Luxury Retail and Digital Management, 2nd Edition

Chapter 10The Importance of Stores for Building Customer Relationships

So many designers forget that the customers are, in the end, the VIPs.

–Paul Smith

Luxury brands have a challenging task: retaining customers in a highly competitive sector. Most available studies show that about 20% of customers generate 65% of a brand's revenue (see Table 6.1 in Chapter 6). This means that a brand has to find ways and means to build a loyal customer base. Retaining customers and converting new customers into loyal clients are crucial for a brand. We have also seen (in Chapter 5) that customers' baskets are fuller when online customers subsequently buy offline. The store is therefore the stage on which everything plays out. That is where the brand encounters its customers. That is where relationships are born. That is where the customer journey, as complex as it is, materialises.

Two aspects, which we will analyse one by one, are essential here:

• Managing a store is a profession in itself and requires specialised skills and tools. We describe most of them and provide exhaustive tools regarding job descriptions, recruitment, salaries and career development in Part IV.
• Long-term customer relationships should be established by focusing on the development of personalised service (a subject we will cover in Chapter 12).

Why Sales Staff Need to Know Everything About the Brand

Example

September 2008, at the Paul Smith boutique in Paris. It is an extraordinary place, reflecting the philosophy ...