Loyalty cards have been around a long time. And like everyone else I religiously, swipe my card at the register in the pursuit of “something for nothing”.
But recently I was reading about the incredible amount of information retailers collected on our buying habits. Which is directly linked to the many loyalty programs on offer. These schemes are the ‘frontline troops’ of the information gathering army. In exchange for a few bucks off our shopping every now and then, we actually hand over incredible amounts of information about our personal spending habits.
And more often than not, we consumers aren’t exactly clear about what is being collected, and certainly not how it is being shared. The obvious way of finding out is to take a ‘deep dive’ into the terms and conditions of the scheme, but I imagine (for obvious reasons) many of you reading this wouldn’t have done so.
I have, and what I found was a real eye-opener. Along with the obvious compilation of every individual item we buy, for ‘marketing and research purposes’, they also shared our information with their “trusted” partners. Here’s a direct excerpt from one program T & C’s
“We also disclose aggregated and anonymised (sic) information to our trusted partners (including our suppliers) about Members’ attributes, behaviors, and preferences to enable them to market products and services that are likely to interest you based on those attributes, behaviors and preferences”.
Woolworths Rewards Card Terms and Conditions
By the way, I am not exactly familiar with the word “anonymised” I just hope it doesn’t hurt when they do it! Anyway, as you can imagine huge amounts of marketing data is being generated to be spread liberally to all and sundry enabling a constant stream of “tailored’ advertising messages to our inbox.
Now, this is very, very valuable information for retailers, but all they give us in return is a paltry few dollars worth of discounts or maybe a free flight to Melbourne!
And with so many cases of hackers gaining access to corporate computers, I am now beginning to think that my personal information provided through a loyalty program is far more valuable than the price I am being paid for it.
My gripe is not so much about the collection of data, but rather the value of that data. It would appear when retailers create rewards programs they come off a very low base. That is, we do our shopping anyway, with or without rewards. Therefore a retailer offering anything extra for what we already do is considered a bonus by shoppers. So we accept what are pretty pathetic rewards in ex- change for huge amounts of incredibly valuable market research.
Interestingly, a shopper cannot participate in a rewards/loyalty program without consenting to the collection of all this personal information. Here’s another line from a loyalty card,
“We may not be able to provide our services without your personal information. For example, we may not be able to issue points, let you redeem points for awards, manage your membership, or contact you” Woolworths T & C’s
Some of the reasons for this type of clause are to satisfy strict privacy regulation. However, it also provides ‘carte blanche’ as to anyone else the retailer wants to package up information and supply to. It is a “take it or leave it scheme“.
Now I have absolutely no solution as to how the rewards concept can be improved, short of lots of people deserting it. Maybe if we all hand in our loyalty cards ‘en masse’, large retailers might just ‘up the ante’ in order to retain this golden source of marketing information. Who knows, it could work.
So I for one am now going to say “adios loyalty program”. What do you think? Are they worth it? Let’s know in the comments below. Thanks for reading and see you next time.
