How did Farfetch Leverage Network Effects to Become One of the Leading E-commerce Platforms for Luxury Fashion?
Is Net-a-Porter’s Loyalty Programme the Ultimate Luxury Secret?
Personalisation and fashion-forward shopping experience that keeps customers coming back for more
In the realm of online luxury fashion, Net-a-Porter and Mr Porter stand out as the power couple of high-end e-commerce. Founded in 2000 by Natalie Massenet, Net-a-Porter is a trailblazer in luxury online shopping, offering an extensive range of women’s fashion, while Mr Porter, established in 2011, caters to the discerning gentlemen. Despite targeting different markets, both share a common goal – to provide superior service and curated collections for fashion-savvy individuals. Beyond their unparalleled selection of designer items, however, it’s also their commitment to rewarding loyal customers with an elevated invite-only rewards programme that upgrades their shopping experience.
Net-a-Porter Rewards
Net-a-Porter alongside Mr Porter initially launched their EIP (Extremely Important Person) loyalty program in 2017; this highly elusive membership was reserved for the platform’s highly private and even higher-spending clientele. The EIP status was designed to redefine a customer’s luxury shopping experience, and much of the details of the program was largely unknown. However, in June of 2023, commerce platform introduced ‘Net-a-Porter Rewards’, a tiered system implemented across both Net-a-Porter and Mr. Porter designed to extend its membership options and open the doors to attract new loyal customers.
“If you think about it, our whole industry has thrived on exclusivity and a sense of mystery…Some of that still holds solid today, but some of that is changing, and what is important is this idea of transparency and opening access a little bit.” – Alison Loehnis, CEO of Net-a-Porter
Commencing with level Silver, the Rewards programme works its way up through Gold, to Platinum and finally the infamous EIP level, that still aims to provide customers with the ultimate luxury shopping experience. At each stage members required spending increases, with the final level demanding at least £10,000 to be spent onsite each year.
So, how do you keep track of it? Once spending has reached or exceeded £2,500 customers are automatically enrolled into the Silver tier, and progression into Gold and Platinum will follow provided you meet the spending requests. The site encourages its users to keep up to date on their ‘progress’ via its Net-a-Porter Rewards Hub.
When a customer nears the threshold of EIP, a specialized member of the Net-a-Porter retail team contacts them, introducing the enticing possibilities and benefits of this exclusive community. Once a customer has achieved this, with £10,000 spent on-site in a single year, a letter will arrive extending a warm 15% off their first order and acquainting them with their own personal shopper. The EIP package includes a handbook detailing the exclusive privileges, a physical card bearing the member's full name along with their personal shopper's contact details, and an initial call to understand the member’s fashion needs and preferences. Communication primarily happens through WhatsApp, the preferred channel, unless the member otherwise specifies.
Member Benefits
The benefits vary by tier, with birthday rewards and discounts available at Silver level, and a steady increase in personalisation and access up to EIP.
The top tier, which Net-A-Porter enticingly dangles to customers on its Rewards FAQ page is nothing short of extraordinary. It offers worldwide free shipping, with same-day service in London, NYC, and Hong Kong, setting new standards for e-commerce convenience. The personal shopping service provides EIP members with a dedicated personal shopper, readily available to locate sought-after pieces, secure sold-out items, and offer invaluable size and fit advice. Members gain access to new product arrivals a staggering 36 hours ahead of others – which is exceedingly helpful for those highly coveted designer products. Invitations to private sales, held bi-annually, precede the crowd, adding exclusivity to their shopping journey. The programme’s perks go beyond fashion, offering emotional benefits such as exclusive event invitations, like the Hampton’s cocktail party, hosted in partnership with Ralph Lauren, that featured the brand's new collection and a skincare masterclass led by Dr. Barbara Sturm.
Luxury fashion retailers, like Farfetch, Selfridges and Matches are increasingly aware of the importance of rewarding their top-paying, loyal customers. Net-a-Porter and Mr Porter's dedication to rewarding its clients is a testament to the industry realisation that personalised and exclusive shopping services reap substantial rewards. Customers in this category tend to be up to 50% more engaged with the retailer or platform and while this experience is undeniably limited to a select few, these clients contribute significantly to overall company success.
While they make up only a single-digit percentage of the customer base, as reports suggest, Net-a-Porter Rewards customers, especially its EIPs, drive around one-third of the total sales.
To meet the rising demand for personalised luxury shopping experiences, in 2020, Net-a-Porter announced an ambitious expansion plan for its luxury division, adding over 100 personal shopping and client relations professionals in key global locations. This move stands as a clear indication of the platform’s commitment to prioritise, satisfy, and retain its most discerning clients.
Exclusivity
In tiered loyalty programmes, companies seize a prime opportunity to encourage increased spending. By implementing a spending threshold at each level, customers advance with every purchase, gradually edging closer to a new tier and the promise of its associated perks. This form of loyalty scheme is favored by companies aiming to maintain an air of exclusivity, a tactic frequently employed by airline companies.
Net-A-Porter's EIP only loyalty programme added an intriguing and enigmatic dimension to the platform. However, its high level of exclusivity made it appear inaccessible to a broader customer base. Significant spenders who weren't EIPs received seemingly no rewards, and there was minimal incentive for those willing to spend more. The new Reward tier system maintains this allure of exclusivity but provides customers with a taste of the benefits to come, undeniably reinforcing their desire to reach new tier levels. Net-a-Porter carefully utilises selective jargon throughout the site and its descriptions of the tiered benefits are deliberately elusive and demand further explanation, phrases like ‘Shipping Rewards’ and ‘Birthday Reward’. This strategy places non-members on the outside, fueling curiosity and the desire to explore further and ultimately… spend more.
Personalisation
Undoubtedly, shopping can be stressful, and deciding where and how to spend your money can be overwhelming. Personal shoppers eliminate the paradox of choice, transforming the shopping experience into a smoother and more enjoyable process. Net-a-Porter Rewards offers customers a personalized shopping experience, a privilege sought after by those at lower tiers and enjoyed by EIPs.
The connection between the personal shopper and the EIP client transcends the transactional – it often evolves into a genuine friendship and, in some instances, is reportedly akin to a family bond. From the very first conversation with an EIP and their personal shopper, the emphasis is on understanding the individual at a personal level. Each interaction enriches a buyer’s profile, building a detailed picture of one’s taste preferences and shopping history. With this wealth of information, the offerings and experiences are meticulously customised to match one’s past purchases and interests. EIP members who might have an interest in fine jewellery and watches could receive an invitation to visit the brand's factory, an opportunity to witness the craftsmanship first-hand and the artistry of its construction. On birthdays, members of all tiers receive birthday rewards and top clients are often sent flowers as a thoughtful surprise. These highly targeted and personal experiences foster a deep emotional connection between the brand and its customers, increasing the likelihood that they'll share their remarkable journey with others, and as a consequence boost the Rewards reputation and reach.
Customer Service & Care
The success of Net-a-Porter’s Rewards programme stems from a dedication to the service and care of customers. It's all about forming one-on-one relationships that are as caring as they are exclusive.
Platinum and EIP’s receive priority customer care, placing their needs above other tiers and customers. Furthermore, EIP’s can pick and choose their desired items, from existing collections or unreleased previews, all of which are expertly assembled by their dedicated personal shopper. No need for EIPs to log into their Net-a-Porter online account; they can communicate their purchase via WhatsApp to their personal shopper, who handles the transaction for them. Moreover, for those in London, NYC, or Hong Kong, your personal shopper will liaise with the Net-a-Porter Premier team, ensuring same-day delivery and handing over the purchase in a neatly packed shopping bag. It's a hassle-free shopping experience at its finest.
An exclusive 'try before you buy' service has also been known to await EIP members. This allows customers to order multiple pieces, try them in the comfort of their own homes, and only pay for the items they decide to keep. This not only adds convenience and variety to the experience, benefiting the customer, but also encourages larger order volumes, benefiting Net-a-Porter. The dedication of personal shoppers knows no bounds. From tracking down incredibly rare products to orchestrating last-minute hand deliveries from across the globe, they go above and beyond for their clients. It's not just a transaction – it's a genuine connection that can transform into an extended network.
Final Take-Aways
Loyalty programmes are vital for brands seeking sustainable success, but finding new and exciting ways to retain and intrigue customers is a challenge. Net-a-Porter has masterfully met this challenge through its Rewards programme, effectively redefining the luxury shopping experience to maintain customer engagement and loyalty. Introduction of tiered levels effectively entices nonmembers and existing members to spend more in the hope of reaching top tier status. Ultimately, the quality of relationships, exceptional benefits and standard of customer care, paired with the enticement for customers to work their way up the tiers sets the Net-a-Porter Rewards loyalty programme apart from competitors and will undoubtedly drive the platform’s future growth.
