Leaning into loyalty: driving growth through supermarket programmes

“Loyalty programmes have evolved from simple discount engines into powerful, data-driven growth platforms,” notes Ben Snowman, head of loyalty, personalisation, services and strategic alliances at Dunnhumby. “[As a result], loyalty is now one of the few channels where retailers and brands can both influence behaviour and prove ROI with confidence,” he adds. “This makes it less of a marketing add-on and more a core route to sustained customer relevance and growth.”

Some leading suppliers have already recognised this potential, leveraging loyalty schemes as an invaluable way to both understand and reach shoppers at massive scale.

At Samworth Brothers, for example, the manufacturer used loyalty insights to craft an insight-led promotional plan for the pies and savouries category a few years ago, after poor-performing promotions created a risk of losing in-store space. Drawing on the learnings of loyalty schemes at multiple retailers remains an important area of focus, says Richard Cole, the company’s category director for savoury pastry. “Identifying good value propositions that offer consumers a compelling benefit to trade up is critical. Loyalty data helps ensure promotions and pricing that achieve this are on target.”

Similarly, when US ice-cream brand Halo Top was to set to debut in the UK back in 2018, it used the breadth of Tesco Clubcard data to both understand the different types of consumer that may be open to and interested in trialling the brand, and then engaged them via targeted promotions, explains David Taylor, co-founder of brand licensing and product development agency Brand of Brothers, who spearheaded Halo Top’s UK distribution and marketing. In fact, working with Dunnhumby and Tesco, the brand developed a multichannel campaign, including targeted in-store activation that reached 18.2 million customers, delivered 17% of total brand sales and achieved a 16% coupon-at-till redemption rate, according to Dunnhumby.

“It’s fair to say that the launch in Tesco was recognised not only within Tesco’s own business, but also in the wider retail landscape as being one of the most effective in recent history,” remembers Taylor. And although the brand has now carved out a sizeable niche in the market and become less reliant on loyalty data, he’s clear about its significant ongoing value. “Without Clubcard we would not continue to have the insight into our shoppers’ habits and lifestyles, allowing us to communicate with them in the most appropriate ways and means.”