There are certain brands that evoke passion and a sense of belonging to a number of people who swear by the brand and under no condition do they even consider an option however seemly same they may be! Apple and Nike are perhaps the best examples of such brands. How many times have we seen long queues on the launch date of an Apple product or goods disappearing as soon as they hit the Nike stores, even the price of the product does not matter. This euphoria is not because the brands are promising loyalty benefits or giving tempting offers, but because the people believe in what the brand stands for and are engaged members of the brand community!
According to NPS (Net Promoter Score) Benchmarks, which is a customer loyalty metric that measures customers’ willingness to not only return for another purchase or service but also make a recommendation to their family, friends or colleagues, Apple’s NPS was 72 in 2017, significantly higher than the average NPS of other renowned companies in the consumer electronics industry, which stands at 45.
So, how has Apple been able to build such a community of loyal followers? Retail analysts believe that there are four core reasons that has made Apple the iconic brand that it is today – high attention to details; understanding the power of simplicity but in innovative ways; customer-centric business model instead of revenue-generation approach; and last but not the least excellent customer service once the product is sold.
The fashion industry also has its engaged communities that have propelled brands like Nike, Gymshark, Lululemon Athletica to create relevant and long-term loyalty, far beyond that of traditional loyalty programmes.
Why is Community Building more rewarding than Loyalty Programme initiatives?
The reality is that most of the customer loyalty programmes today aren’t about generating long-term customer loyalty and affinity anymore, but are more focused on pushing consumers to increase financial transactions. It is now common for most of the fashion and clothing brands to entice customers with various offers and tag them as a ‘loyal customer’ by giving some points. The ‘cost’ of the tag is to do any of the following for them – write a review; follow them on social channels; share their products among your circle.
These marketing tricks may generate business, but certainly not a community of valuable, loyal and engaging customer segment for a brand? As they say – ‘loyal customers are gained not asked’. Growing your audience base may help increase sales, but building an engaged community leads to loyal customers who help promote the brand with passion and ownership without asking for the same.
True loyalty is emotional and leads to customers feeling like they’re part of the brand’s exclusive membership group which then leads them to become loyal subscribers or consumer network participants. People appreciate being part of a community and feel bad when they’re not.
From a revenue perspective too, retaining loyal customers is far more fruitful for a brand than finding tens of thousands of new customers. The Pareto principle, which advocates that 80 per cent of revenue is generated by 20 per cent of returning customer base, is the foundation of community building. This 20 per cent customer base is most likely to make more purchases than new customers because they have a relationship of trust with the brand, resulting in more conversions. The next big connect for loyal communities could be sustainability and ethical practices.
This is how fashion brands are building communities
Gymshark: One of the fastest growing fitness apparel brands Gymshark has seen remarkable growth in recent years which is contributed by the strong community the brand has built. With ‘Gymshark Central’, the brand makes it easy for both new and returning customers to dive into their community without any hassle. Gymshark Central is a platform for blogging where it is studded with articles that have tips, tutorials and exercises. These blogs are packed with plethora of health- and fitness-related information that has positioned them as their members’ go-to place for health- and fitness-related issues. This makes it easy for the customers to decide and purchase products in order to strengthen their connection with the fitness community.
Lululemon Athletica: If there is one brand which has disrupted the athleisure and yoga apparel industry then it is Lululemon. The luxurious yoga gear serves as the heart of the brand’s diverse product line and the brand community of Lululemon is built around empowering their customers to lead a healthy and active lifestyle. One of the key things they do is to offer a chance to its members who have never tried yoga to join a free yoga class or attend one of their festival’s events and enjoy the experience of being a member of the community. All these gatherings enable Lululemon’s community members to sweat, meditate and stay away from life’s chaos. And, of course, the brand’s community members love it.
Charlie Hustle: Sports can make connect people like no other thing can do and that’s the edge that Charlie Hustle has taken to create their brand community. The sports t-shirt brand offers customers the chance to show their hometown pride through their Kansas City dedicated clothing. The feeling of community that is intrinsically displayed in every Charlie Hustle’s t-shirt is what customers love most about the brand. The customers are easily recognised as a part of the brand’s community when they proudly wear their t-shirt. Adding to this, Charlie Hustle also offers a rewards programme in order to keep the brand community members engaged. Valuing local community engagement by celebrating hometown pride is a perfect fit for local brands like Charlie Hustle.
Nike: One of the oldest sports/active wear brands to have a loyal community of followers is Nike. In fact, the connect is so strong that sports enthusiasts and Nike go hand in hand. The famous brand has partnered up with broader social media platforms like Twitter and Instagram to directly engage with customers as well as focus its efforts in developing its own social community. Nike has been able to deliver mass customised products successfully at a time when other competitive concepts such as Tinker Tailor and Burberry Bespoke shuttered!
This has become possible with its NikeiD app which offers customers the opportunity to share and vote on customised designs, meanwhile providing Nike with great insights into what products/designs really resonate with its customer base. This ability to engage and tap into the customer community has proven to be an asset to Nike.
In conclusion it can be stated that loyalty programmes that effectively bribe people into buying more of your products are lazy. In the modern aspiration economy, people develop true brand affinity only when it gives them a sense of community. Done right, membership strategies are an effective way to achieve that goal.