How to Build Long-Term Loyalty in Australian Retail

The Australian retail scene in 2025 is a complex tapestry of economic shifts, evolving consumer behaviors, and fierce competition - making customer loyalty a pivotal factor for long-term success.

A whopping 79% of businesses are revamping loyalty strategies for 2025 to stay ahead of the pack. In response to diminishing customer sentiment, there is an increasing need to invest in them. With inflation tightening wallets and eCommerce giants like Amazon shaking things up, Aussie retailers are in a fierce battle for A-T-T-E-N-T-I-O-N. Shoppers now crave genuine value, transparency, and personalized experiences, making it crucial for brands to stand out.

In this exclusive pre-event Q&A interview, meet Jessica Skinner, Director of Ecommerce and Marketing, Global, at FRANKIE4. With over 15 years of experience and a remit spanning all digital touchpoints and brand ownership, Jessica knows a thing or two about keeping customers hooked.

From leveraging social media to crafting simple yet powerful loyalty programs, her insights will help you turn casual shoppers into lifelong fans. With a strategic approach and a strong brand voice, find out how you can drive higher ROIs and cultivate true brand advocates in the dynamic Australian retail market of 2025!

Uncovering the Key Drivers of Customer Loyalty in Australia

What are the primary factors currently driving customer loyalty in Australia? How have recent economic conditions impacted these priorities?

In Australia, customer loyalty is increasingly shaped by a desire for authenticity and transparency, as consumers grow more selective about which brands they trust. With rising living costs impacting discretionary spending, today’s customers prioritise genuine value and clarity in brand communications. They expect loyalty programs to offer straightforward, meaningful rewards without complex, tiered structures or delayed benefits.

This is demonstrated through young consumer’s rising interest in loyalty programs. According to the Australian Loyalty Association, 67% of Gen Z and 64% of millennials find these programs valuable, especially in sectors like beauty and fashion. While this cohort is highly engaged, staying relevant is key to sustaining their loyalty. Moreover, this cohort tends to be less data sensitive and willing to make the value exchange to benefit from rewards. Overall, this trend indicates a promising openness to loyalty programs in emerging customer groups.

How can brands deepen emotional connections with Australian customers to foster long-term loyalty?

Building deep, emotional connections with Australian customers requires a tailored approach, shaped by the brand’s industry and target audience. For us, identifying and catering to niche groups was key to our success. Professionals like educators and healthcare workers, who spend long hours on their feet, naturally gravitate towards our brand. We nurture this connection by offering exclusive discounts, personalised promotions, and considering their needs in our design process. There is no one size fits all approach to this. Brands must think about the truest purpose of their product and the community it attracts and iterate directly with that group.

Beyond this, many brands overlook the power of social media for engaging existing customers. Beyond acquisition, social media platforms serve as vital channels for ongoing communication, feedback collection, and brand updates. There are effective, simple, and free levers you can pull to foster ongoing engagement with your community, such as Instagram Broadcast channels and feedback-focused Facebook posts or closed Facebook groups. We utilise this as a fully circular feedback cycle with our customers, which in turn creates a sense of community, and consequently, loyalty.

Adapting Loyalty Programs for Economic Challenges

How should loyalty programs adapt in the current Australian economic climate to remain both relevant and cost-effective? Are there any specific loyalty incentives or strategies that you find particularly resonant with Australian customers during economic downturns?

Launching a loyalty platform can involve substantial overhead costs. A key consideration in point-based or discount-driven systems is the liability they introduce, which needs thorough scenario testing. In the current economic environment, leveraging a robust ESP with integrated CRM capabilities that seamlessly connects to your e-commerce platform can provide significant value without extensive additional investment.

The interior design of a FRANKIE4 retail store

It’s crucial to avoid excessive use of discounts in owned channel communications; instead, focus on offering incentives that align with your business goals. Effective strategies include birthday rewards (date of birth is a highly valuable data point), review incentives (helping us achieve milestones like 120,000+ five-star reviews), and sign-up discounts (with tight expiration to create urgency). These initiatives can serve as a simplified loyalty program tailored to your needs.

Additionally, we regularly conduct data gap closure campaigns, where we invite customers to update missing information in their profiles for a chance to win a FRANKIE4 gift card. This practice has proven highly effective and is particularly beneficial before major cross-channel promotions.

FRANKIE4 Gift Card

For brands just starting out, my top recommendation is to choose an ESP that offers affordable SMS credits and integrates directly with your ecommerce platform. SMS is an extremely powerful channel for us, especially when used sparingly and personalised for maximum impact.

Harnessing Digital Tools to Boost Customer Loyalty

What digital tools and technologies can be used to effectively build loyalty and advocacy among Australian customers? How do you approach balancing automation with a personal touch to maintain customer loyalty?

Many retailers tend to overcomplicate their loyalty platforms. For D2C brands, with a straightforward ERP, there are numerous straightforward solutions that don’t require hefty investment. If you’re not ready to implement a full-fledged loyalty program, starting with a robust ESP and starting with some simple automations is the best way to go. Investing in either of these tools will provide a far better ROI than paid advertising.

In my opinion, Yotpo stands out as a comprehensive tool for customer engagement and loyalty, especially for brands that generate substantial UGC. Its capabilities in review collection, loyalty rewards, and referral programs make it a valuable asset for driving repeat business and building advocacy.

Personalising automations can be streamlined with a tool like Klaviyo, which integrates seamlessly with Shopify. To achieve this, start by ensuring your tags are configured correctly in Klaviyo, then set up tailored, behaviour-based flows. Examples include browse and cart abandonment flows based on product type, post-purchase care guides customised by product range, and lapsed-customer flows that anticipate potential future purchases. If you have physical stores, segmenting by location and purchase history can be highly effective for driving in-store visits. Adding a personal touch, such as a note from the store manager or exclusive invitations to events, can make customers feel valued and connected.

FRANKIE4’s innovative Sole Saver Pack ® offering a personalised fit

How can brands leverage data analytics to optimize their loyalty programs?

To optimise loyalty programs effectively, brands must begin by defining the key metric they aim to influence. This foundational step shapes the entire program design and requires clear data insights. Brands need to pinpoint the specific behaviours they want to encourage or discourage. For instance, if the goal is to shift Average Order Frequency (AOF) from one to two purchases annually, the program should heavily incentivise customers to ascend into higher tiers.

A strong data foundation enables brands to track program success. At a minimum, businesses should monitor key metrics such as gross sales, gross profit, transaction volumes, units per transaction (UPT), average order value (AOV), churn rate, returning customer rate, AOF, customer lifetime value (CLTV), and customer acquisition cost (CAC). Reviewing how these metrics have evolved over the years and aligning them with overarching business objectives is essential for determining program impact.

Customer cohort analysis is also vital. By examining which customer segments already align with the proposed program tiers, brands can evaluate the program's liability and criticality. This approach ensures loyalty efforts are targeted and meaningful, providing a strategic framework for success while minimising risks and maximising long-term impact.

Enhancing Customer Experience to Drive Loyalty

Which areas of the customer experience should Australian brands focus on to drive loyalty without significantly increasing costs? And how can brands encourage repeat purchases and long-term loyalty without relying heavily on discounts?

The solution seems simple but is challenging in practice: create a brand that’s in high demand. Australian brands should focus on strategic product releases that build anticipation and excitement. This could include early access launches, social media hype campaigns, or collaborations with relevant creators. Coordinating these efforts with your inventory team is essential; understanding your AOV and AOF will help dictate the optimal drop cycle and marketing strategy.

Strategic brand partnerships also play a significant role in driving loyalty and repeat purchases. Collaborating with aligned partners for competitions or joint marketing efforts can boost awareness and generate demand. Such partnerships not only increase visibility but also lend credibility to your brand, often acting as a stepping stone to larger, high-impact collaborations.

Instead of relying heavily on discounts, focus on adding value in other ways. Consider limited edition releases or offering gifts with purchase (potentially from your brand partnerships). Additionally, highlight the perceived value of your product by addressing the specific problem it solves. If your brand is positioned at a premium price point, it’s crucial to effectively communicate why it’s worth the investment. Showcasing the quality, unique features, and the friction points your product alleviates will help justify the higher price, fostering both loyalty and repeat purchases.

Can you address how retailers can deliver exceptional customer experiences?

To drive customer loyalty without significantly increasing costs, Australian brands should focus on the fundamentals. Getting the product, inventory, and target audience right is essential and doesn’t require additional investment. By honing in on these basics, brands can naturally encourage repeat purchases.

Loyalty is tied closely to competition—brands need to ask what unique value they offer. For example, at FRANKIE4, our unique value is delivering the most comfortable women’s shoes on the market without sacrificing style. We design with both comfort and style holding equal weight. This blend is what sets us apart and builds customer loyalty.

Another key to an exceptional customer experience is reliability. Offer realistic and achievable shipping options and follow through on promises. When customers feel their needs are met on time, it fosters trust and loyalty. Retention and loyalty are not all about a tiered or rewards program, it’s about the holistic customer experience. If shipping has taken a fortnight longer than a customer anticipated, it’s unlikely they will shop with you again, even if it means they’ll transcend tier status.
Beyond the basics, a memorable unboxing experience can leave a lasting impression. Thoughtful touches in packaging, like the famous Tim Tam in Adore Beauty’s orders, can make a brand memorable. In today’s content-driven economy, these small, tangible details resonate with customers and create organic marketing moments.

Conclusion

What is your #1 advice for brands looking to build and sustain customer loyalty?

My #1 advice for brands looking to build and sustain customer loyalty is to invest in your brand team. Loyalty starts with how your brand is perceived, and a strong brand team can cultivate an identity that resonates deeply with customers. When a brand team is equipped with the right resources, it can craft compelling stories, create memorable experiences, and communicate values that align with your customers’ beliefs. This emotional connection builds a foundation for loyalty that goes beyond transactional interactions.

Driving demand for your brand through a well-defined brand narrative and consistent engagement is one of the most effective loyalty tools. A strong brand team can execute campaigns that reinforce your brand’s message across multiple channels, ensuring that customers feel a sense of belonging and trust. Moreover, as your brand identity strengthens, customers are more likely to advocate for it within their networks, turning loyal customers into brand ambassadors. Prioritising brand-building through a dedicated team is a long-term investment that pays off in customer retention and sustained growth.

Hear from Jessica Skinner, at Sheraton Grand Sydney Hyde Park, Australia on 26th February, 4:40PM: Closing Leadership Panel: How to use brand and leadership as a key lever to attract and retain talent – Who are you and what can you bring to the table for your employees? Find out more here!