When it comes to giving customers a reason to stay loyal, there aren’t many apparel retailers who offer something better than Urban Outfitters Rewards. As a “lifestyle retailer dedicated to inspiring customers through a unique combination of product, creativity and cultural understanding”, Urban Outfitters offers perks and benefits that are as appealing to shoppers as their mission statement.
Of course, these perks aren’t just for the benefit of the average shopper—UO Rewards also helps this well-established retailer keep operating costs down and customer lifetime value up. Urban Outfitters is doing an excellent job of giving brand loyalists a truly VIP experience while offsetting the financial pain of things like returns processing.
In this article, you’ll see all the amazing things Urban Outfitters and UO Rewards are getting right so you can start incorporating some of these smart practices into your business.
There are many things that make UO Rewards an appealing program for retail shoppers.
As retail programs go, signing up for Urban Outfitters Rewards couldn’t be easier—simply enter an email address, a phone number, and a style preference, that’s it. There is no fee to join, no minimum spend requirement tied to membership, and there are multiple reward tiers for VIP shoppers to distinguish themselves from everyday loyalists.
Urban Outfitters makes it virtually effortless for shoppers to earn rewards points. From purchasing products to subscribing to their email list to enabling push notifications, there’s just no shortage of ways for shoppers to earn points. In fact, there are more than a dozen different options for adding points to your rewards account.
Unlike more cumbersome and complicated rewards programs, Urban Outfitters goes to great strides to ensure its shoppers can activate their rewards with the greatest of ease. In addition to receiving a $5 off coupon automatically for every 100 points earned, all loyalty members get:
Members who achieve Silver (200 points) or Gold (300 points) status also get access to monthly gift-card drawings, special shipping offers, bonus points, and more.
Once earned, all of these perks are added directly to a loyalty member’s account making their activation and redemption a seamless experience requiring little to no effort on behalf of the customer.
Of course, what’s really important to understand isn’t how shoppers benefit from Urban Outfitters Rewards, but how the brand itself benefits from its own rewards program.
Online returns are on the rise. In fact, the value of returned merchandise will total more than a quarter of a trillion dollars this year. Retailers who run loyalty programs that offer free returns get killed on both processing/restocking costs and shipping costs.
Urban Outfitters avoids this by refusing to incorporate end-to-end free returns into its loyalty program. Instead, UO Rewards asks that all shoppers help pick up the bill when it comes to returns by charging a $5 restocking fee. This nominal fee allows Urban Outfitters to recoup the costs associated with not only restocking, but loss-of-value too (e.g., if an item is returned out of season).
(To learn more about why retailers shouldn’t be afraid of scrapping free returns click here.)
Just about every aspect of Urban Outfitter Rewards—from the sign-up process, to the earning and application of points, to notifications about special sales and new products— is automated, which means running the program on a day-to-day basis comes with minimal overhead.
Unlike other more service-oriented rewards programs, Urban Outfitter rewards doesn’t require the same number of customer-service representatives to support.
Like any rewards programs, Urban Outfitters Rewards tiers its loyalty program. Beyond the entry-level membership, it offers Silver and Gold tiers of loyalty which are difficult to reach (though not impossible) without making multiple purchases within a calendar year.
Adding the tiers transforms a loyalty membership from a simple quid pro quo exchange into something of a social status symbol that shoppers covet. Because the upper echelon of membership in Urban Outfitters Rewards is unattainable without making multiple purchases, the company cultivates additional sales by giving customers an aspirational goal to achieve (i.e., becoming a Gold Member).
Naturally, becoming a Gold Member is more than a status symbol—it comes with tangible advantages including:
Urban Outfitters Rewards incentivizes shoppers to do a number of things that benefit its bottom line.
Getting shoppers to leave reviews with greater volume and frequency comes with a number of benefits, not the least of which is additional credibility and social proof for Urban Outfitters products (which encourages other shoppers to click “buy”).
More reviews also help Urban Outfitters better understand what their buyers like and don’t like about the shopping experience, making it easier to improve everything from their product detail pages to their customer service process.
Long term, these optimizations lead to fewer returns, lower churn, and increased lifetime value.
Like reviews, consumer-driven product photos give shoppers additional perspective on a given product’s look, feel, and function. The more complete a given shopper’s understanding of a product prior to purchase, the less likely that shopper is to submit a return—a big-time benefit for retailers (lower operating costs and higher revenue retention).
Convincing customers to receive push notifications is a win for the simple fact it makes it easier for retailers to connect with shoppers in real-time about new products, sales, promotions, special events, pop-ups, and more. At-scale, this leads to increased brand awareness, brand engagement, and revenue.
Though it may seem frivolous, incentivizing digital shoppers to browse a retailer’s website or app is akin to getting brick and mortar shoppers to step off the sidewalk and into a storefront. It is a behavior that’s proven to fuel an uptick in incremental purchases which boost revenue and lifetime value.
There are few forms of marketing as effective as email marketing. Therefore, getting shoppers to opt-in to a mailing list can be worth its weight in gold for a savvy retailer.
Like push notification subscribers, members of a retailer email list are more likely to be aware of (and engage with) special sales and seasonal promotions, boosting revenue.
By incentivizing participation in UO Rewards, Urban Outfitters not only cultivates customer loyalty, but they also build a treasure trove of purchase and return data they can use to boost sales, reduce churn, and further optimize their business as a whole.
Remember, no loyalty program is perfect—there’s always something to do better. But if you’re looking for a great brand to model your rewards off of, copycatting all the little things Urban Outfitters Rewards does is a smart place to start.
Currently the Senior Content Marketing Manager at Narvar, helping 1300+ of the world's most-admired brands—including Sephora, Levi's, and L'Oréal—take their post-purchase experiences to new heights. Born and raised in San Francisco, but I've lived all over the world. Previous residences include Seattle, Denver, Santa Monica, Kinsale (Ireland), and Wellington (New Zealand). Writer by trade, football player by passion, and tall by genetic lottery.