Shipping Protection: Why It’s Essential to a Successful Premium Fashion Ecommerce Strategy

Fashion retailers that rise to premium or luxury status share a handful of characteristics: exclusivity, high quality, personalized customer service, and online shopping experiences that anticipate every need.

It can take years of A/B testing and processing feedback to create an ecommerce customer experience worthy of a premium fashion brand. But there’s one tactic of this experience you can implement right away: shipping protection.

Shipping protection is a safeguard against the financial fallout of package loss, theft, or damage during transit. And while all fashion brands can benefit from it, shipping protection is especially important for brands hoping to achieve an elite status.

It’s especially important because it intersects with other key tactics of a premium fashion ecommerce strategy. Keep reading to learn more about those key tactics, why you need them, and how shipping protection gives you a competitive edge.

Tactic #1: Make ethical fashion a priority

Ethical fashion involves more than manufacturing clothing with sustainable materials. The movement also seeks to protect factory employees and minimize environmental harm as products ship to the marketplace. And its market share is growing among luxury customers.

In 2023, market research firm Savanta studied the wealthiest consumers in the United States and learned that 47% of those surveyed ”would deem a brand’s social responsibility important when it comes to making a purchase decision.” In an even bigger warning to brands, “22% [of these consumers] have already boycotted a brand or product for its poor ethical or sustainability values.”

A growing share of this ethically minded, luxury customer base is young Gen Z shoppers. In a 2024 study of the luxury market cited by Fashion Dive, 40% of those surveyed had made at least one “luxury style purchase” over the past year. Of those, 63% were Gen Z consumers.

And almost half of Gen Z shoppers are willing to pay more for ethically or sustainably produced fashion. Vividata surveyed Gen Z consumers in Canada and learned that 44% of them “are willing to pay more for sustainable clothing, despite [their] having lower average personal incomes than any other generation.”

Outdoor fashion brand Patagonia is working hard to cater to these consumer preferences. They’ve made ethical fashion a key pillar of their brand identity. One of their key ethical initiatives — selling gently used clothing — gets a stand-alone site. 

Is their strategy working? According to the company’s founder, Patagonia has an estimated value of about $3 billion dollars and brings in $100 million in revenue annually. Plus their sales have “quadrupled in the last decade to hit more than $1 billion annually.”

Ethical fashion has higher costs

If you want to add an ethical fashion line to your inventory, you’ll face higher cost of goods for one or more of these reasons:

• Higher wages for production workers lead to higher price tags.
• Suppose you want to apply for a Global Organic Textile Standard (GOTS) certification. GOTS certifies that every element of the clothing manufacturing process, including the fabric dyes used, aligns with their standards of organic production. The cost of certifying a single production facility can be up to 3,000 euros.
• Sustainable production methods like low-impact dyeing and fabric recycling can be more resource-intensive than conventional practices.
• Eco-friendly materials like organic cotton and recycled polyester are more expensive than conventional fabrics.

Sure, luxury online shoppers won’t balk at higher prices. But if one of them claims a $1,000 dress arrived torn or didn’t arrive at all, you may have to eat the cost of a replacement. You’ll likely retain the customer but suffer a substantial hit to your total revenue.

But say the customer purchased shipping protection from Extend along with the dress. You, the merchant, would be compensated for the replacement dress if the customer’s claim was approved. 

With shipping protection, you can offer ethically produced, high-end fashion items with more confidence knowing that your customers can add protection from common delivery issues.

Tactic #2: Offer “white glove” customer service

Luxury consumers expect “white glove” customer service, even when shopping at your online store. And it only takes one bad experience for them to take their business elsewhere.

According to a 2024 Hiver survey, “72% of customers switch companies after a negative experience.” The same study shows that 36% of surveyed customers who have a bad experience will take to social media or review sites to vent their frustration. 

Poor reviews on social media platforms are damaging to any brand. But arguably they’re more damaging to premium brands, which partially rely on a spotless reputation to defend their high price points.

Premium brands like Ralph Lauren try to reduce the risk of negative customer experiences by making sure the customer gets what they want from the outset. Their My Style quiz helps customers match their preferences to specific fashion products.

But if the item still doesn’t meet customer expectations, Ralph Lauren offers free returns, and they even give customers the convenience of texting an agent for assistance.

Customers who purchase shipping protection from Extend to safeguard their high-end items experience this same degree of white-glove service. Customers can file claims as easily as logging in to the Extend portal with their email address, answering a few questions, and receiving a claim decision in seconds.

Tactic #3: Protect against fraudulent return claims

Because premium and luxury goods have higher price tags, fraudsters frequently target them. Fraud at this level includes the manufacture of counterfeit products, as well as false claims of package theft or damage to collect the cash value of the item.

Fraud is one of the biggest threats to a luxury brand's bottom line. It can cost billions, and it’s difficult to combat. Top fashion brands like Dior and others have resorted to using blockchain to track items from production to sale. Their new consortium called Aura seeks to give customers the confidence that they’re buying authentic luxury items.

Counterfeiting aside, another common fraud type is buying items from online retailers, falsely claiming damage during shipping, and demanding a replacement. Extend can mitigate this and other types of fraud. Here’s how:

• Extend leverages a proprietary, dynamic fraud detection model that includes a robust data validation process to recognize fake names, email addresses, and phone numbers.
• Claim verifications often involve sending photographs of the item’s damage. If the fraudster uses images pulled from Google in their claim filings, Extend can flag them.
• If Extend’s fraud detection system can’t definitively determine whether a claim is fraudulent, it quickly triages it for manual review.

Tactic #4: Add experiences to your loyalty program

Some heads of premium apparel brands shy away from loyalty programs because they believe such programs “cheapen” the brand’s image. This perception stems from many programs’ offer of discounts to customers who earn a certain number of points.

Loyalty expert Zsuzsa Kecsmar of Antavo writes that luxury brands’ loyalty programs don’t need points or discounts to attract and retain potential customers. “Instead of focusing your program solely on points,” she argues, “experiment with a system based on behavior, such as a tier system.”

A tier system can reward loyal customers based on their buying behavior, touting greater rewards for higher levels of annual spending. Kecsmar further argues that luxury fashion loyalty program rewards “must focus on unforgettable experiences.”

Neiman Marcus’ InCircle loyalty program awards points for dollars spent. But members can redeem those points on free two-day shipping, gift packaging, and a concierge that arranges travel itineraries and restaurant reservations. Access to the concierge requires at least a $5,000 annual spend. 

Neiman Marcus teases additional benefits — which it smartly doesn’t name to add to the allure — for customers who annually spend $75,000 and more.

A valuable benefit that many premium and luxury fashion brands leave out of their loyalty programs is shipping protection. Here’s why you should include it:

• Loyalty program members get peace of mind knowing you have their backs if high-end products suffer transit damage, are lost, or get stolen from their doorsteps.
• Members credit your brand with the elite customer support they receive when filing a claim. You’ve just boosted your brand’s reputation and opened the door to positive customer reviews.
• For the consumer, shipping protection costs a fraction of an item’s retail price, so it’s not difficult to absorb. 

Shipping protection is a benefit with a much bigger payoff than the cost to implement it.

Enhance your premium fashion ecommerce strategy with shipping protection from Extend

Premium ecommerce fashion brands might worry that adding a service like shipping protection will disrupt their site aesthetic. In reality, the option to add shipping protection integrates seamlessly with your online point of sale and your aesthetic. Customers can purchase it in one click. 

But given the value it brings to your well-heeled target audience, you might want to promote it more heavily. Extend gives you all the assets you need to raise shipping protection’s profile in a manner that aligns with your unique marketing strategies.

Read more about the benefits of Extend Shipping Protection here.