thinking, thinking, thinking...

Somewhat flippantly I said: “I have a Onecard, I use it, but I don’t know why. What’s the point, really?”

To which the cashier replied “Oh lots of people use them. I do. I love getting a discount on everything. Why wouldn’t you?”

This got me thinking about cards and what that bulge in my wallet means.

Living half-way between the New World and Countdown, I shop both about equally. I have a Onecard and a Clubcard that I use because they remind me to. But that’s it for me. I don’t check any balances. I don’t value them. And they have no apparent influence on my loyalty or behaviour other than giving over my data with every swipe.

As an agnostic I believe in the idea of supermarket loyalty cards, but I don’t practice. But it seems like a lot of people do.

According to Inside Retail 94 percent of all grown-ups in New Zealand are enrolled with a loyalty programme and an average of 4.8 schemes per person.

Consumer reports that 42% are points chasers who claim that loyalty schemes are very important to them.

On the other hand, there is a growing concern about our digital privacy and the potential risks of data security breaches. As someone once said: “If the product is free, you are the product.”


Out of curiosity I logged on to see what my Onecard and Clubcard experience might be online. Both dished me a big serving of specials, recipe inspiration and things to win. Onecard certainly knew it was me. They referenced my usual store and gave me a bunch of deals on the things I would have bought anyway. In contrast, Clubcard had me shopping somewhere across town and threw a fairly irrelevant range of specials at me.

Loyalty programmes are a powerful way for supermarket operators to measure customer profiles and behaviour. They can sway preference and lure customers across the street off the back of aggressive suppler-funded promotional calendars. They can be a competitive point of difference when leveraged correctly.

But what’s in it for the customer? The obvious answer might be discounts and value. But is it really? According to Consumer it costs a lot to get a little. $2,000 spent at Countdown will earn you a $15 voucher and $2,125 will earn you $15 in New World dollars. Point Hack claims that earning points from day-to-day spending is very low (a 0.0069% rebate with one programme). They suggest that the best way to improve your gain is to opt in for AA Smartfuel vouchers with Onecard and Air New Zealand Airpoints for Clubcard.

Digging deeper, it seems that loyalty programmes can satisfy in more psychologically subtle ways, according to Saasquatch:

  • A wee warm fuzzy – Rewards provide a small win that triggers a dose of happiness in the form of dopamine.
  • Reinforcement of habits – An adopted ritual that becomes a natural part of the shopping experience.
  • Continual investment – The more they are used the more valuable they become emotionally and the ‘cost’ of not using them increases.
  • Goal anticipation – People look forward to the reward of points or discounts as a prize for their shopping effort.
  • Endowment progress effect – There is an inherent value placed on points that are building to a reward (think coffee card stamps).
  • Scarcity & urgency – Loyalty programmes can be managed like a currency to drive behaviour.
  • Loss aversion – Some hate to feel like they are missing out without points rewards.
  • Social status – Tiered programmes can create a social value in accumulation (ever noticed how some people display their Koru Club tags? Only Gold/Gold Elite seem to do this).

So where does this leave me with my supermarket loyalty cards? I understand how they work, and rationally why I should use them. But they do feel like a weekly Lotto ticket without any of the decent prizes to get excited about.

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