Changes to how you spend Clubcard points seem to be on the way

Back in January I wrote about Shopper Thoughts, a Tesco-owned market research business which Tesco uses primarily to get feedback on its own business.

Last week it put out a survey about Clubcard.  Most of it was theoretical questions and theoretical answers, but this paragraph seems pretty firm:

Tesco are proposing to give you access to your Clubcard points directly from your Clubcard, rather than your points being converted into vouchers and posted / emailed to you once a quarter. This would mean that you would continue to scan your card as normal to earn points, however, you have total flexibility as to when, where and how you spend your points.

You would of course be able to continue to save your points up for important times of the year (e.g. Christmas), as well as Boosting them with Partners for meals out etc., but you would also now be able to spend your points for money off your shopping whenever it suited you. This is very similar to how the Nectar scheme and Boots Advantage Card currently work.

Tesco Clubcard

What does this mean for you?

Good question.  I don’t think it is bad news – in fact, getting immediate access to your points will be very attractive.  It would allow you to use your existing balance if a short term promotion came along.  At present, a good redemption deal can start and end before the next voucher run comes along.

Let’s brainstorm a few ideas:

Tesco saves a LOT of money on postage because there will no longer be a quarterly mailing – you can’t blame them for wanting to do that

You get immediate access to your points for conversion to Boost deals or for spending in-store – that must be a good thing

More people may decide to redeem their points in-store at face value (which is a very silly thing to do, of course) if they can do it just by swiping their Clubcard.  I don’t know the full economics of Clubcard but this may be cheaper for Tesco than funding deals with Boost partners.

The whole quarterly cycle will disappear – this will lead to a change in the way that special Boost offers are run as these tend to run appear in the weeks after a new voucher mailing at the moment

As mentioned in the comments, this may well mean the end of the 30,000 points quarterly cap which would be good news for major collectors

Will it mean the end of auto-convert?  I would be pleased it if did, since I think people who sign up to this are not thinking it through.  They lose the chance to jump on a fantastic deal from another partner, and in any event points transfer to Virgin and Avios within 24 hours if you desperately need them.

If Tesco decide to go ahead with this it will take a while as every till will need to be reprogrammed to accept Clubcards as part payment.

Change seems to be coming though.  Another element of this is the upcoming Clubcard Boost (double-up your vouchers for spending in-store) promotion which Tesco is saying will be the last one ever …. more on that soon.

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Comments

  1. I don’t much like Tesco, The only reason I have a clubcard is to collect points to convert to Avios! If this conversion is removed, I will have no further need to shop there again. Their loss!

  2. Does that mean no more quarterly limits?

    • Good point. Logically it would be impossible to impose a cap, especially if you can redeem points as soon as they hit your account.

      • Rolling year limit, cf TCB?

      • They will probably roll it into a generic “subject to fair usage” policy, as some other loyalty cards do. Probably a worse case scenario for heavy collectors, as you have no idea how far to push it.

      • jonboy73 says:

        why would it be impossible to impose a cap, surely it would be the easiest thing in the world to do… program in… once the card hits 30,000 points. block any additional points until date x.

        easy as anything??

        worse still would be a monthly cap.

        • Because you can redeem the points immediately under the new model so you wouldn’t let your card hit 30,000 points.

          • Surely the account could still have a limit? By simply not allowing any card to gain over 30,000 points in a quarter regardless of the number of points spent.

  3. How about the money-off and extra points coupons* which come with the mailouts? Would they just be replaced by till-spits**?

    * except I’ve not had any for a year and a half – I think they don’t like me any more
    ** provided you’re not using a self-service checkout or the kiosk

  4. Singing Dwarf says:

    “this will lead to a change in the way that special Boost offers are run”

    A little slow off the mark here – as advised yesterday, Tesco are running the final Boost event in May (https://secure.tesco.com/clubcard/boost/boost-at-tesco/4294967293.cat)

    • I meant Boost as in ‘Boost with partners’, not the in-store one.

    • Sounds like they are moving to earn double points events at Tesco rather than redeem at double value events. Should be better for those who collect for third party redemption’s, hope they leave these alone.

  5. A slight correction to your comment that any change will take a while as every till will need to be reprogrammed – whilt this is true it can be done by an overnight software update to all tills in one go!

    • Will Squires says:

      It could be done that way but I very much doubt it would be. Critically this would need a real-time link with a central Clubcard points server, otherwise people could run up negative balances (as can happen with Nectar/JS at the moment). Compare the speed of a normal transaction with the speed of a gift card or top up transaction for why this might be a problem at the moment (and multiply it by every single till doing it simultaneously).

      JS have been working on sorting this problem. The original project completion date was 2013, I believe, so it isn’t plain sailing by any means.

      • The link is already there (your points are on every receipt and the website updates immediately) – this would purely be a software upgrade which happens all the time on these systems.

        • TGLoyalty says:

          Not sure it is

          Points take a while to post and show on website

          receipts only show the balance as per a date in the past not live

          • Indeed, the balance which shows on your receipt is yesterday’s balance, not today’s. It also says how many points you earned today, but of course it knows that because it’s just processed the transaction.

            Switching from a system which is almost instant, to one which is really truly instant, is much more of a job than it sounds. But then again they must have the systems in place to validate and cancel coupons instantly (otherwise they wouldn’t dare let you print them at home), so perhaps they’ve already done the hard part.

  6. How do you think it will affect conversion bonuses to Virgin/BA? Less/more frequent? Larger or smaller?

    My guess is that with smaller clubcard balances around they will be stronger but less frequent.

    • If not less frequent, they will be less predicable. Realistically, there are only 4 weeks a year (ie the voucher mailing weeks) when a bonus could be announced. That will change under this scenario.

      I wonder what would happen to auto-convert?

  7. Hopefully, life with Avios /BA /Virgin will continue.

    • I suspect that this is profitable such that both partners tesco/ba tesco/virgin would wish it to continue

    • Johnnycl says:

      If anything we might see Avios/Virgin having to work harder (i.e. invest more ££) to retain their share of CC members as the average shopper is likely to be tempted to use points as and when for against general shopping or boost offers.

      I think this is positive news for FF scheme enthusiasts as it increases their competition.

  8. I, as an enthusiastic user of Clubcard for a number of years, would be concerned if they made any negative changes to Clubcard – specifically exchange multiples with boost partners.

    I quite simply shop at Tesco over other main supermarkets due to Clubcard.

  9. I spoke to Clubcard today chasing up some missing points and the CS rep made some vague references to upcoming changes (referring to the end of CC point bonuses like the pet insurance I think). Got the impression she wasn’t meant to mention this tho

  10. would be great if they would expand clubcard boost offers to avios conversions