Tesco offers loyalty bonus with discount card

Tesco yesterday became the first leading British supermarket chain to launch a nationwide "loyalty" card - a scheme which allows regular shoppers to tot up points and use them to buy goods at a discount, writes David Nicholson-Lord.

Tesco's Clubcard, which has been tested at 14 stores over the past year, will be available to 8 million customers at its 500 stores from Monday. The company said 250,000 customers have taken up the card at test stores and it had proved "enormously popular".

Clubcard holders must spend a minimum of £10 to obtain two points. After that every £5 spent earns one point, which is worth about 5p. Money-off vouchers are sent every quarter and shoppers have been averaging discounts of £20 a year.

Sir Ian Maclaurin, chairman of Tesco,the second biggest chain after Sainsbury, said it had been working to develop a close relationship with customers. "The Clubcard is a way of thanking them for shopping with us," he said.

However, there are also civil liberty implications. Each Clubcard customer's purchases will be held on computer, enabling the store to analyse buying patterns and target its promotions. Tesco is registering the scheme under the Data Protection Act and says the names and addresses of Clubcard holders will not be passed to any other organisation.

Sainsbury, which has tried loyalty cards to attract customers to new stores, yesterday dismissed them as "electronic Green Shield stamps" that represented poor value for money. It has no plans to introduce them nationally, it said.