Brand-loyalty bonds made today among young HENRYs will keep the male fashion customer coming back as their careers lead them into Ultra-Affluence
Sometimes, but all too rarely, you happen upon a new retailing concept that grabs you. It is the perfect combination of the right product at the right price for the right customer — delivered with the right shopping experience. That is how international men’s retailer Suitsupply got my attention. With six US stores and seven more slated to open soon to make 46 stores worldwide, Suitsupply sells high-quality, well-designed men’s suits at affordable, even reasonable prices, with off-the-rack suits starting under $500 and made-to-measure up to $2,000.
Besides the great clothes, Suitsupply provides exceptional service, which includes highly-trained sales associates that take the guesswork out of the equation by fitting a customer into the suit that works best for him; and on-site tailors who do basic alterations while you wait — all for the thrill of immediate gratification.
But it’s not just the clothes and shopping experience that sets Suitsupply apart. Suitsupply’s marketing strategy makes it an important retailer; everyone needs to take notice, and not just those in the fashion business. Suitsupply is a retailing concept that is designed to grow and evolve with its core customer base. Suitsupply knows its customer – young, ambitious professional men – and his needs today, but is positioned to meet those needs in the future, as he advances in his profession and his ability to trade up. It’s the affordable front door to a bespoke haberdashery experience that today’s young and less affluent HENRY (high-earners-not-rich-yet) customers will ultimately grow into.
Get Inspired: Meet the young HENRYs who will grow into ultra-affluence
In today’s affluent market, defined as the top 20% of US households based on income that starts at about $100,000, there are only two income segments that really matter. The HENRYs with incomes between $100,000 and $249,999 (which comprise about 22 million US households); and the ultra-affluents, roughly the top 2%, or slightly fewer than three million households with incomes of $250,000+. HENRYs are the mass affluent who are a critically important shopping segment across all retail; and the ultra 2% is the luxury-market target, although far fewer in number, has two-to-three times the spending power as HENRYs
While not all HENRYs will reach ultra-affluence, most ultra-affluents start out as HENRYs. The upwardly mobile HENRYs are just the kind of customers that Suitsupply cultivates: highly-educated, young professional men who need to dress for success in their management, law, finance, consulting, and other careers and occasions when a suit is appropriate. It is these young men with advanced degrees and ambitious career goals who are most likely to advance into income levels over $250,000 and thus become the prime target customer for true luxury brands.
So why wouldn’t they want to upgrade their dress-for-success wardrobes to more exclusive brands, like Ermenegildo Zegna or Kiton, when they have the incomes? Very simply, shoppers are creatures of habit, and unless they are given a compelling reason to change their shopping habits, they are highly likely to continue going back year after year to the brands that have served them well in the past.
Unless Suitsupply really screws up, which given their laser focus on their customers and satisfying their fashion needs, their young HENRY customers are bound to stay in for the long haul as their incomes rise and ability to spend increases.
Take Action: Develop a strategy for future retail success by understanding your best customers today and tomorrow
No matter what your retail brand or your position in the market, high-end, low-end or in the middle, the best prospects for growth can be found among the affluent, those at the top 20%. Post-recession, with so much spending power drained out of the middle-class market, the affluents are about the only ones with any significant discretionary income left.
Unfortunately, too many marketers misunderstand the affluent and think of them as people looking to spend their money just as quickly as they can make it, splurging on high-ticket luxury brands and other indulgences. But people don’t get rich by spending all their money, nor do they reach affluent income levels by accident. “They work hard for the money,” paraphrasing what Donna Summer sang back in the 80s.
Affluents know the value of a dollar and they tend not to spend it carelessly or unwisely. They also have stable lifestyles and personal responsibilities that they take seriously. They typically aren’t spendthrifts and usually don’t live beyond their means. All the same, their higher levels of income make them the ‘heavy-lifting’ shopper who can boost the average ticket in any retail store simply by their greater ability to spend.
That is why I see Suitsupply as a sustainable brand with this powerful target market – young men with ambition and incomes destined to rise year-over-year with a need for professional suiting and appreciation for high levels of service. The brand’s future is virtually guaranteed because Suitsupply has ticked off all the most important boxes to succeed.
Identifying the customer: Young men on road to affluence who need professional suiting
Defining what he needs: Fine quality suiting at reasonable price today with offerings that can grow with his ability to pay in the future
Delivering a WOW factor that will hook him and keep him coming back: Service levels that exceed what he would expect and probably has ever experienced. By providing instant alterations, Suitsupply builds a level of trust and loyalty that will bring him back again and again.
Other retailers can learn much from the Suitsupply example. They need to go beyond customer demographics that simply describe who the customer is today, and factor in lifestage and psychographics, which reveal why people buy. Simply put, the demographics that describe the customer – their age and income – change with time, while the psychographics or why they buy is a fairly stable measure over time. By understanding why your customer buys, you can create a retail offering and shopping experience that can evolve over time as the demographics of the customer base shifts. Too many retailers get stuck focused on one demographic segment, Think Abercrombie and Fitch. Brands must keep reinventing themselves to attract new customers that fit that narrow segment, all the while losing valuable customers as they age out beyond that demographic slice.
Other retailers have a much broader understanding of why their customer buys – such as Suitsupply, plus Brooks Brothers, J. Crew and Gap in the fashion realm — and use those insights to create a platform to attract the right customer for today and tomorrow who will grow along with the brand. Plus a retailer in it for the long haul must back up the psychographically-driven marketing strategy with shopping experiences that truly knock the socks off the competition, like a Suitsupply (or Nordstrom and Zappos) and so many small, independent retailers where exemplary service is demonstrated day-in, day-out. Suitsupply, although niche, is a model for any smart retailer to create a sustainable model that builds lifestyle, values and attitudes into the mix, today and tomorrow.