Time you put a price on loyalty
TENS of millions of us avidly collect reward and loyalty points, but we are not as diligent when it comes to spending them. The average shopper belongs to five different loyalty schemes, collectively earning around £5.7billion in rewards every year.
Britons earn on average £112 each year in loyalty points, but a savvy 4 per cent earn more than £500, according to TopCashback.co.uk.
However, separate research from accountancy firm Deloitte shows that more than 10 million have unused loyalty points, with barely half redeeming all their rewards. Head of consumer business research Ben Perkins said that while traditional loyalty schemes are still popular, they need a rethink: “Consumers want to be recognised and rewarded as individuals, not as faceless points collectors.”
He said retailers and other businesses need to build more personal loyalty programmes. However, in the meantime people should make the most of the existing schemes, so what’s out there?
On the cards
Tesco Clubcard is the most popular UK scheme, with customers earning a point for each £1 spent to be redeemed in store or exchanged with partner retailers such as Pizza Express. Boots Advantage is also popular, giving four points for every £1 spent, with each point worth a penny.
Sainsbury’s Nectar card scheme allows customers to earn and spend points at more than 500 brands, including Argos, Debenhams, Body Shop, Vue cinemas and many more. Morrisons’ More scheme also lets you earn points on your shopping.
Loyal Co-op members receive 5 per cent cashback on own-brand purchases, while a further 1 per cent goes to charity.
Restaurants offer loyalty schemes too. For example, diners with a Nando’s card can earn “Chillis” towards free meals when they spend more than £7 on food and drink.
Almost one in five of us belongs to an air miles scheme such as Avios or British Airways Executive Club.
Some gas and energy firms offer incentives too. For example, First Utility customers who fix their energy prices for one, two or three years get discounts on high-speed fibre broadband. Sky boasts a loyalty programme for long-standing digital TV and broadband customers.
Get it back
You can also recoup money when you spend by signing up to a cashback site, such as TopCashback and Quidco.com which MoneySaving Expert.com recently cited as the two best cashback sites in the UK.
Compare cashback levels carefully, because they can vary greatly from site to site, while deals are constantly changing. TopCashback is offering 8 per cent cash back at Iceland, £110 on BT Infinity broadband, £90 on energy with First Utility and 12 per cent on hotels booked with Expedia. Quidco has deals with 4,500 online brands and claims its average member saves £280 a year.
TopCashback.co.uk director Adam Bullock recommends signing up to every loyalty scheme you think may be useful: “Even if you do not shop with a retailer every week, it is worth joining for when you do.”
Once you have signed up, be sure to register for their marketing emails as most retailers will send members extra deals and discounts, he adds.
Double up by also using a loyalty credit card too: “You can get extra points by using a cashback credit card when shopping with Tesco while also earning Clubcard points.”
Where possible, delay spending until the retailer is offering a special deal such as double points.
It may also be worth taking time to work out the best way to spend your points. Bullock adds: “Some retailers will boost their value if you make certain purchases or convert your rewards into Avios points.”
Remember to focus on getting the best value deal, rather than the largest amount of cashback. Also, beware of running up a large points balance, just in case the company goes bust, as has happened to some smaller cashback sites.