Asda weighs up launch of Tesco ClubCard rival

by James Quilter, Marketing 31-Oct-06, 08:30

LONDON - Asda is evaluating a feasibility study into whether it should launch a scheme to arrest a decline in customer loyalty.

Developing such a loyalty scheme would be a major U-turn for the retailer, which has traditionally followed an everyday low prices strategy, eschewing the use of money-off coupons.

The retailer is believed to be impressed with the way Tesco has used ClubCard to generate customer loyalty and information. As part of its study, Asda has been talking to suppliers about costs and evaluating the potential benefits of such a scheme.

According to a source who had seen the study, the costs are the principal hurdle. Asda estimates it could run a suitable scheme for about £60m a year, excluding start-up costs. Owner Wal-Mart would be likely to insist that the funds be taken from Asda's running costs and not from profits.

An Asda spokesman said the retailer was "doing stacks of work looking at customer loyalty and how we can improve it. Capturing data is an integral part of that and the loyalty card is always floated as a potential solution." He denied that it was about to launch a scheme.

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