Morrisons should be looking to Waitrose, not Tesco, for lessons in loyalty

Consumers see ‘real benefits’ in Waitrose’s loyalty programme, more than they do for any other retailer’s scheme. That’s not just my opinion, that’s the result of a survey of 7,000 consumers by retail analysts Conlumino.


In a poll conducted over three months, they found Waitrose came top in terms of their loyalty programme (as well as customer experience and best overall food retailer). The reasons? Consumers said they found free tea and coffee and discounts on its Essentials range “very appealing”.

Waitrose has only been in the loyalty game for just over three years, launching the myWaitrose card in October 2011. Since then it has managed to earn 4.8m members by eschewing points and coupons in favour of instant rewards.

It also seems to have captured the loyalty zeitgeist. Boss Mark Price has talked at length about the benefits of offering such a scheme rather than making people build up points. It seems consumers might well agree with him.

In a world where shoppers are more promiscuous than ever, what can retailers do to keep them coming back? The answer seems to be to give them a free hot drink and a newspaper.

That is news that won’t please Tesco or Sainsbury’s. In its defence, Clubcard does come third in the poll, behind Boots in second place. However it does seem people are tiring of having to jump through hoops to get good value.

At Tesco they have to accrue points, remember to bring in their coupons and buy their fuel with the supermarket to feel the full value effect. At Waitrose they simply have to turn up with their card. At Aldi and Lidl all they need to do is shop there to be sure of getting the best price.

That is a shift that Morrisons would do well to take heed of when it launches its loyalty proposition later this year. Details are thin on the ground, with a number of options being trialled, although the supermarket did tell Marketing Week earlier this year that it was leaning towards a system that would offer points for fresh food purchases, an area that Morrisons believes makes it distinctive in the market.

There are negatives to coming so late to market on loyalty, as Dalton Philips admits the supermarket has 12 million shoppers and no idea who they are. But it also gives it an opportunity to rewrite the loyalty rulebook and offer something new.

Clubcard has long been held up as the king of loyalty schemes, but the reality now is its costly to run and doesn’t appeal to consumers like it used to. It needs a revamp.

Waitrose on the other hand has a simple scheme that offers it valuable customer insight for a fraction of the cost it takes to run rivals’ schemes. Clubcard is estimated to cost £500m, while Price estimates loyalty schemes give back 1 per cent of revenues. His, he claims, is much cheaper.

Morrisons needs to deliver on its promise to launch a loyalty card that is unique. In doing so it has hopefully taken more learnings from Waitrose than it has Tesco.


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