May, 2011 – This Luxury Daily article discusses some retailers eliminating shipping fees to be responsive to their customers (http://www.luxurydaily.com/gilt-groupe-responds-to-customer-concern-via-return-and-shipping-tweaks/).
By Rachel Lamb
Flash-sale site Gilt Groupe is tweaking its customer service policies to better reach the needs of buyers by offering incentives such as reduced shipping fees and more efficient return policies.
The company noted via email yesterday that the main reason for this change was because the customers asked for it. The move may also be a recation to pressure brought on by other retailers offering shipping for online purchases.
“It is very important to listen and to act in a way that is responsive to the customer,†said Ron Kurtz, president of American Affluence Research Center, Atlanta. “Both [lower shipping fees and return policies] are important in making it easier and more convenient for customers to do business with them.â€
Gilt Groupe did not respond by press deadline.
Mr. Kurtz is not affiliated with Gilt Groupe, but agreed to comment as a third-party expert.
Gilty pleasure
Gilt Groupe sent an email to customers from CEO/founder Kevin Ryan explaining the changes.
Shipping fees now are only $5.95 for UPS ground shipping despite the size of the package.
Gilt is making more items including handbags, wallets, sunglasses, ties, belts, cufflinks and jewelry eligible for return.
Furthermore, customers will now receive a full return upon return.
Customers can choose whether they want to accept the refund minus the shipping charge, or no shipping fee and opt for Gilt credit.
Finally, unsatisfied customers can make returns via United States Postal Service and can return via home, office, mailbox or drop-off location.
In addition to the email, Gilt has posted the new changes on its Web site.
“Given the basic appeals of the flash-sale business, i.e. saving money and securing good value, Gilt’s customers may be particularly sensitive to [these changes],†Mr. Kurtz said.
Don’t discount shipping
Customer service has always been a huge part of the luxury industry.
Because consumers are paying such high prices for goods, they expect something in return such as free shipping or a gift upon purchase.
Many luxury retailers offer free shipping or, at least, discounted rates
Also, since luxury consumers are more inclined to start spending again (see story), extra incentives such as free shipping and easier return policies may further coerce them.
Luxury companies will not know what will make their customers happy unless they ask.
According to Gilt’s email, it asked and received customer feedback so that the company could get a better idea of what would make them happier.
More importantly, Gilt followed through.
Other luxury retailers are encouraging customers to come forward with feedback.
For instance, apparel and accessories designer Diane von Furstenberg maintained the brand’s trademark customer interaction by encouraging feedback during its Web site relaunch (see story).
“It is important to continually watch for opportunities to make changes that provide a better level of service and contribute to recognition as being customer sensitive,†Mr. Kurtz said.