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How the wealthy rank CRM and loyalty leaders

American Express is the company wealthy consumers rated as the best in terms of Customer Information and Customer Loyalty best practices, according to the ‘Enhancing the Customer Experience of the Wealthy 2006’ best business practices survey from the Luxury Institute.

The survey also examined wealthy consumers’ attitudes toward customer relationship management (CRM) best practices, with Nordstrom being ranked first (followed by American Express). For the survey, 597 high net worth consumers were asked to name up to three luxury goods or services firms that they believed represented the best practitioners in terms of their customer information, customer relationship management, and customer loyalty practices. The responses were unprompted, and company names were nominated strictly by respondents.

Customer information winners
The top five best practitioners (in order) for customer information were:

  1. American Express;
  2. Nordstrom;
  3. Tiffany;
  4. Neiman Marcus;
  5. Lexus.

CRM winners
The five best companies (in order) for CRM best practices were:

  1. Nordstrom;
  2. American Express;
  3. Lexus;
  4. Ritz-Carlton;
  5. Tiffany.

Customer loyalty winners
The top five best practitioners (in order) for customer loyalty programmes were:

  1. American Express;
  2. American Airlines;
  3. Hilton;
  4. Marriott;
  5. Starwood.

Luxury loyalty must improve
Most of the loyalty programmes that wealthy consumers think are best practitioners are, with the exception of American Express, from non-luxury goods and services categories. This suggests that the luxury industry has much progress yet to make, as loyalty is just as critical in the luxury market as it is in more mainstream markets.

According to Milton Pedraza, CEO for the Luxury Institute, “Many experts and insiders give awards for best practices but, while those are important, we wanted to give America’s high net worth consumers – people who actually experience these practices and vote with their wallets – the final say as to which practices are really best, and which brands are best practitioners.”

In peers they trust
Pedraza warns that luxury marketers must begin to realise that today’s luxury branding market is “more like The People’s Choice Awards than the Academy Awards.” He added, “The wealthy in particular trust in peer brand reviews far more than any other sources, and luxury executives should follow the customers’ lead.”

The survey included preferred interaction channels for specific activities and internet usage in the past 12 months. Respondents were aged 18+, with a minimum annual income of US$150,000 and a minimum net worth of US$750,000. The group’s median income was US$324,000, and median net worth was US$2 million.

More Info: 

http://www.luxuryinstitute.com

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