Mark Price, managing director of the British grocery chain Waitrose, thinks many retailer loyalty programs are stuck in the twentieth century and he's having no part of it. Mr. Price has caused a bit of a stir in England by using the myWaitrose loyalty card to attract a broader array of shoppers to the upscale grocery chain. His secret? Give cardholders free coffee on their way in the store and newspapers on the way out — every day.
According to the myWaitrose website, "Nothing says 'welcome' more than a lovely hot cup of tea or coffee, so let us treat you to a free regular tea or coffee every day!" Cardholders simply present their card to enjoy their coffee while shopping or to take out. According to the Telegraph, Waitrose has become the second largest seller of coffee in the U.K. since implementing the offer.
Customers who spend £5 (including the price of select newspapers) automatically get the price of the paper deducted from their purchase price.
"Giving free coffee or free newspapers is disruptive to the market, but I think that is what customers want. I don't think they want a point," Mr. Price told the Telegraph last month. "I mean, what is a point? I think it's meaningless. It doesn't have the affinity you can gauge if you engage with your customers in a different way."
"Waitrose is ahead of the curve; they have tapped into 'generation now'. People are tired of waiting and they are looking for everyday treats and rewards," Zoe Lazarus, partner, global insights at Lowe & Partners, told Advertising Age. "Loyalty points are all about collecting CRM data and [customers] don't get much back."
Do you agree or disagree that point system reward programs out of touch with modern consumers?