The supermarket war is in full swing. Last week Sainsbury's not only launched a wonky trolley pledge and a ``Customer First'' campaign promising happy shopping; it also announced it is shortly to introduce a Savacard loyalty scheme in over half its 355 stores. Its competitors, including its rival and usurper in the supermarket sweep, Tesco, are up in arms. Meanwhile the real victims in the battle of the grocery giants are not the retailers, but innocent shoppers forced to take sides as one retailer after another introduces yet another scheme to win our loyalty - and our cash.
"Just our way of saying thank you" is the slogan for Tesco's Clubcard loyalty scheme. So what exactly is this club Tesco has invited us to join? Plush seats laid on for a few select shoppers? Sit-down meals featuring luxury dishes from around the world? None of it. If you join Tesco's club you eventually receive a voucher representing a measly discount of 1.042 per cent. Spend pounds 100 and what can you get? Not a magnum of champagne or a hamper of Belgian chocolates. Just a pound of carrots and a packet of crisps. Tesco claims that five million customers have joined since its card was launched nationally in February. Hardly an exclusive membership list. Wouldn't shoppers just prefer no-frills lower prices?
That's what David Sainsbury, chairman of Sainsbury's, said of the chain that recently - and for the first time - overtook it in annual sales. Little value to shoppers and expensive for the supermarket to operate, he said. Surprising, in the light of his planned Savacard and the fact that his own Homebase chain has had a long-running similar scheme, the Spend and Save Card. Meanwhile, Safeway is experimenting with a loyalty card in 100 of its stores.
If price is the priority, customers should avoid loyalty schemes and storecards. The Consumers' Association points out that Tesco came fifth out of nine in a November 1994 survey of supermarket prices. Other leading retailers fare no better. Laura Ashley and John Lewis charge 30.9 per cent APR if you settle your storecard account with them each month by cheque, while Dixons and Currys charge 32.4 per cent APR. This compares with 14 per cent APR for a straightforward Robert Fleming S&P credit card and 14.5 per cent APR for a Royal Bank of Scotland credit card. How extraordinary - a customer has to pay for his loyalty.
There is a sinister Big Brother aspect to loyalty card schemes. Provided they keep within the requirements of the 1984 Data Protection Act, they can pass on information to other parties. This could mean an insurance company upping the cost of your life insurance because you consume fat instead of lean, aspartame instead of sugar, or gin instead of ginseng.
Loyalty is a strong, emotive word. I am loyal to my friends. To snooping, wallet-teasing retailers I pride myself on being fickle.
What it will cost
Debenhams charge 29.9 per cent interest per month for their store card; House of Fraser 30.9 per cent; Burton Group 29.9 per cent; Harrods 29.8 per cent; Marks & Spencer 26.8 per cent; John Lewis 30.9 per cent. Safeway offer a 1 per cent discount; Homebase 4-10 per cent and Sainsbury's 0.5 to 2.5 per cent, depending on how much you spend.Reuse content