Research Shows There’s No Loyalty for Loyalty Programs
According to a new research study done in the UK, loyalty cards do not loyal customers make. The research conducted by NOP (and released by Asda, a division of Wal-Mart) found that:
- Shoppers suspect that loyalty cards push up prices.
- Ninety-three percent of UK respondents would prefer lower prices to a loyalty card.
Consumers also reported that loyalty cards had little to no influence over where they shopped. “Customers aren’t fooled by marketing gimmicks,” said Richard Baker, deputy chief operating officer, Asda. “Shoppers’ real loyalty only comes from offering the lowest prices on the right range of products.”
Asda did away with its loyalty card program in 1999. It is the fastest-growing retailer in Britain with sales up by 11 percent over last year according to UK industry sales figures.
Moderator’s Comment: Do loyalty cards help retailers
acquire and keep customers?
We’re not sure how much loyalty, loyalty cards inspire.
We do know that consumers that shop in a store are likely to use a card if it
is available. Of course, Wal-Mart doesn’t have a card and that hasn’t seemed
to hurt business.