Customer Loyalty Programs in the UK
The recent market turbulence —the rising cost of living, persistent economic uncertainty, and the lingering effects of the pandemic — have left brands in the UK speculating about the future of customer loyalty. Over 56% of customers in the UK are ready to switch brands due to high prices. Loyalty programs in the UK have been the go-to tactic for brands in similar situations.
Many brands, including Starbucks and Tesco, are leveraging loyalty programs to foster customer loyalty. As a result, 2022 saw 71% of customers in the UK being loyal to their favorite brands. Let’s decode how some major brands in the UK are winning customer loyalty.
The Future of
Customer Retention in the UK
Top 7 Loyalty Programs in the UK
1. Marks and Spencer
Marks and Spencer revamped its loyalty program — M&S Sparks, bringing tailored deals, instant rewards, and a chance to support various charities. The program regularly offers customers a chance to win free products. Every week one lucky shopper who scans their loyalty card or app in-store can shop for free.
Benefits of the program:
- Members get priority access to the latest deals and M&S sales.
- Members enjoy personalized deals based on past purchase behavior.
- Members can earn points (“Sparks”) on the go through the M&S mobile app.
- The most loyal Sparks members regularly receive thank-you gifts in the loyalty app.
Key takeaways
- M&S incentivizes customers to shop more and share reviews to collect customer data and curate personalized deals.
- The brand focuses on empathy and emotions to build customer engagement by allowing customers to make charitable donations for purchases.
2. ASDA
Asda took gamification to a whole new level by making missions the cornerstone of its loyalty program. Unlike other programs, Asda members don’t earn points for completing specific actions; instead, they can participate in missions to accumulate virtual money in the cash pot.
The cash pot can be exchanged for Asda Points vouchers, which can be spent in-store and online.
Benefits of the program:
- Members can win extra rewards on their favorite products.
- Members can scan their cards to win milestone rewards.
- Members instantly receive 10% cashback on buying Star products.
Key takeaway
- Asda uses gamification to boost customer engagement with a unique approach to rewarding customers.
3. Nectar
Owned by Sainsbury, Nectar is a multi-partner loyalty program catering to customers of 300+ major brands, including Sainsbury, British Airways, Esso, eBay, and more. With a digital-first approach, Nectar allows members to win 3X more points via the loyalty app. The brand holds a “Nectar Double Up event” every year in partnership with Sainsbury to allow members to redeem points for double the value for a week.
Benefits of the program:
- Members can bag in extra points with partner offers every week.
- Members can enjoy more personalized recommendations from Sainsbury.
- Nectar members can skip long queues with the smart shop feature.
- Members get all-year-round access to special prices on products handpicked for them.
Key takeaway
- Loyalty partnerships with hundreds of brands allow Nectar to offer customers more valuable experiences and rewards.
4. Morrisons
Morrisons replaced its point-based loyalty program with an instant-reward-based structure. The loyalty program allows customers to collect pounds instead of points, which can later be used to deduct money on purchases.
Benefits of the program:
- Members can join the My Morrisons Club of their choice to get more perks.
- Members get regular personalized offers based on purchase behaviors.
- Members enjoy a basket bonus on frequent purchases, which amounts to unique experiences and rewards.
Key takeaway
- Experiential rewards and instant gratification make the customer loyalty experience more exciting and engaging.
5. Co-op membership card
Co-op membership is one of the most popular supermarket loyalty programs. From amazing rewards to various activities, Co-op has many ways to keep customers engaged. For example, the loyalty program app allows customers to join communities, volunteer in groups, participate in activities, and even share their opinion on creating new products or services.
Benefits of the program:
- Two personalized offers each week based on what members regularly buy.
- Rewards earned by members are matched by the Co-op for social causes.
- Special prices on Co-op services like Insurance, Funeralcare and Legal Services.
Key takeaways
- The community-based loyalty program offers a sense of belonging to customers, generating emotional loyalty.
- The opportunities to actively participate in exclusive experiences and give back to society make the loyalty experience worthwhile and engaging to members.
6. Boots Advantage
Boots is among the most rewarding loyalty programs in the UK. Focused more on transactional loyalty, Boots rewards 4 points to the Advantage card for every £1 a member spends. Each point is worth 1 penny, which equals 4% back for each shop.
Members can upgrade to Advantage Plus card for £20 per year, which offers a 10% discount on almost anything in Boots.
Benefits of the program:
- Personalized offers through the Boots app.
- Members get free access to health & beauty magazines.
- Members who are also part of the parenting club can collect double points.
- Students get a 10% discount on purchases.
Key takeaway
- Offering significant returns to customers during inflation encourages customers to shop frequently with Boots.
7. Pets At Home
Pets At Home has created a community of animal lovers through its loyalty program. Like most loyalty programs above, the ‘Very Important Pet(s) Club’ doesn’t offer points. Instead, it grants plenty of other benefits to members and their pets, including exclusive discounts on regularly purchased products, free holidays for pets, and discounts on grooming.
The brand also donates to animal charities with every loyalty card swipe. Furthermore, the lost alerts on the app allow members to search for lost pets.
Benefits of the program:
- Members can enjoy free holidays with pets.
- Members can enjoy exclusive offers with partner brands and get advice on grooming and pet care.
- Members receive tailored vouchers for their favorite brands.
- Help animals every time you swipe your card.
Key takeaway
- Building a community of pet lovers through its app allows Pets at Home to foster long-lasting relationships with customers.
Conclusion
70% of UK customers belong to a loyalty program. With revamping and precise adaptability, brands are navigating through the market with the power of loyalty software.
Moving from the traditional point-based loyalty solutions, brands are shifting towards instant rewards, personalization, and a digital-first approach to win back customers. With the proper strategic consultation, it becomes easy for brands to adapt loyalty programs for results.
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