LUISAVIAROMA Increased Revenue by 4.7%, Making Millions in Profit

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1 FASHION RETAIL LUISAVIAROMA Increased Revenue by 4.7%, Making Millions in Profit CASE STUDY Loyalty Members +10% Average Order Value +4.7% Increase In Revenue 293% Return On Investment The established Italian-born global fashion company searched for a loyalty program provider to cope with the continuous increase in customer acquisition costs. Learn how Antavo helped them create a highly integrated loyalty program which has given the retailer nearly 3 times the return on their investment, with millions of dollars in profit, and has sparked their highest converting campaign. The Challenge: Moving forward in a competitive market With the rise of online luxury stores, the competition has gotten fierce. The transparency of prices and the boosted number of online shopping options has made harder for luxury retailers to acquire new customers. That s one of the reasons LVR decided to shift their focus from customer acquisition to customer retention by introducing a loyalty program. However, they knew they were taking a risk, as luxury loyalty programs were said to be ineffective among affluent buyers.

2 The Need: A scalable loyalty program that provides a personalized experience globally LUISAVIAROMA turned to Antavo to create a loyalty program which would fit their brand image and attract interest from their audience. Their main concept was to recognize their loyal shoppers globally, expanding far beyond their home market in Italy. They required a loyalty program that could be managed from one platform and allow them to communicate differently for each of their regional markets. That s why LUISAVIAROMA needed a program that would: run in multiple languages and currencies* reward customers differently, based on spend reactivate customers by including loyalty data in campaigns *LUISAVIAROMA operates in multiple markets. A crucial requirement for their loyalty program was that it should function in 8 languages (English, French, Deutsch, Italian, Chinese, Korean, Spanish and Russian) and using 4 different currencies, such as EUR ( ), GBP ( ), US dollar ($) and AUD dollar ($).

3 The Solution: A multilingual loyalty program that rewards top spenders First, LUISAVIAROMA initially launched the LVR Privilege loyalty program in Italy. One month later they rolled out the program worldwide. Before the launch, they went through the following steps to ensure their success. Step 1: Completely integrate the program with LVR s existing systems Once the multilingual and multi-currency environment was finalized for LVR, the loyalty program was wired to their custom-developed ecommerce platform using Antavo s SDKs, APIs and webhooks. Another key aspect of the loyalty program was making loyalty activity a part of LVR s campaigns. LVR s service provider, Emarsys, has full integration with Antavo. Find out more about the integration in Emarsys Enhance directory. Step 2: Create a loyalty mechanism that involves gamification and tiers In addition to rewarding online purchases with points, LVR decided to incorporate several of Antavo s gamification modules. LVR gives members points for the following online customer engagements: Loyalty program enrollment Profile completion Social account connection Sharing LUISAVIAROMA products By rewarding a variety of customer actions in addition to purchase, LVR could soften the discount-oriented loyalty concept. They maximized this effect by introducing special customer tiers, each with different and exclusive benefits i.e. birthday points, exclusive rewards and VIP events. These benefits ensure that luxury shoppers see the rewards that each tier provides access to as exclusive and valuable, which helps cultivate an emotional connection with the brand.

4 The Solution: A multilingual loyalty program that rewards top spenders Step 3: Build high-converting campaigns based on loyalty data Antavo s integration with LUISAVIAROMA s service provider, Emarsys, has allowed LVR to create loyalty campaigns to reactivate their buyers. The s they ve sent out include: Loyalty program announcement Pending points Loyalty point status in newsletters Among these s was LVR s highest converting among all of their campaigns: the pending points . This notifies customers that they will soon receive points, and it generated an open rate over 65% and a click through rate of more than 20%. (According to retail industry standards, this type of typically averages an open rate of around 12%, and a click through rate of approximately 7%.) LVR has plans to introduce more loyalty-specific campaigns, mainly focusing on re-activating defecting customers. To reach this group and maximize the effectiveness of these s, they intend to involve additional gamified modules in their loyalty program, such as sweepstakes, and introduce exclusive rewards from their partners.

5 The Results: 293% ROI generated in just 3 months The most outstanding aspect of the program is that in a relatively short timeframe following the global launch, it has generated impressive results for the company. In three months time, the program generated the following numbers: 293% return of investment 10% uplift in average order value 5% uplift in frequency of purchases 4.7% uplift in revenue Among LUISAVIAROMA s rapidly growing customer base, the program has activated mostly high spenders. In fact, 10% of top of the loyalty members have generated 55% of LVR s total revenue. The program now has members in total. The segment of customers who have already redeemed their points for rewards, the proportion of customers with 2 or more transactions is higher compared to those who haven t redeemed their points yet, and this group has already redeemed an impressive 50% of points earned.

6 CONCLUSION LUISAVIAROMA has proven that loyalty programs can work in the luxury industry, and it s crystal clear that their program has a lot of potential. That s why the company is planning to expand their program by targeting lower- to medium-spend customer segments, involving soft activities and marketing the loyalty program more actively, in an effort to generate even higher activity in the loyalty program. Before we launched the program, we were very confident to see results in the medium-long term. Contrary to our expectations, right after launch, we started to see huge growth in order frequency and order value in our best segment of customers. This resulted in an immediate increase in overall revenue. - Marco Ritratti, CRM Manager at LuisaViaRoma CONTACT LUISAVIAROMA has been a retailer in the luxury fashion market since Online since 1999, the company now attributes 95% of total revenue to online sales. They first stepped onto the international stage in 2004, first translating LUISAVIAROMA.com into English and they now operate in eight languages total. The website receives four million visits per month, and is produced and maintained by 200 people from 15 different countries, in LUISAVIAROMA s Florence headquarters. Antavo was founded in 2012 with a marketing software for lead-generation. After seeing the need for a solution that helps retain customers, they entered the world of loyalty reward programs in 2015, and launched their loyalty platform for ecommerce companies in Moving beyond rewarding exclusively online customer actions, their latest product helps multi-channel retailers reward loyalty online, mobile and in store. Clients include leading brands such as Toys R Us, LUISAVIAROMA, and Björn Borg. To learn more about Antavo s loyalty programs, please contact us.