Nectar plans to become the UK’s biggest digital loyalty brand

Fresh from launching the biggest advertising campaign in its 14-year history, Nectar says it is now committed to becoming a digital-first brand and avoiding the pitfalls of rival loyalty cards that place “short term” price tactics above building long-term relationships.

Nectar has switched all its marketing activity to digital-first and its new ‘Thank You’ campaign features a series of TV ads narrated by actor Bill Nighy, which talk up the loyalty brand’s tailored offers and diverse customer base.

Will Shuckburgh, managing director of Nectar, told Marketing Week: “We are personalising the pre-roll ads on YouTube so if you watch a music video or a sports film, the execution of our ad will change around that theme. It is now all about being clever with our marketing.

“Nectar is one of the most recognised brands in the UK, it has huge trust and people equate us with great value. But we know we need to inject more personality and emotion into the brand, to remind people of the role we play in their day-to-day lives.”

Moving from plastic to digital

The Nectar loyalty points-based card, which can be activated at retailers such as Sainsbury’s and has more than 19 million users, is trying to transition from plastic to digital.

Although Shuckburgh claims Nectar has 8 million users who engage with the brand through digital channels, he admits that only one million users have downloaded the Nectar app to date. This is something Nectar is looking to change.

Shuckburgh explained: “65% of the customers who interact with us on a weekly basis do so through their mobile so it’s clear that mobile is the key future channel for Nectar.

“We used to push out paper statements, with personalised offers, through the post three or four times a year. Whereas through the power of digital channels we send people hundreds of offers each week.

“There is a huge growth opportunity and we are confident we can go from the largest loyalty card business to being the one with the largest mobile footprint. We want to convert all of our 19 million customers over to the app.”

nectar
Nectar’s ‘Thank You’ campaign celebrates the diversity of its 19 million users

Being truthful on price

Away from its bread and butter physical retail business, which sees customers redeeming points at the likes of Sainsbury’s and Homebase, Nectar has also grown partners online. Online shoppers at the likes of eBay and Virgin Trains can now redeem their points digitally while Nectar also recently added new partners such as Café Nero.

And Shuckburgh believes the brand will win in the long-term as it isn’t deploying short-term tactics.

At the moment, the big four supermarkets remain engaged in a bitter price war as each aim to win back customers lost to the cheaper discounters Aldi and Lidl.

However, last week, Tesco saw its price-matching Brand Guarantee scheme banned after the ASA labelled it “misleading”. Despite the influx of price-match, loyalty based schemes on offer, Shuckburgh says it isn’t hitting Nectar as it is “100% transparent” and not untruthful in its price-based rewards.

He concluded: “I think British consumers understand if brands are trying to trick them – they are incredibly savvy.

“People are choosing brands that want to build meaningful long-term relationships. Not just one-off, sometimes untruthful, promotions but consistent value throughout the year. Brands that offer this will win and this is very much the space Nectar occupies.”

Recommended

Nectar founder Sir Keith Mills says points-based loyalty is becoming ‘less relevant’

Alison Millington

Air Miles and Nectar card founder Sir Keith Mills has confirmed that he has been approached to front an acquisition of Tesco-owned data department Dunnhumby, which brought the retailer’s Clubcard to the market and works with retailers and brands worldwide. Whatever the outcome, Sir Keith says points-based loyalty schemes are becoming “less relevant” and will have to change, highlighting the importance of turning data collected into actionable marketing programs.

Comments

There is one comment at the moment, we would love to hear your opinion too.

  1. Mark Chester 9 Apr 2016

    Nectar want to be a Digital First brand but won’t allow consumers to store and use their card on mobile phones instead of carrying around a piece of plastic. Quite ironic!

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