US: DSW Reinvents the Loyalty Experience

We’ve been documenting the ongoing revolution in retail, in which retailers launch and relaunch loyalty programs, redefine the in-store experience, and in some cases experiment with innovative, mold-breaking concepts. As retailers attempt to navigate a landscape now dominated by Amazon and a few other behemoths, it’s important to remember that customer loyalty can ultimately only be earned holistically. That is, a loyalty program alone – no matter how rewarding – is insufficient to turn the tide. Building real relationships with best customers requires a unified “loyalty experience” that includes in-store, mobile, brand, and marketing efforts that fulfill your brand promise, as well as recognize and reward customers across every touch point. As a case study, consider shoe and apparel retailer DSW, which recently announced an ambitious redefinition of its experience delivery with loyalty as the centerpiece.

By Wise Marketer staff

Branded footwear and accessories retailer DSW Inc. recently announced a new brand mission, supported by key strategic initiatives focused on building engaging customer experiences, distorting traditional assortment, enabling associate product knowledge and improving operational execution. DSW is beginning by enriching its assortment efforts, working to grow offerings and exclusive products. An extremely successful kids shoe test has led to an aggressive add of this category to more warehouses.

This mission also comes alive in an idea DSW calls “music for your feet.” It features initiatives which create emotional, inspiring experiences for customers, online and in-store. Recent examples include this summer’s mobile March On tour and concert series tie-in, and events like this fall’s in-store pop-up parties.

The company is blurring the lines between the online and in-store experience in a number of ways, too, beginning with the use of its physical locations as warehouses for the shipping and receiving of digital demand and returns. To continue offering a compelling physical experience, some of those “warehouses” will return to their roots with a new design. Incorporating future-focused innovative elements, the new look embraces the aesthetic of a warehouse, featuring pallet fixtures and flexible roller conveyors. The new store layout allows DSW to tell curated product stories across the floor, starting the moment the customer enters the space and begins their shopping journey.

Money quote from DSW CEO Roger Rawlins:

“At DSW, we see an opportunity to acquire market share as the retail industry consolidates. We have reinvigorated and positioned DSW to benefit, beginning with a new brand mission: We inspire self-expression. We’re unlocking the power of the warehouse with a synchronized and efficient infrastructure that virtually connects with the customer at every point, making DSW the place to find any shoe. It’s why we like to call our locations ‘warehouses,’ because more than half of our digital orders are fulfilled in-store, as opposed to in a traditional fulfillment center.”

The design is currently in test phase in DSW’s Polaris “lab” location just north of Columbus, Ohio, and the company plans to expand to several other locations in 2018. In addition, a new location on the Las Vegas strip, set to open in spring 2018, will showcase these new warehouse-inspired elements.

In addition, DSW is launching a totally new loyalty program in 2018, leveraging the brand’s 25 million-customer loyalty database. Also under evaluation are several exciting services like shoe rental, shoe repair and a philanthropic connection, offering a “non-commerce” experience to its most loyal customers.

DSW is also co-developing new proprietary store technology which will allow associates to connect with customers, facilitating their discovery and decision-making. Increased operational efficiency will free associates’ time and allow for more customer engagement. And the associate experience will be simplified by narrowing their need to juggle several electronic devices to one simple, streamlined tablet.

Money quote #2 from DSW Chief Operating Officer Michele Love”

“Today’s customer craves more than just a transaction, they want an experience. Our new program will be loyalty tailored to the customer’s level of engagement. It will go beyond points, and tie back to our mission of inspiring self-expression. [Our new store] technology enables shopping on the customer’s terms. We know they’re walking in with their mobile device in-hand. They want the sales associate to guide them on their journey. [It] will not only put customer-facing data like personalized offers, wish lists and purchase history in the palm of associates’ hands… it will [also] empower them with valuable information to enhance the shopping experience.”

That’s the textbook definition of a holistic loyalty experience. We’ll be excited to watch DSW develop the concept.

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