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Can Loyalty cards really save you money?

In the supermarket and retail market competition is forever increasing. Companies are constantly creating more and more ways to entice shoppers away from potentially cheaper stores, and they are actively encouraging us to frequent their own on a regular basis. They use a variety of tactics such as discounts, marketing campaigns and of course, loyalty cards.

With Morrisons launching its new ‘Match & More’ card this autumn, we ask the question – “Do loyalty cards really save you money?”

Why do shops offer loyalty cards?

Retailers understand the importance of building brand loyalty and why it’s needed to gain repeat visits by customers.
Loyalty cards were developed as a way enticing consumers back to supermarkets by using special offers created just for them, such as double points and money saving deals; all without much cost to the retailer. They know how to get you excited about collecting points, leading you to come back to the shop again and again and spend money.

What shops offer loyalty cards?

There are an abundance of loyalty cards in the UK’s retail market at the moment. They’re everywhere from coffee shops to petrol stations.
We will have a look into the most popular ones, and how they can save you money. You’ve probably heard of them, you may already have registered, so let’s take a look into how they could benefit you.

Tesco Clubcard- Tesco Clubcard is one of the oldest loyalty cards around. It started in 1995, and has been going strong ever since. It offers customers one point for every £1 spent in store. Every point earned equates to 1p worth of vouchers, so 500 points will be exchanged for a £5 voucher.
The vouchers can be used in store; they can be discounted off your shop or in one of Tesco’s many participating restaurants, pubs or attractions.
Vouchers for restaurants and days out; you exchange 250 clubcard points for £5 worth of voucher deals. You can then collect these up and use them in restaurants like Ask or Varsity. A thousand clubcard points equates to £40 in restaurants like Café Rouge, Pizza Express and Prezzo.

Nectar card- The Nectar card is one of the biggest loyalty card schemes around. It is estimated that 50% of UK households own a Nectar car, and dozens of companies throughout the UK participate in it. The average points collected on a Nectar card is two points for every £1 spent. They can be collected in places like Sainsburys, Amazon, Halfords, Thornton’s and many more. Some companies offer hundreds or even thousands of Nectar points for signing up with them, or for booking things through them, such as holidays. There is a list of all the companies you can collect points with on the Nectar website.
Like Tesco clubcard Nectar points can also be exchanged for money off in shops like Sainsburys and Argos, meaning 500 points would equate to a £2.50 discount off your shopping bill. They can also be exchanged for travel all over the world, with Eurostar and Ebookers.

Morrisons Match and More – The Match and More card is the newest of the loyalty cards, it launched in October this year, with the aim of trying to compete with the recent emergence and popularity of discount supermarkets. The card, rather than offering points per purchase, will actually compare your shopping against Asda, Sainsburys, Tesco, Aldi and Lidl and pay the cardholder the difference if any of the other brands are cheaper. Shoppers will get 10 points for every 1p cheaper their shopping would have been in the other supermarkets. Once 5,000 points have been accrued, the shopper will receive a voucher of £5 to spend in store. They then have a period of one year to spend their vouchers, which is longer than most other vouchers given with loyalty cards. Shoppers can also gain extra points by buying certain promoted items in store.
The Match and More card differs from the other supermarket cards in this blog, as the points are based on price comparisons. It does reward customer loyalty by giving you points for every time you shop, even though the amount of points you gain will be based on the price comparison of your basket, not the amount of money you spend. It’s worth bearing in mind that if everything you bought was cheapest in Morrisons, you wouldn’t get any points.

Co-op Membership card- This card is, yet again, very different from the others. A cardholder earns points every time they shop at the Co-op, and then the points are calculated and sent out to members as a share in Co-ops profits, twice a year.
The value of the points is linked into the profits Co-op makes; therefore this card is only beneficial if you use a Co-op supermarket a lot.
This half of the year, as the Co-op lost a substantial amount of money, members received no payment from their loyalty cards.
Cardholders can also get special discounts and offers on Co-op products, and they regularly run competitions for members.

Boots Advantage Card- The Boots advantage card is probably one of the most generous schemes around, offering 4 points for every £1 spent. Each point is worth 1p, so for every £1 spent you get £0.04 back. The points can be spent on items in store, and there is a special Health and Beauty magazine available for all cardholders. There is also money off and extra points bonuses throughout the year.
The downside to the boots card is that it can only be spent in store, and you have to have enough points to purchase a full item. You can not use your points to get money off regular purchases.

Superdrug Beautycard – The Superdrug Beautycard offers loyalty card holder’s one point for every £1 spent. You can only spend your points once you have collected 100 points, and the points must be spent in batches of 100 (you cannot use 299 points to buy an item for £2.99, you must have 300 points.)
Even though the Beautycard is not as generous as the Boots advantage card, Superdrug lets cardholders pay for part of an item with their points. The card also has plus point incentives that are changed every four weeks, allowing shoppers to earn more that one point per £1 on certain items.

Are Loyalty cards worth it?

So the main aim of a loyalty card is to encourage the customer to keep on returning to their store and incentivise them to spend that little bit extra. Loyalty cards do this by using double or triple point incentives, personalised product offers and members only deals; but the over-riding question here is “are they actually worth it?”.

Loyalty cards only really save you money if……
- You regularly use the same shop
- You avoid spending extra on special card holder incentives, especially if you were not going to buy that product anyway.
Don’t be too disheartened, it can be very beneficial having a loyalty card or two and collecting point in a variety of shops. Remember though, to save money and not end up spending extra money, it is best to avoid the pull of collecting as many points as possible. Try and ignore your total until you receive some nice vouchers in the post, or a friendly cashier asks you if you want you £5 you have in points to come off your shopping total.
Loyalty cards may not save you thousands, but they can be a good way to get money off days out and discounts on purchases.
Do you have any good or bad experiences with your loyalty cards? Do you favour one card over another, if so why? If you do have a loyalty card tale to tell please share it with us, our readers would love to hear more.

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