands like Coach and MCM.
Timepieces are also experiencing a rebirth. Trending brands like Breitling always remain an item of aspiration, but a new generation of watches is growing within both the technology category—with the birth of smartwatches, and the ath-leisure category—due to the popularity of fitness trackers.
The takeaway here is that regardless of the category, regardless of changing trends, the common denominator in a successful program is perceived value. It's critical that the rewards offered in incentive programs are highly desirable. At Rymax, we insist that our programs offer products with high brand equity and the "latest and greatest" models. It's crucial to design a program that strategically targets its audience with a wide variety of trending products that excite and motivate today's consumer.
Remember, the goal of a loyalty program is to fuel customer happiness and encourage retention. No single product or brand will evoke the same response across all demographics, so give your rewards participants plenty of options and let them dictate what they crave.