The article Card Sharp (MW December 14), in weighing up the success and value of loyalty cards, overlooked their most valuable attribute. The purpose of loyalty cards is to identify the customer as an individual. If a company is not interested in customising its service, there is no point in identifying individuals and compelling them to use a loyalty card.
If companies have only the front-end systems – this is not a loyalty scheme – it is an elaborate Green Shield Stamps-type incentive. After a time, people realise that collecting points costs them money.
Most consumers say they value convenience, service, price and variety – in that order. Smart retailers could use this knowledge to their advantage. For example, a retailer might offer to collect regular purchases and store them in a collection isle on the day the individual does her shopping, meaning she only has to shop for more interesting items.
Internet shopping, which effectively replaces loyalty cards, will usurp them. Meanwhile, those who run card-based loyalty schemes should be warned that the attitude of customers invited into a one-to-one communication will change.
Sybase Business Intelligence