Nectar figures don’t tell the whole story

Richard Campbell makes an interesting defence of Nectar’s success in response to David Miller’s criticisms (MW last week). Interesting, but flawed.

The figures he presents do nothing to prove that any increase in cross-shopping in the Nectar base has anything to do with Nectar; and although he doesn’t claim this in his letter, I suspect that is what he would have us believe. The reason his figures don’t stack up? What economists call temporal and multiplier effects.

If you took any group of people and tracked them over three years, you would find that their cross- shopping habits increased. This is because time allows them more opportunities to do so. Also, the more collectors you have and the more sponsors there are, the greater the number of cross-shopping opportunities. Simple really, and more a proof of passivity than any active engagement. It all comes down to cause and effect. Of course cross-shopping will have increased within the collector base: the question is how much of this is really due to Nectar?

This is the question Nectar needs to answer conclusively – an answer I suspect its sponsors (and potential sponsors) are very keen to hear. Rather than behave like his political namesake and give us some spin, I think it’s time Mr Campbell provided a more rigorous financial analysis.

Roy Barker

Managing director

Wegener DM Results

London SE1

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