Since I broke up with the supermarket, I have been inspired and interested to hear and read about other people’s efforts to shop more ethically and sustainably. I recognise that there are many challenges involved in avoiding the Big Two supermarkets, and today I want to focus on one: the lure of rewards.
As Jan over at The Gluttonous Housewife wrote, collecting points is a seductive reason to choose the supermarket over an independent store. I too was shocked how quickly my petrol discounts were stripped from my Everyday Rewards card, despite having been a loyal Woolworths shopper for almost 20 years.
But I’m here to tell you: supermarket rewards programs are dodgy.
Ten years ago, when I was living in the UK, there was lots of bad press about the level of information that one particular supermarket, Tesco, knew about its customers. At the time, it was reported that one pound in every eight spent in the UK was at Tesco, and the supermarket company sold everything from mobile phone plans to clothing to insurance.
Fast-forward to now and there is no doubt in my mind that Coles especially has the Tesco business model in its sights. The recent addition of clothing, the increase in own-brand products, insurance, petrol, even the look of Coles is morphing into a home-grown Tesco.
So what does this have to do with the Flybuys card you wave at the cashier?
Supermarket rewards programs are not designed to reward you. They are designed to collect lots of information about you so they can market specific things to you. Not to your type of person, but YOU.
This morning, I found an email from Coles in my junk box. It is entitled: “Jo, your personalised list of this week’s specials.” And like a time capsule, it happens to contain the last nine items I bought the last time I (ever) shopped at Coles:
Now, I know that some people might think, “that’s great!”. I could save about $5 on stuff that I clearly use. But I think it is completely dodgy and it makes me uncomfortable. What do you think?
Here’s what consumer watchdog Choice has to say about shopping loyalty cards:
“Just how exactly much do you get out of a typical rewards program? Not nearly as much as the companies behind them do. Most of these programs offer such poor rewards that you generally save less than a dollar per $100 spent.”
At this point, I should say not all rewards programs are dodgy. Airline loyalty programs make sense to me, our local fruit shop stamps your card when you spend a certain amount and gives you free eggs when you get to five stamps. I also have a loyalty card for my health food shop because on certain days I get 10% off. To me, these are enterprising schemes that encourage loyalty.
But the supermarket rewards programs are on a different level. What you have in your shopping trolley is actually a pretty personal thing and it reveals all kinds of things you may not be aware of. For example: health or weight problems (low-cholesterol margarine, diet foods), whether you’re pregnant, the age groups of your children, whether you’re single, a cat or a dog person. There are some concerns the level of information collected means you could actually be identified. And the supermarkets are sharing this information with marketing and data analytics firms. Read all about that here.
Here’s Woollies talking about how it uses its shopping data to choose people to sell insurance to:
“Customers who drink lots of milk and eat lots of red meat are very, very good car insurance risks versus those who eat lots of pasta and rice, fill up their petrol at night, and drink spirits. What that means is we’re able to tailor an insurance offer that targets those really good insurance risk customers,” Woolworths Ltd director of group retail services, Penny Winn, told AdNews.”
I find this quote chilling. You? Read more about how supermarkets and other retailers use the information they collect in the Choice report here.
If you’re reluctant to break up with the supermarkets because of your rewards program, I suggest you think hard about whether the rewards are actually worthwhile. For example, saving 4c a litre on fuel adds up to only $2.80 if you fill a 70L tank. Is that worthwhile to you? It may well be, everyone’s situation is different.
Personally, I think supermarket rewards programs are a bit of a scam. I’d love to hear your thoughts.