Other companies using the Loyalty card program.
I have chosen to look at Boots and WHSmiths, a supermarket and a non supermarket, both these companies use the Loyalty program in their stores.
Boots
Like many other stores, Boots offers a reward card, known as the Advantage card, which is pink and credit card sized. This is how Boots operate their system, You fill in a form in store, with your name, address, date of birth, sex, whether you wear glasses, contacts, or are pregnant etc. they use this information to analyse the sort of person who shops in their stores, Waitrose could find this very useful as they will be able to identify there market easier and cheaper.
You get one point for every 25p that you spend in the store, each point being worth 1p.
WHSmiths
WHSmiths is another example to of a store that uses the loyalty card program, They operate on basically the same system as boots, collecting information from their customers in exchange for discounts on items, WHSmiths have more restrictions on what they offer point on though I have been investigating and it seems you do not get awarded points and cannot redeem points against, purchases of gift vouchers, charity products, stamps, National Lottery products, phonecards, book tokens, theatre tokens, tobacco, cigarettes and certain other goods.
When you do spend over £1 you get one point for every 10p spent. So, that's 10 points for every pound spent. This is a table of the points system WHSmiths have set in place:
As you can see WHSmiths are able to gather a lot of market research from all the accumulation of sales, the customers get points which they can use as money in store so both parties win.
Benefits of the Loyalty card program
The customer enjoys the individual recognition, the personalised service, the fast and convenient transactions and the advantageous payment and service conditions which overall will make the customer more loyal to your company as he or she sees the company rewarding them for there business.
The company benefits economically from a database containing detailed information on regular customers. The database can be used to provide personalised service, to target direct mailings and other advertising, and for more effective planning and stockkeeping. It allows companies to make decisions based on primary data.
Another great benefit of the loyalty card program is how well it monitors sales, customer trends, and so on. It follows buying behaviors and records the frequency of consumer visits.
This is highly beneficial to someone who wants to have the greatest knowledge of their business, how it works, and the consumer trends and interests in their business.
Application to Waitrose
Waitrose could use the Loyalty card to its full potential, being able to apply the advantages to its company:
- Use it to monitor customer sales, this would be a valuable piece of information as it shows what people go to Waitrose to buy and if there was a loyalty card program then Waitrose could see how often people buy that product.
- Information about your customers, Waitrose would have a file of the types of people that shop at Waitrose from the form that customers would have to fill in to receive their loyalty card, this would help in their promotion, it would tell them who they needed to promote themselves to and show them what segments of the market they are not getting.
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High customer satisfaction, The customer enjoys the individual recognition, the personalised service, the fast and convenient transactions and the advantageous payment and service conditions, but not only this, through the loyalty card system Waitrose will be able to actually find out what more people think about their service and the customers will be able to show their support.
- With the information on where people live Waitrose can send them advertisements to draw more customers into their stores, with this information they can get new products know and special offers into people houses so that they come into the store, this increases sales which any shop wants.
- By offering discounts in other stores associated with Waitrose the John Lewis Partnership will be able to get convenience goods shoppers into their stores to buy comparison goods therefore increasing the reputation and market share that John Lewis Partnership owns.
Conclusion
I conclude that if Waitrose are able to properly set up their loyalty card system so that it extends into other parts of the John Lewis Partnership, Waitrose will be able to open up their stores to offer people more offers increasing the amount of people who would want to shop there. By offering such a personalised service to customer Waitrose would be promoting their image and gaining customers through word of mouth. The amount of valuable market research that the company would be getting would be so vital to the companies future and its survival against rival supermarkets already offering loyalty card systems.
