Post COVID-19 as an E-Commerce Brand: Experiential Loyalty Programs

Here in the heart of the pandemic in New York City, there is some glimmer of hope with hospitalization rates going down as of April 9th, 2020. As the smoke clears from this pandemic, we’ll see the bodies on the street when it comes to the economy. The good news for e-commerce is that more people will shop online for the next 6-12 months due to social distancing but you have to make sure your brand is positioned for success. The only way to thrive during the post COVID19 era is by getting closer to your customers by building loyalty instead of just giving out discounts. We’ll be going over www.revolve.com and how they’re positioned to thrive over the next few years with their incredible loyalty program. 

Revolve, the social media influencer fueled fashion retailer founded in 2003 sold more than $500+ million worth of dresses, hats, and other trendy young women’s apparel in 2019. That’s a multiple of what British luxury site Farfetch, which investors recently valued at $1 billion, pulled in. Compared to Nasty Gal or Honest Company, it’s one of the few e-commerce brands standing strong. Most importantly, Revolve is profitable having grown more than 50% each year since 2012.

Unlike other fashion retailers, Revolve doesn’t have to resort to discounting to move their products. Last year nearly 80% of its 4.7 million orders placed by 1.5 million customers were full-priced, with an average order size of $275.In a research report by Cowen, they reported extremely high customer lifetime value for the brand. They found 92% of Revolve customers browse the site at least once a month and nearly 50% buy when visiting. Repeat customers are the bloodline of Revolve. Repeat customers generated 71% of total orders and accounted for 74% of the brand’s total net sales in 2019.

“We tackled the problem of how to bring fashion to customers through data and technology,” Mike Karanikola, the co-founder of Revolve shared. With the company driven by data and analytics, rather than the whims of a fashion designer, the company used that left-brained approach to design its loyalty program. “We saw the opportunity to innovate and trail blaze in loyalty programs, like we did in fashion retail,” he says.

Revolve already had a great loyalty program but recently doubled down. The key to the new four-tiered program was to design it around enhancing the emotional connections it has built with its customers. So, while loyalty members will continue to accumulate transaction-based awards the rewards that will be a game-changer will “revolve” around experiences. 

The loyalty program serves customers with different tiers of rewards and perks on points garnered through each dollar of purchase. For every 2,000 points earned, customers will receive a $20 credit to spend on the site and have the chance to make triple the points through Revolve’s brand of the month. Each loyalty tier will receive another set of perks such as early access to new arrivals/sales, personalized shopping with Revolve expert stylists, exclusive meet and greets with influencers/celebrities, trips, and opportunities to experience the Revolve lifestyle through other exciting marketing events.

Now, this type of experiential loyalty program is more applicable for e-commerce brands that already have proof of concept and market traction. If you are a brand just coming to market right now it’s the perfect time to work with a slew of influencers as their rates are suppressed due to COVID-19. Stay tuned on our next piece on how to effectively work with influencers in the post COVID-19 era.