Asda lashes out at loyalty cards

Asda trading director Tony Campbell has launched a scathing attack on the effectiveness of supermarket chains’ customer loyalty cards, fuelling speculation that Asda could halt its own card trials.

The chain is running loyalty card schemes in 16 stores with two versions available. But Campbell, speaking at the Marketing Society last week, said he doubted that loyalty cards were the best way forward for grocery superstores.

“Delivering the best value is about offering the best prices. To then give a discount on top of that in the form of a card sends the wrong messages to consumers,” he said. “If we are going to offer a discount I would rather put it on price than through a card.”

One leading City analyst says the development of loyalty cards is a topic of internal debate at Asda. He says the finance department argues that the costs of operating the card schemes is high, and they are “unconvinced the sales uplift warrants a national roll-out”.

Asda is trying to establish itself as a retailer with consistently low prices, and the cost of establishing a national loyalty scheme would imply price rises across the chain’s products.

Other grocery superstores offering card loyalty schemes include Tesco, Sainsbury’s and Safeway.