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Tailoring Loyalty Programs to Customer Desires Is the Key to Boosting Luxury Consumer Spending

Loyalty programs have a dramatic impact on the spending of Young Affluents, but the programs must have the �wow� factor to stand out from the rest

Stevens, PA May 11, 2007 - Filling the wallets and hanging from the key rings of most Americans are the membership cards and key fobs that mark the holder as a participant in a loyalty program. These programs have the potential to entice the holders to spend more money in the store or on the brand sponsoring the program, but the programs must be carefully crafted in order to stand out from the pack and to encourage the most affluent consumers to spend more.

"Over three-quarters of all luxury consumers are members of at least one loyalty program, so starting such a program is clearly not difficult. What luxury brands and retailers need to learn are the key attributes of their brand as viewed by their customers so that they can design their loyalty program to be appealing to their unique customer base," says Pam Danziger, president of Unity Marketing and author of the new book, Shopping: Why We Love It and How Retailers Can Create the Ultimate Customer Experience.

To learn more about successful loyalty programs targeting the luxury consumers, Unity Marketing has completed a study on loyalty programs and its impact on luxury consumer spending as part of its quarterly Luxury Tracking study (http://www.unitymarketingonline.com/cms_luxury/luxury/luxury3/luxury1Q2007.php)

The report includes profiles of some of the most effective loyalty programs in the marketplace today targeting the affluent, including American Express Platinum Rewards; Neiman Marcus InCircle; and Starwood Hotels & Resorts Points programs. Copies of the report are available through the link above.

Loyalty Programs Are Key to Attracting Young Affluents
Loyalty programs are nothing new, but what is new is how strongly loyalty programs influence the spending of the Young Affluents, the cohort of luxury consumers 40 and under that correspond roughly to the GenXer and Millennial generations. As detailed in Unity Marketing�s recent Generations of Luxury report (http://www.unitymarketingonline.com/cms_luxury/luxury/insights_study.php), these younger consumers are changing the face of luxury and, along with it, the loyalty programs that will entice them to buy.

"Luxury consumers who belong spend half as much again as the average luxury consumer. That fact alone is enough to emphasize the value of loyalty programs to the value-driven affluent customers. However, the young affluent consumer who is a member of a loyalty program spends twice as much on luxury a non-member of the same age group. This emphasizes the tremendous value in attracting these young affluent consumers to become members of your brand's well-crafted program," says Danziger.

Secrets of Successful Loyalty Programs is Understanding the Consumer
In the recent special report on loyalty programs, included with the Luxury Tracking 1Q2007 study, those who design, market, and sell luxury goods and services will get the facts to support developing a loyalty program for their brand, or at the very least to conduct serious due diligence on implementing a program.

"Unity Marketing brings research expertise to luxury brands that will help them measure the effectiveness of a loyalty program for their business," Danziger says. "The secret of implementing an effective and profitable loyalty program is to design it around the desires and expectations of the brand's unique customer base."

Consumers insights will guide the development of a luxury loyalty program by discovering:
- The unique 'wow' factor that will make a new luxury program compelling for the consumer;
- What types of rewards would be most effective for your company's brand loyalists;
- Whether your brand's loyalty program could gain from partnering with other brands; and
- What program structure is most effective in encouraging spending.

"Deciding to offer a loyalty program is the easy part. However, understanding what makes these programs attractive to luxury consumers can mean the difference between cultivating an enthusiastic repeat customer and simply becoming another plastic key fob or card in the wallet," says Danziger.

If you are interested in learning more about loyalty programs for the luxury consumer, please call Pam Danziger at 717-336-1600 or email her at pam@unitymarketingonline.com She can explain the findings in the new luxury loyalty research and how your brand can approach developing a loyalty program for your affluent customer base.

Unity Marketing is also currently seeking sponsors for the upcoming Luxury Tracking 2Q2007 study to be fielded on or about July 15, 2007 and covering the habits of luxury consumers during April through June 2007. Sponsors have the opportunity to contribute some questions or research topics to the survey, and they will receive the results in advance of their general publication and sale date. More information is available by contacting Unity Marketing at the phone number listed above.

For media: Charts, tables and graphs are available on request.

About Pam Danziger and Unity Marketing
Pamela N. Danziger is an internationally recognized expert specializing in consumer insights, especially for marketers and retailers that sell luxury goods and experiences to the masses or the 'classes.' She is president of Unity Marketing, a boutique marketing consulting firm she founded in 1992.

Advising such clients as Cartier, PPR, Diageo, Stearns & Foster, Waterford/Wedgwood, Prudential Fine Homes, Ritz Carlton, Orient-Express Hotels, The World Gold Council, The Conference Board and American Express, Danziger taps consumer psychology to help clients navigate and master the changing luxury consumer marketplace.

In recognition of her ground-breaking work in the luxury consumer market, Pam received the Global Luxury Award presented by Russia's Harper�s Bazaar for top luxury industry achievers in 2007.

Her latest book is Shopping: Why We Love It and How Retailers Can Create the Ultimate Customer Experience, published by Kaplan Publishing in October 2006. Her other books include Let Them Eat Cake: Marketing Luxury to the Masses--as well as the Classes, (Dearborn Trade Publishing, $27, hardcover) and Why People Buy Things They Don't Need: Understanding and Predicting Consumer Behavior (Chicago: Dearborn Trade Publishing, 2004).

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