Loyalty That Comes at a Price

Western Mail (Cardiff, Wales), February 16, 2004 | Go to article overview

Loyalty That Comes at a Price


Byline: Matthew Gunther Bushell

This week, I tip my hat to Essex boy Peter Loobey. This modern day shoppers' Che Guevara has been so incensed by the onslaught of till-side requests for loyalty cards that he has taken to manufacturing T-shirts bearing an offensive anti-loyalty card slogan.

Whilst Peter might be in the minority - more than 85% of households in the UK now have at least one loyalty card say market researchers TNS - it would appear our patience more than our loyalty is currently being tested.

In 2003, a study by strategy consultants Cims found that only 35% of shoppers believed enough was being done by supermarkets operating high profile loyalty schemes to adequately reward customers.

Research by NOP found 67% of shoppers visit a store based on convenience, regardless of any loyalty scheme.

Research last month by industry think-tank IGD found only 8% of shoppers would change stores to take advantage of a loyalty card, but 58% would happily change shopping habits for lower prices.

In a nutshell, we're not loyal to our loyalty cards, but we are loyal to price and convenience - so why do the supermarkets bother with these schemes?

The traditional answer is data capture. In a market which in the UK is worth pounds 65bn a year, if you can increase market share by even a few percentage points, through whatever gimmick, your turnover can end up matching the GDP of a small African nation. …

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