Servicing Luxury: The Psychology Behind VIP Customer Treatments

Luxury brands can enhance high-end consumer retention and enhance brand identity with effective VIP treatments.

Since the beginning of time, exclusivity has held significant appeal in the business landscape across diverse sectors, from hospitality to retail.

Denoting limited access or availability, companies leverage the notion to attract customers and enhance revenue by capitalising on its association with luxury, prestige, and status that many aspire to attain.

Psychological drivers behind exclusivity encompass the human desire for uniqueness, status, and belonging. Being part of an exclusive circle or owning rare products fosters identity and pride while reflecting success and accomplishment.

Social and cultural dynamics further amplify the allure of exclusivity as a symbol of individual achievement, spurred on by media portrayal of an aspirational lifestyle restricted to a select few. The fear of missing out (FOMO) amplifies the appeal of exclusivity, inciting participation in exclusive experiences or communities.

Exclusivity can also reshape consumer behaviour by introducing urgency and scarcity. This step can expedite purchasing decisions. Meanwhile, some would also introduce exclusive memberships or experiences to foster loyalty and advocacy, engendering a sense of pride and community.

Practical application

The power of exclusivity extends far beyond mere marketing strategy. It is part of human psychology, and grasping a level of comprehension on how to maximise this can ultimately reshape consumer experiences and preferences.

Industries like events hospitality, fashion, gambling, and travel leverage exclusivity to attract high-end customers. VIP hotel rooms offer tailored services and luxury features, limited-edition fashion collections create urgency and desire, high rollers receive exclusive perks upon login to VIP casinos, and luxury travel packages offer personalised experiences and access to unique destinations.

Once a brand has established its footing among high-end customers, maintaining a strong brand legacy and embracing exclusivity is key to appealing to consumers’ desire for uniqueness and trust.  Brands can leverage these principles through various strategies.

The first is to highlight brand legacy: Even new brands can emphasise craftsmanship and product stories to showcase their legacy. Utilise product detail pages and optimise Google Ads with legacy messaging.

Utilising exclusivity scarcity is a trick that never gets old. Leverage exclusivity scarcity in marketing and messaging. Offer privileges to members, such as first previews, personalised products, and member-only access to boost brand engagement and purchase intentions.

In the gambling industry, it is common for online casinos to introduce special rewards or tournaments only for their VIP members. Despite their limited entry, these programs and their perks are made known to all players. This serves as an advertisement as well so that regular users know the benefits of such membership.

You can also play it subtly and embrace discreet luxury. Recognize the shift towards discreet luxuries, such as the modern days where consumers seek to signal status through sustainability. Showcase efforts towards sustainability, provide ethical scores, and partner with organisations that align with eco-friendly values.

Hotels usually flaunt this by offering guests to reuse their towels, limiting their amenities although allowing guests to request additions for free, and some would have detailed descriptions of their waste management within the guest books. In addition, it has become more common for companies to publish ESG (Environmental, Social, and Governance) reports annually, including fashion and iGaming companies.

Loyalty schemes can be handy as well, although they might not be as effective as they were before. Many retailers are shifting towards tiered loyalty schemes that reward customers based on spending tiers, aiming to retain existing clientele in the face of rising customer acquisition costs.

Unlike traditional one-for-all loyalty schemes, tiered schemes offer different benefits to customers based on their spending levels. The tiered structure appeals to the psychology of competition and exclusivity, and it can even foster a sense of competition as customers race towards the highest tier to show their loyalty.