Leatherman on Why Premium Products Need Loyalty Programs
Loyalty programs have become ubiquitous, creating a crowded marketplace. Given this landscape, how can a brand introduce its loyalty solution and differentiate itself?
The answer often lies in the uniqueness and demand of the product or service you’ve crafted. That’s a sentiment Leatherman is leaning into.
In an interview with PYMNTS, Hannah Harper, digital marketing manager at Leatherman, explains the company’s focus on loyalty and how this boosts the company and attracts consumers looking for rewards on products that aren’t typically bought frequently.
“Like lots of brands, we are constantly looking for more ways to surprise and delight our customers. And so, we’re looking at what things we can do to make that better. Offering a rewards program just made sense for us,” Harper said.
Loyalty and Durable Products
Infrequently purchased products, such as appliances, electronics or tools, often come with a substantial upfront cost. Loyalty programs for these products can motivate consumers to choose a specific brand or company for their next purchase. By offering rewards or discounts to returning customers, businesses can create loyalty even in industries with long buying cycles.
Imagine purchasing a premium smartphone with a loyalty program that promises a substantial discount on your next upgrade. Not only does this ensure that you’ll return to the same brand for your next phone, but it also reduces the financial burden of staying up-to-date with the latest technology.
“For us, it was more about, how do we continue to strengthen that one-to-one relationship and offering more personal experiences,” Harper said.
Harper said Leatherman caters to a diverse range of customers. Among them are devoted fans who acquire each new product release, earning the moniker of “everyday collectors.”
“We also have a lot of customers that buy one or two for themselves. But then they become active gift-givers for the brand, and Leatherman really becomes their go-to gift,” Harper said.
Leatherman’s findings resonate with the views shared by Ranjeet Bhosale, vice president of customer marketing and operations at The Home Depot, during an interview with PYMNTS earlier this year where he discussed the Atlanta-based home improvement retailer’s tiered benefits program.
“If you look at any successful loyalty programs, there are two types of benefits that you can give to your customers,” Bhosale told PYMNTS. “One type are the typical transactional benefits where you give perks and rewards, which are great to get the customers engaged with Home Depot, but they only drive transactional loyalty. Where we need to take the loyalty program, and what we are excited about, is to have the right balance of not just transactional benefits, but experiential benefits.”
Read more: Home Depot Nails Experiential Loyalty to Keep Big-Spending Pros Returning
In light of this, it’s crucial to recognize that today’s consumers are seeking greater benefits from their memberships, desiring added value, and frequently anticipating rewards that extend beyond their purchases.
How Leatherman Loyalty Brings Value
Harper said the program features three tiers, and those who sign up are referred to as “insiders.” The Leatherman Insider Rewards Program’s three tiers are Select Insiders, Premier Insiders, and Elite Insiders. As participants progress through these tiers, they unlock new benefits and experiences.
Harper explained that once a customer becomes a program member, they unlock advantages beyond the reach of nonmembers. These perks include free standard shipping, with the minimum purchase requirements adjusting according to the member’s tier. For tier 1, it’s $40, for tier 2 and 3, there is no minimum.
Members also get free 30-day hassle-free returns. Yet the feature that sets the experience apart is the 40-year extended warranty, according to the company an enhancement of Leatherman’s initial 25-year warranty.
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