Through a special arrangement, presented here for discussion is a summary of a current article from the rDialogue blog.
Since the Great Recession, consumers have turned to outlets to shop the brands they love at prices they can afford, demanding more value. Determining the right way for retailers to leverage this channel without cannibalizing its broader business begs the question: How should loyalty programs fit in this space? Should it be the same value proposition the flagship stores offer?
We think there is a lot of opportunity for a loyalty presence in this space, with certain factors taken into consideration:
A stand out in this channel is J.Crew. It is one of the few retailers with dedicated outlet e-commerce and has just launched a tender neutral, outlet-only program called Factory First. It's right on brand and offers great soft benefits tailored to outlet shoppers — early access to new arrivals, free shipping periods, exclusive deals, and outfit ideas for adults and children (through Crewcuts).
With 40 percent of Americans visiting at least one outlet mall in a given year and outlet shoppers spending up to 79 percent more per visit at outlets than regional malls, we expect to see other retailers follow J.Crew's lead as this channel becomes increasingly profitable.
What do you think of the opportunity for loyalty programs specifically for outlet stores?