Welcome to TLC UK

Fashion Retailers

Revealed: what millennials want from a fashion loyalty scheme

Posted by danielle.gamage | 11 May

Fashion retailers targeting millennials operate in a competitive and challenging trading environment. TLC Marketing decided to step in and uncover the retention challenges brands are currently facing, with a fashion loyalty survey of 100 UK millennials, investigating what it is that motivates them to stick with a fashion brand.

Millennials see fashion as an opportunity to express their individuality and personality. Understanding them in this way allows marketers to plan communications and loyalty schemes more appropriately – making the relationship a personal and unique one that fits into their lifestyle.
The industry is currently full of designer collaborations, discounts and promotional codes but there is a desire from millennials for emotional added value which will lead to an increase in spend and brand loyalty.

Did you know that 78% would rather spend money on an experience than a tangible good? Material objects are less of a desire to this generation and being given the chance to seek out shareable experiences makes them feel culturally richer and more satisfied. Experiences, when packaged as rewards, incentivise millennials to buy and they’ll choose a brand offering an emotional added-value reward over a brand who isn't every time. Millennials tend to engage more with brands who transform their story-telling into story-doing. For instance, Dr Martens and music have complemented each other since Pete Townshend became the first high profile individual to wear them in the 1960s. In doing so, he changed the course of the brands identity from functional work-wear, to a subcultural essential. In the 1990s the brand became synonymous with festival culture so, in 2015, Dr Martens brought the music to customers ears by giving £30 towards a gig ticket already purchased, or due to be purchased in the future. 

Millennials ‘get’ loyalty schemes. All 100 respondents could name at least three brand loyalty schemes they are part of. However, there wasn’t one fashion brand listed in the top five…in fact, not even in the top ten. ASOS had the most recognised scheme, but only six people mentioned them. They were followed by Boux Avenue (two), Miss Selfridge (one) and House of Fraser (one).

We found that Boots topped the leader board with over half of respondents owning an Advantage Card. Nectar, Superdrug, Nandos and Tesco are also among those most favoured by millennials.

Respondents top reasons for joining Boots' loyalty scheme:
1. Convenience
2. Easy to collect points over time and save up for big spending occasions like Christmas
3. Already shop there frequently
4. Rewards with actual benefits
5. Discounts make it easier to save money

This research tells us that the loyalty market is waiting for a fashion brand to lead the way with an integrated loyalty scheme combining creativity, technology and world leading rewards for a true exchange in value. To do this, brands must listen to what their customers want. In our survey, free meals and travel rewards lead the way in terms of what millennials want in exchange for their spend. Next in line were spa days, wellness treatments and days out. We also asked what else they’d be interested in as a reward to spend more instore or online. Below are a few of the responses:

• Early access to event tickets
• VIP glamping experiences
• Loyal customers exclusive shopping night
• Faster/free shipping
• Gym/fitness classes
• Magazine subscription
• Free travel (TFL points)
• Free beauty products or samples

Creating genuine loyalty

74% of millennials agree that they ‘enjoy the shared experience of events’ and 75% attend at least one music festival per year. ‘FOMO’ (fear of missing out) is undeniable among this demographic with every event being documented and published. So, to gain true loyalty, brands should consider rewarding this type of behaviour and increase the number of ‘soft benefits’ in a scheme. By rewarding customers for actions other than transactional spend you start to build true engagement with a return of actual, genuine loyalty. 

For more information download this eBook, Five rules to running a successful loyalty scheme.


eBook: Things you only know if you are a student

eBook: How to market your brand to students

eBook: 8 Ways to increase your engagement with mums