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The weekly dispatch: Bath & Body Works joins the fight for loyalty, TikTok explores localization

illustration of a person standing at a laptop computer next to a large monitor showing a beauty product and a loyalty card.

The retail marketplace is a competitive environment, and more brands are starting to feel the pinch of the so-called ‘loyalty shock’. But the way that retailers are responding to this puzzle speaks volumes about their long-term strategies for success.

From fresh loyalty programs to entirely new revenue streams, brands are pulling out all the stops to build repeat business and set themselves up for better market share. Find out all about this and more in this edition of the weekly dispatch:

Gap launches supply chain solutions for e-commerce brands

Gap Inc. has officially announced GPS Platform services, an omnichannel fulfillment and reverse logistics service for both D2C and B2B brands.1

With 13 distribution centers totaling more than 9 million square feet, Gap’s logistics network is well-placed to meet customer expectations for next-day delivery services ahead of peak season.

Gap is not the first retail brand to venture into the world of logistics management. American Eagle purchased Quiet Logistics in 2021 in an effort to shore itself up against ongoing supply chain challenges, recently launching a nationwide delivery network.2 Walmart is also seeing steady growth with its GoLocal delivery, which is putting the retailer on a direct path to competing with Amazon.

By leveraging their own expertise and infrastructure to offer these services to private e-commerce sellers, retailers are bringing in a lucrative revenue stream while setting themselves up for a long-term pivot within an overcrowded e-commerce marketplace.

TikTok dives into local content with new features

It might be one of the most popular platforms around, but TikTok is continuing to innovate and explore new tools to keep its users engaged. The video platform recently began testing a ‘nearby’ feed designed to serve up local content, and the ability for users to add location tags to their videos.3

Currently only available to a select group of users in Southeast Asia, the localization feature echoes efforts made by platforms including Instagram and Snapchat to reshape themselves as discovery tools. Possible developments if the feature is rolled out further include allowing users to find restaurant reviews, sightseeing recommendations, and ads from local businesses

By moving towards organizing content by location in addition to popularity, TikTok is allowing for more regional variation in the videos that users consume. This echoes a wider move toward the localization of content, product offerings, and even promotional offerings by brands in order to build customer loyalty in an increasingly competitive marketplace. 

Bath & Body Works launches nationwide rewards program

After months of testing in select markets, Bath & Body Works has launched its new loyalty program nationwide.4

The My Bath & Body Works Rewards program allows customers to unlock exclusive events and offers, sneak peeks, a birthday gift, and even free full-size products. 

MarketsandMarkets forecasts that the global loyalty management market size will grow from $8.6 billion in 2021 to $18.2 billion in 2026.5 So, it comes as no surprise that this globally recognized American retail brand has entered the competitive world of loyalty programs.  

The company continues to invest in the customer experience, and early results show that members of the loyalty program have consistently higher spend and retention than non-members.6 According to the Capgemini Digital Transformation Institute, “86% of consumers with high emotional engagement say they always think of the brands they are loyal to when they need something, and 82% always buy the brand when they need something.”7

If building brand loyalty and improving customer retention are the goals, revamping a customer loyalty program or creating one from scratch, as seen with Bath & Body Works, can produce that personalized buying experience consumers are searching for; allowing that emotional connection to a brand to develop and flourish. 

Levi’s embraces the power of AI

Levi Strauss & Co. will soon begin using AI (Artificial Intelligence) technology to improve its fulfillment of e-commerce orders.8

The in-house invention dubbed BOOST (Business Optimization Of Shipping and Transport) is an engine that utilizes a combination of data-driven technology and machinery designed to examine the order and conduct a precise analysis on the most cost-effective and efficient ways to process as it relates to labor, packing, and shipping.

“What BOOST is optimized to do is fulfill ecommerce orders more effectively,” said Louis DiCesari, Global Head of Data, Analytics, and AI at LS&Co. in a statement. “When somebody goes online to make a purchase, we have distribution centers where we keep inventory specifically for those orders.”9 Currently, this BOOST technology is processing about 40% of current e-commerce orders and the goal is to fulfill 100% by Black Friday of this year.

Artificial Intelligence is becoming a hot commodity these days, as this highly advanced technology allows for not only more personalized experiences for the customer, but also proves to be a powerful tool in optimizing every aspect of an e-commerce business for greater efficiency. According to recent research by NewVantage Partners, 99% of leading businesses are currently investing in AI. 96% also say their efforts are already yielding results.10

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