back to article Loyalty card? Really? Why data-slurping store cards need a reboot

Loyalty cards – the little buggers are everywhere these days. When British supermarket chain Tesco launched its Clubcard back in 1995, it was a forward-looking idea, so much so that Lord Ian MacLaurin, then Tesco chairman, suggested that he knew more about his customers after three months than he did after 30 years in the retail …

Anonymous Coward

We know what you ate last Summer.

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"We know what you ate last Summer."

Polonium-210 doped salt fish?

spoiler alert

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Re: "We know what you ate last Summer."

I correct you

"We all Know what you spent last summer"

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It's dishonestly marketed

Customers are only clearly told of the "club points", the discounts but not the privacy busting tracking.

Any NFC version should only store a unique serial number.

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Devil

Quoth the App: "Hi Hannibal. Would you like a nice Chianti to go with those fava beans? We have some excellent ones on sale in aisle 4."

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Pint

"A mind is a terrible thing to waste. Download our Recipes app and learn 5 delicious ways to cook brains!"

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Just digging deeper here

This whole article filled with buzzwords and dripping with false solicitude is just explaining how Big Business is pushing for the next step : having a truly global view of our spending habits.

For now, Business is limited to a per-shop knowledge base, they want to go global. Of course, it is entirely for our sake (cough).

So, in future, look for not needing to sign up to a loyalty scheme anymore, it will come automatically integrated with your VISA or Master Card.

I'll bet Big Business is already frothing at the mouth with the idea of all that sweet, sweet marketing and profiling data it is going to get its hands on.

Because you know it's going to happen.

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Big Brother

Re: Just digging deeper here

I'd suggest it has already happened with things like Halifax Cashback Extras where your spending profile on the debit card at all merchants is used by the bank to target you with offers. For now it's opt in but I'm sure it's only a matter of time before that opt-in box is automatically ticked to borg the bloody lot of you "improve the customer experience".

I still don't see why they bother though. Nectar might only have one supermarket in it (the former Sainsbury's Reward card) but they have various other retailers so can pick up lots of data. I use mine only in JS and spend about £50/week, very occasionally spending £80 to refill the freezer, yet every week I get a voucher promising bonus points for spending more than £90. They know I almost never get anywhere close to that amount and must assume I sneak off to the other supermarket nearby to do another full shop. If they gave me a bonus for spending £60 I'd be able to use it most of the time while also subtly increasing my spend with them - i.e. it would be successful. Getting vouchers I definitely cannot use means I won't even try so it doesn't increase my loyalty which was surely the whole point in the first place.

TL;DR: Simply put after 20 years of harvesting and deep analysis of all this big data they still don't understand the data they have, and they definitely cannot put it to effective use to increase how much people spend with them (at least in my case).

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Anonymous Coward

Re: This whole article filled with buzzwords

Article? I thought my ad blocker stopped working.

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Re: Just digging deeper here

"I get a voucher promising bonus points for spending more than £90."

I get vouchers and they offer a 15% discount on my shopping. The spend to qualify has inched up to £60 from about £30 a few years ago so I don't use all the vouchers Sainsburys send. However when a new film comes out on Blu-Ray I'll get that (because they're £15 everywhere) £15 of groceries and £30 of wine.

All this and Nectar know in return: where I live and what I buy.

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Coat

Re: This whole article filled with buzzwords

Boo. I had "devops" on bullshit bingo and it never came up :-(

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Re: Just digging deeper here

"I'll bet Big Business is already frothing at the mouth with the idea of all that sweet, sweet marketing and profiling data it is going to get its hands on."

Why does it only hear what it wants to hear and not what it needs to hear? e.g. Slinging advertising at satisfaction surveys at me just pisses me off so don't try it."

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Re: This whole article filled with buzzwords

"Article? I thought my ad blocker stopped working."

I thought it was a sketch for a dystopian novel.

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Re: Just digging deeper here

"If they gave me a bonus for spending £60 I'd be able to use it most of the time while also subtly increasing my spend with them "

Morrisons used to be like that. Loyalty card not needed in this case, but whatever you spent, you'd get a voucher offering money off or card point if you spent about double the amount next time. I've noticed recently that the vouchers are now set at a much much lower target spend for "next shop", but also with smaller rewards. It does mean that I can use them sometime though, so that's a win for me and them,

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Devil

Re: Just digging deeper here @paulf

yet every week I get a voucher promising bonus points for spending more than £90.

You do realise that the average shopping is probably around the £80-£85 mark.. But by inducing gullible supplicants people to spend more offering rewards for purchasing just one or two extra items, they get you over that point which really is only just a little more than what you'd normally spend, and you get all those lovely rewards that almost cover half the cost of the extra you purchased!

And hey, if food goes off in your fridge because you're buying a little more than you need each week, who cares? They got your money, what you do with the food is your business.

I saw this often with a couple of fuel brands with my bike, the reward started at $20 and my bike took $18 of fuel. I approached them to see if they'd give motorcyclists a little leeway since most couldn't take that much fuel back then, but they wouldn't budge. I know a number of bikers who won't shop with that brand any more. When broke I've also taken a couple of retailers to task for trying to push "only an extra $5" on people. When broke or on a very tight budget, $5 is a hell of a lot!

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Re: Just digging deeper here

I usually spend between £10-£15 in Sainsburys when I go there, and get a voucher for extra points if I spend more than £30. I managed to use it once when I bought some one-off non food stuff, but otherwise, £30 of food in one go is going to mostly end up in the bin.

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Stop

Nope

No loyalty cards for me.

They can pay ME for access to my shopping habits, however I don't come cheap.

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Anonymous Coward

Re: Nope

Actually what they are doing is paying you for the information in the form of 'discounts'.

So what this means in effect is that they are penalising you for *not* giving them your information and so they are then operating a Two-Tier Discriminatory pricing regiime.

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Re: Nope

They are paying you - it's up to you to decide whether it is worth it.

I've had one-and-a-half free tvs and three free radios out of Nectar Card (as well as various smaller things, days out etc). To me that's acceptable.

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Anonymous Coward

Re: Nope

Done a good deal of my Crimble shopping with my Nectar points. Most of my spend was not in the store but on Petrol/Diesel. Yes I did a lot of miles for my job.

That and my Boots card are my only 'loyalty' cards.

Got in with some stuff from Homebase before they stop taking it on 31st Dec. I guess the new Aussie owners will be starting their own system in the new year?

The sad fact is that they send you tokens for say '7p per Litre off fuel' if you spend £20 on cleaning materials. They know full well that I'd just bought a load of Persil.

That's targetted marketing for you eh?

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Anonymous Coward

Re: Nope

"[...] my Boots card are my only 'loyalty' cards."

Boots Advantage scheme was a scam as far as I am concerned. They used to give over 60s a 10% cash discount on Boots own brand products. Then they announced an "improved" discount - no longer cash but points. However as their helpline shame-facedly admitted - the points were worth far less than the 10% cash had been.

Then they started refusing to give points for purchases of large boxes of branded medical products - because they stocked them on the pharmacy shelves. The far less economical smaller boxes were on normal shelves and did get points. The same applied to being able to use your points - the large boxes could not be paid for using points.

Their own brand products for generic things like aspirin turned out to be twice as expensive compared to the nearby independent small pharmacy.

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Re: Nope

I've had one-and-a-half free tvs and three free radios out of Nectar Card

I had half a TV once. I'm not saying it wasn't cheap but it was a bit shit all told and I don't think I would go for it again.

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Re: Nope

I had half a TV once. I'm not saying it wasn't cheap but it was a bit shit all told and I don't think I would go for it again.

Well, it probably wasn't the best TV on the market, but for the price it was unbeatable. Both TVs are still in use after 1 and 3 years (approximately) respectively, so they can't be that bad (or maybe my standards are just low).

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Re: Nope

"The sad fact is that they send you tokens for say '7p per Litre off fuel' if you spend £20 on cleaning materials. They know full well that I'd just bought a load of Persil.

That's targetted marketing for you eh?"

Probably. They hope you'll think it was generous of them so they must be really nice people and it's just a pity you won't be able to use them - which they already know and assume it'll cost them nothing.

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Re: Nope

No loyalty cards for me.

They can pay ME for access to my shopping habits, however I don't come cheap.

What do you think your bank, the credit card processors, and others who handle your transactions do with your data in aggregate?

Unless you operate with straight cash, the data points your generate are being sold to the highest bidders (every bidder, probably). Even with cash, your tab has a lot of data on it that will be used to give someone else a discount (hrm, lotion and tissues are often purchased together...)

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Coat

Re: Nope

I had half a TV once. I'm not saying it wasn't cheap but it was a bit shit all told

Was it the selection of programs?

- The One Ronnie

- Not The 4:30 News

- The 0.5 Show

And as for the film choices... The Magnificent 3.5 was a bit weak, and the less said about The Hateful Four, the better...

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MJI
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Re: Nope

The One Ronnie was an actual programme

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Re: Nope

I've had one-and-a-half free tvs and three free radios out of Nectar Card (as well as various smaller things, days out etc). To me that's acceptable.

But you didn't. This is the wonders of distraction or step-removal psychology.

Free is free, as in you got something genuinely for free. When you use a loyalty card or similar the fees for this, as in the perceived value of the loyalty rewards or points you are given come from somewhere. The subscribers, who are the stores not you, have to factor in the cost of these points and rewards and therefore have to either reduce their profit on your purchases or to absorb the costs and you can guess what happens here because the supposed gains from loyalty will rarely equal or exceed the costs of the scheme compared to the additional profit that they make from you through encouraging you to spend more with them. So what generally happens is the cost of the items for sale are slowly increased to cover the cost of the loyalty points or rewards while keeping the previous level of margin.

In the end the loyalty cards are adding to the cost of whatever's for sale (and this includes the "cash back credit cards which work similarly"). If you chose not to take part in the scheme but still buy the products or services that include this cost within it then in you are in fact funding the scheme for others. Many of these schemes would probably fail, or have to be significatly rebalanced, if everybody participated in the value that can be recovered from them.

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Re: Nope

"What do you think your bank, the credit card processors, and others who handle your transactions do with your data in aggregate?"

Not all that much to aggregate when you use mainly cash.

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Re: Nope

Not all that much to aggregate when you use mainly cash.
Not true, unless you believe that a store doesn't track all items in a purchase regardless of payment type. Not to mention all the metadata, such as store location, time of day, week, and month, etc. Even if you are using only cash, people with similar habits are going to be correlated with you, and your data will be aggregated with there own, if maybe given a little less weight because of the way in which it was matched.

And let's not forget that your bank knows who you are... and even if you are conducting most business in cash, they can still get back to you (or people like you) and offer up products, services, etc. that they think match your profile base on demographics. It might not be as personalized, perhaps... though even today most campaigns are pretty broad-brushed in their approach to "personalization."

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Amazon is way over the line into creepy but their recommendations are not what keeps me loyal. What keeps me loyal is the ease of use of the site and a feeling (not necessarily backed up by facts) that they are more secure than the smaller sites.

That said I have done extremely well out of Nectar points especially on double up events and cinema trips which I consider a fair exchange for knowing what I buy,

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Anonymous Coward

Amazon

Completely the opposite for me. I'd rather shop anywhere else, even if it involves paying a small premium. Amazon is definitely the last point of call when all else fails.

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Amazon's recommendations are way over the line into ludicrous. If that's the best that can be done we're safe for the moment.

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Anonymous Coward

Actually, apart from their perceived Evilness or otherwise, I buy so much stuff from Amazon that their recommendations are actually getting quite good these days.

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They have gotten worse for me over the years. For the last year they've been advertising Kindle titles to me in the Kindle app that's already holding those titles. So they're good at picking what I like if it 100% matches what I've already bought from them.

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Anonymous Coward

"I buy so much stuff from Amazon that their recommendations are actually getting quite good these days."

IIRC Amazon used to publish recommendation book lists compiled by other customers. These introduced me to a lot of relevant titles that were no longer in print but which could often be bought from online book sellers.

Ebay was amusing yesterday. They have a "people who bought this also buy" recommendation system. I bought a b&w school picture - which triggered recommendations for a list of old fashioned soft pr0n pictures of women - presumably a sideline/mainstay of that dealer's stock. Must admit a CD of all the 1970s Mayfair magazines was tempting as an historical record of more innocent times.

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Try the smaller sites. Lots of stuff sold on Amazon is actually sold by third-parties but at a higher price than the third-parties own site (well, they have to cover the cost Amazons fees somehow).

So, if you see something you like on Amazon check the sellers name on google, look for a similarly named site and check the item there. You may well save yourself 10% or more.

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LDS
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It's funny since I bought some photo papers and inks Amazon suggests me to buy the same printer I bought from it a year earlier... or when I bought a CPU and they wanted to sell me more CPUs...

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MrT

"Try the smaller sites."

Absolutely - Plenty of times I've ended up paying more than the delivery charge less than the Amazon listing, and many of the retailers I've used offer discounts to go direct and avoid going through their own Amazon storefront.

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Anonymous Coward

If I WANT a stubble-faced guy in a greasy raincoat to follow me around

I'll contact my local paedo.

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Re: If I WANT a stubble-faced guy in a greasy raincoat to follow me around

Consider the average El Reg reader and the average Marketing person. Which one do you think is more likely to have the stubble and raincoat?

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Re: If I WANT a stubble-faced guy in a greasy raincoat to follow me around

No offence to marketing persons, but I would rather have someone like me following me around.

it could come in handy ... like carrying heavy shopping

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Coat

Re: If I WANT a stubble-faced guy in a greasy raincoat to follow me around

@Adam 52

What about Reg Hacks?

https://regmedia.co.uk/media/186.jpg

(Ok, Lucy Sherriff excepted - she's not wearing a coat)

icon - greasy raincoat

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Facepalm

Or... don't do either cards or IoT, flip the finger, and live a happy life without being Analised by the Marketeers.

But that, of course, is not how forward-thinking people are supposed to Do Things..

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"Loyalty"?

The only reason I use my grocery retailer's "loyalty" card is that I get whacked with a 20% price increase if I don't.

"Loyalty"? Um, no.

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Re: "Loyalty"?

I tend to shop at the same place a lot.

Loyalty? No,

Habit? Certainly.

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Re: "Loyalty"?

20% increase?

Please tell us what store this is so that we can avoid it like the plague.

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Anonymous Coward

Re: "Loyalty"?

"Please tell us what store this is so that we can avoid it like the plague."

Well - Waitrose has a loyalty scheme where you can nominate several products from a selected range - and get 20% off every time you buy them. You can change your choices every three months. That is in addition to any regular discounts for presenting their loyalty card at the checkout - plus free tea and coffee.

It does annoy me too. I refuse to be tracked - even though I could save quite a bit by succumbing to their blandishments. As for loyalty - I've shopped at my local branch since they opened 40 years ago.

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Re: "Loyalty"?

I've heard of people with roughly the same weekly spend trade cards every few months to get around being tracked, maybe you could try that.

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Re: "Loyalty"?

In my area, Kroger. The store is full of price tags that have "with card" under them. Without the card? Much bigger price.

Which is why I simply don't shop there. They're effectively a membership store, where non-members are screwed on price.

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