Loyalty cards, collecting points from UK shops

Posted - 14/05/12

Loyalty cards have proved immensely popular with UK consumers: providing the backbone of marketing scheme's for many stores, such as: Sainsbury's, Tesco, Boots, Asda and Morrisons.

Loyalty cards are simple to understand: you sign up via the postal service, telephone or the Internet; once accepted you are issued a card - which is similar or identical to a credit or debit card.

Once a consumer has been signed up, they will then receive points for every £1 spent at that specific shop. When you purchase any goods, you will have to have the card swiped - or enter it's number on the online checkout process - for the points to be added to the card.

Once points have been built up, they can then be used to purchase items with. Some loyalty cards - such as the Nectar card - work with multiple retailers, such as: Amazon, Homebase, Sainsbury's, Vision Express etc. On the whole - at least with Nectar card - you simple hand over the card at the till, and ask for the points to be removed from the bill.

One criticism of loyalty cards is that the rewards points are factored into the initial cost of the products; therefore, never benefiting the consumer in the long-term. Critics of loyalty cards believe that prices would be lower if the shops did not run loyalty promotions or rewards.