NEW YORK — The most fashionable, the least loyal.
This story first appeared in the December 18, 2002 issue of WWD. Subscribe Today.
It’s a conflict that spells a substantial challenge for apparel marketers, because branding and loyalty need to go hand in hand if an apparel label is to thrive in the long run, according to marketers. That’s because, as NPDFashionworld co-president Marshal Cohen noted: “There are simply too many options for today’s fashion customer — it is overwhelming.” As a result, when a brand maintains consistent standards of value and fit, those attributes form a firm foundation for developing loyalty, he said.
Achieving brand loyalty may seem like a shopworn strategy that has lost relevance with the proliferation of brands since the Seventies, and with recent surveys of consumers who cite the diminished importance they’re attaching to apparel labels. But loyalty measures, in fact, remain immensely important: They are leading indicators — usually heading north or south between 12 and 18 months ahead of a label’s sales and profit trends, according to Robert Passikoff, president and founder of Brand Keys, a market researcher specializing in loyalty.
“Loyal fashion customers don’t want to be surprised,” Cohen advised. “They want to be comfortable and take pride in what they buy.” That’s why, sources said, a perceived value and consistent fit are crucial components of allegiance to an apparel brand.
The loyalty challenge is an intriguing one, as a fashion label’s success also rests, in large part, on its ability to serve up fresh looks season after season. If apparel brands are to excel in today’s hyper-competitive market, it is incumbent upon them to strike a balance between maintaining consistent styles and fit standards while offering new colors and fabrics in a particular season, all under the umbrella of value. “The consumer is starting to say, ‘I can’t change my wardrobe every year,’” Cohen related.
Clearly, the household budget is one influence on that attitude, particularly as consumers’ craving for value continues to grow, while the country’s economy sputters along. Then there’s the “I” word: image. As apparel is an ego-intensive item, said Passikoff, “there’s a melding of how a person looks [in a garment] and their perception of that brand’s image. People are loyal to labels that make them feel good. They are not loyal to designers because of special sales promotions.”
Indeed, “how I look,” ranked first among traits given by 16,000 male and female adult respondents to Brand Keys’ semiannual Customer Loyalty Index, who were asked in the third quarter what instills loyalty to apparel brands. “How I look” drew an affirmative answer from 37 percent of those polled. It was followed by “brand image,” which drew a positive response from 30 percent of those surveyed, and “range of products,” 21 percent. Curiously, “value” ranked fourth, prompting a thumbs-up from only 12 percent of the nationally representative sample, and standing in sharp contrast to NPD’s finding that it has become the leading driver of loyalty to apparel labels.
“Value has become the number one influence over faithfulness to fashion brands, and it has been creeping up in importance over the past three years,” Cohen claimed. “The adult market became familiar with buying value-priced items for kids, and it eventually trickled through to their purchases for themselves.”
Most recently, value was ranked as the primary influence on loyalty by adults and teens in NPD’s Brand Focus study in October of women’s and girls’ casual sportswear labels, comprising a sample of 4,100 people, ages 13 and older. While value rated tops with those under, at and above age 18, additional attributes were ranked differently by the two groups. Among adults, value was followed by quality, image, fit and consistency in driving loyalty to apparel labels, with fit rising in importance along with the age of respondents. The teens placed image second, as one might expect, followed by quality, consistency and fit.
The power of value in the loyalty equation can be found, for instance, in the Lands’ End ratings in NPD’s Brand Focus, in which upper-income adults, or those with annual household incomes of $75,000-and-up, ranked it second, among 120 casual sportswear brands, for fit and best selection, but only 12th for intent to purchase, because of a perceived lack of value. That is, it was considered relatively pricey, and thus viewed as a less frequent, investment-dressing purchase.
Casual sportswear brands that engender the most faithful following, among the women polled by NPD, included Ralph Lauren, Liz Claiborne, Jones New York, Ann Taylor, Victoria’s Secret, Gap, Old Navy, Coldwater Creek, J. Jill, and Croft & Barrow. Victoria’s Secret, Gap and Old Navy also were among the casual sportswear brands inspiring the most allegiance among girls 13-7, as were Express, Abercrombie & Fitch, Aeropostale, Roxy, Mudd, LEI, and American Eagle Outfitters.
Complicating matters for fashion marketers cultivating loyalty, apparel brands are more difficult to differentiate because they’re easy to knock off. This, in turn, has bred an affinity for mass-market versions, which have acquired a cachet of their own, from Mossimo and Todd Oldham at Target to the Bisou Bisou line of sportswear anticipated at J.C. Penney Co. stores in February. And it’s the differentiation of a brand that leads to customer satisfaction, and subsequently sets the stage for loyalty to develop, noted Dr. Claes Fornell, the University of Michigan’s Donald C. Cook professor of business administration and researcher of the school’s annual American Customer Satisfaction Index.
Adding to the problem, said Shawn Parr, chief executive officer of ad agency Bulldog Drummond, is marketers’ frequent loss of focus on their brand’s identity, because a brand’s size and distribution do matter, and their dogged pursuit can diminish a label’s resonance. “American business has grown stale, as so many companies struggle to achieve a certain size,” Parr contended. “Loyalty is all about expanding both distribution and consumer awareness,” he added, citing Kate Spade and Mossimo as examples of brands he believes have done so successfully in recent years.
In an environment where apparel brands are bountiful and differentiation is largely a blur, satisfaction ultimately rests on integrating a brand’s image, product and purchasing experience, observers said. Sometimes, the marketing is the least of it. “We did some work for Ellen Tracy, a brand that has loyal careerwear customers, and we were amazed at how little the marketing had to do with the customer’s loyalty,” allowed Jonah Disend, president of strategic consultant Redscout. “Specifically, they said Cindy Crawford was the ‘wrong model’ for the brand, which they liked mostly because of its fit and quality.”
One mine buried in the fields of customer satisfaction and loyalty is price. While on the surface, a declining price for a brand appears to be an attractive selling point, over the long-term, it can be deadly for a fashion label.
“Traditionally, customer satisfaction does not come from price,” observed the University of Michigan’s Fornell. “That is why we are in such a dangerous zone right now — in the last three quarters we’ve seen price have a bigger effect on customer satisfaction with various products, including apparel.
“If it’s about price rather than quality, [brands] will cut operating costs, lay off employees and get caught in a deflationary spiral,” Fornell added. “Apparel companies have little pricing power, and when you couple this with consumer debt levels, it’s an explosive scenario.”