New supermarket “challenges” that reward shoppers with extra loyalty points for buying more could lead to overspending, consumer groups have warned. Four of the UK’s biggest supermarkets – Tesco, Sainsbury’s, Asda and Morrisons – are now offering members of their loyalty schemes bonus points if they hit spending targets.
The supermarkets all say their schemes offer customers better value and more personalised savings.
But consumer group Which? and debt charity StepChange warned that setting shopping challenges could encourage people to spend more than they can afford. These challenges are the latest development in supermarket loyalty card schemes which are becoming ever more sophisticated.
At the same time, food prices were rising at an annual rate of almost 20% last year – the highest since the 1970s – and are only now returning to “more normal” rates. Competition between supermarkets is fierce at the moment, with all of them shouting about the number of prices they’ve dropped,” said Ele Clark, retail editor at Which?. “But the fact remains that overall food is still far more expensive than it was a couple of years ago.”Ged Futter is a former buyer for Asda and now advises suppliers on how to negotiate with retailers. He said personalised prices and challenges were simply a way for supermarkets to compete for customers.
“They’ll look at products you buy during the course of the month and then they will give you offers to make sure that you buy that product again with them,” he said. The challenges vary between supermarkets and involve shopping more frequently or hitting a spending target on specific products within a set timeframe.
Source: BBC
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