The conundrum of luxury and premium brands offering digital discounts and vouchers is a delicate issue and one that clients regularly come to us with. In the past, luxury and premium brands erred towards being more conservative online. Of course, they want to cultivate customer loyalty and embrace new shopping and spending behaviour, but many have spent decades building up a feeling of exclusivity around their brands, and many marketers and brand managers naturally fear that they may undermine the brand, if a 10% off discount is splashed across every vouchercode site the web, and rightly so, this sort of deal would not echo their brand values at all. However, a recent survey by ShopperCentric revealed that 59% of shoppers believe premium brands that never offer discounts are out of touch with customers and that more than a third of consumers believe that brands who don’t offer discounts “don’t care about their shoppers”. This is not something that any brand aspires to, whether from the value or the premium end of the market.

This debate centres on the fact that the digital ecosystem has changed our behaviour and attitude to shopping forever. In times gone by, people had a limited number of places on their local high street to check before they made purchases and sales happened on twice a year in-line with the change of the seasons. However online, there are seemingly endless sales, discounts, price comparison sites and countless other tools available for consumers to research purchases extensively. How can higher-end brands compete with this demand for discounts and increasingly low prices?

Yet, while many brands feared this would spark a ‘race to the bottom’ in terms of price, where the lowest priced item would win the customer every time no matter who was selling it, what we’re actually seeing is that people have ‘go to’ brands or stores online. These can range from their favourite brands’ websites to shopping portals and from loyalty platforms to style blogs that link directly to retailers that sell the featured pieces.

With this in mind premium brands should not think of offering discounts as something that will damage their brand, but rather think creatively about ways to reward loyal shoppers and continue to create that air of being part of an exclusive club online. This can be much more effective that a broad-brush 10% off voucher in driving revenue as it will be targeted at individuals who have spent on luxury items in the past or are identified as having the propensity to spend given their previous shopping behaviour. In the same survey, ShopperCentric reported that three-quarters of shoppers “love” finding premium brands on offer. This strong, positive emotional response is something that is invaluable to brands looking to foster loyalty as well as drive sales. One of the best ways to do this for premium brands is tie discounts and rewards in closely with personalisation. Creating a memorable shopping experience that’s fun, incentivised and personalised by appealing to the individual with tailored messages makes customers feel valued.

Personalisation and partnerships are the key for premium brands who want to be in touch with new shopping behaviour but also want to maintain their luxury feel in the digital environment.

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