In the competitive landscape of luxury swimwear, PQ Swim stands out for its design engineering (aka… the perfect fit!), signature lace and macramé bikinis, and exceptional craftsmanship. As the brand approached its 13-year anniversary, PQ Swim engaged Compass + Nail (C+N) to understand its Brand Equity and identify the unique potential within the brand.
C+N founder Craig Wilson, a notable expert in consumer behavior, states, “One of the most challenging things for a brand leader today is knowing how to invest time and money amidst competing opportunities. The tsunami of data and analytics we all have at our fingertips has blurred the landscape, making it essential to be rooted in the phenomenon of fandom. It’s the only thing that drives sustainable, profitable growth. It’s about cultivating deep, lasting relationships with customers who advocate on behalf of your brand.”
The 4-step process was simple: First, quantify the current value within the brand; next, understand their core customer; third, create the ideal user experience that serves the customer uniquely; and finally, measure the efficacy of ongoing efforts to create loyalty.
Step 1: Quantifying PQ Swim’s Brand Equity
The starting point for any brand, before embarking on the strategic imperative of creating a loyal customer following, is to understand brand equity, the value that currently resides within the brand. At the heart of C+N’s approach is the Brand Equity Index (BEI™), which quantifies the performance of an entire company’s efforts to create true brand loyalty. The algorithm and software application, developed by C+N (patent pending), measures a company’s ability to efficiently create brand advocates, scoring the brand against financial and consumer behavior benchmarks, while simultaneously pinpointing profit potential.
As Kate Nowlan, president of PQ Swim explains: “The BEI™ identified for us that our most loyal customers were highly valuable, in fact, 11x more profitable than a first-time customer, justifying that an investment in acquiring new customers could provide a very healthy return. The BEI™ also identified, however, that we didn’t have enough of those ‘marquee customers,’ and that attrition after the first purchase was too high.”
Now that PQ knew where they stood, they could focus their efforts in the right way to scale their business, profitably.
Step 2: Understanding the Core Customer
C+N conducted an in-depth research study of PQ’s core customer, utilizing behavioral science to get to the root of how they think, what they value, the principles they operate their lives by, and why PQ Swim’s brand, products, and service levels resonated with them.
“Through the research, we gained perceptive insights about the unique value within our brand that resonated the most with our core customers,” states Nowlan. “We learned the idiosyncrasies in both product use and buying behavior that became the means by which we could engage with our customers on a deeper level, increasing loyalty without having to resort to discounts or gimmicks to get them to come back.”
Step 3: Building the User Experience to Serve the PQ Swim Customer, Uniquely
With these insights as a foundation, C+N created the Loyalty Architecture for PQ Swim, starting with their Customer Activation Cycle, which defines the attributes and goals of their customers at each stage of the brand/consumer relationship, enabling them to create distinct engagement strategies for each segment, from Prospect to Cheerleader.
Craig Wilson, the creator of the C+N framework, emphasizes the foundational philosophy behind the approach: “Customer Loyalty Architecture provides a comprehensive definition of the company, its relationship with the customer, and the stories, experiences, and communications that foster the relationship. This is the architecture for communicating your brand’s unique core value and purpose, identifying its reason for being.”
Nowlan added: “Our brand has transformed into the ultimate expression of Amber’s (PQ Swim’s founder’s) intentions and vision. Through the work with C+N, we gained a deeper understanding of the values and principles shared by our core customers. One of the insights we pulled from the customer research was that PQ helped them realize their idealized vision without taking themselves too seriously. So we captured unique photography, unconventional scenes, and playful, candid moments. These dynamic compositions and natural interactions showcase our swimwear in fresh, unexpected ways, emphasizing the vibrant spirit of the brand.”
Image provided by PQ Swim.
Step 4: Measuring the Results
Four months after the completion of the project, PQ Swim is experiencing strong double-digit growth in all wholesale segments and significant growth in its DTC channel. Migration of customers from first purchase to second has increased 29%, and their most loyal customer segment, those shopping 4+ times, has increased 30%. Success is now quantified by the Brand Equity Index™.
As Nowlan notes, “The Compass + Nail work has informed every element of our business, from our merchandising strategy to our creative expression, user experience, service standards, and even how we operate as a team. We live by the Loyalty Architecture and the BEI™, which give us a holistic view of our business health.” This approach has enabled PQ Swim to track its progress uniquely.
In Summary: 4 Steps to Improving and Sustaining Brand Equity
- Quantify the current value within the brand: The Brand Equity Index™ offers brands a unique view of their business’s health. Get started here.
- Understand your core customer: Understanding how consumers interact with your brand is key to informing content, editorial, messaging, and user experience design to optimize performance.
- Create the ideal user experience that uniquely serves your customer: Brands looking to deepen their consumer connections should explore the C+N Loyalty Architecture framework and its applications. (Read the book.)
- Track the impact on performance: Share your monthly BEI™ score with the entire company, because retaining loyal customers is everyone’s job.
In summary, PQ Swim exemplifies how a thoughtful, data-driven approach to brand strategy can lead to success. By embracing the C+N Loyalty Architecture framework and utilizing the BEI™, PQ Swim has set its own benchmark for what it means to cultivate genuine brand loyalty.
Craig Wilson is the founder of Compass + Nail, a brand strategy and business consulting firm, and the architect of the Brand Equity Index™. To learn more, email hello@compassandnail.com. Kate Nowlan is the president of PQ Swim. For wholesale inquiries, contact anne@pqswim.com.
