Free at last: Why I’ve abandoned my loyalty cards (And it’s nothing to do with data privacy)

That’s it. I’ve had enough.

I’ve collected my last free coffee, paid for with hard-earned loyalty points.  And now, it’s time to drop the ballast and lighten my wallet. I’m going to abandon loyalty cards from petrol stations, supermarkets, chemists, bookshops, airlines…  you name it. I’m done with the lot of them.

You might quite reasonably assume that I’m abandoning the opportunity to save money because of data privacy concerns, a commonly highlighted issue with retail data. But no, it’s not that. I’m no celebrity in need of a High Court privacy injunction. If someone really wants to know what type of underwear I buy or what kind of music I like, be my guest. Besides I enjoy teasing cold-callers, or just slamming the phone down (where else are you allowed to do that!).

No, the problem with loyalty cards is that they are not designed to save you money, they’re designed to make you loyal to a brand – and that is a major difference. Retailers do this by offering discounts, free goods, or ‘status’ (whatever that is). But it comes at a price. To get a “free” coffee, you first need to buy 10 overpriced ones. And it stops you from sampling other coffee which may be better and cheaper. Brands are terrified by that prospect, so they play on your guilty conscience and blind you into “saving” money.

It gets worse. Take frequent flyer programmes. Even in the days when I jetted around the world in business class for a global multinational, it took me all of 2 years to get to Gold status. Then, after a number of years, I stopped flying and the status went back down to zero in 6 months. They might call this loyalty but I don’t. Besides, what use is it? Most airline lounges are just an empty room with a fridge and a few armchairs. Some of them are nice (like those in Australasia) but most are like the Loser Café from The Apprentice, only with worse coffee.

Of course you can get other rewards as a loyal customer. Like “free” flights that cost £100 in taxes and hidden surcharges.  Or free goods you never knew you needed, like that electric drill that’s still sitting in my garage unused. Or some other free product that prevents you from buying a better one somewhere else, because you can’t justify having two. Or you might get real money off your purchase – hurrah! But don’t do the maths, you could be in for a shock. As the credit crunch so elegantly demonstrated, spending money to save money is a never a good strategy.

Loyalty cards restrict our freedom of choice through manipulative psychology. The best brands don’t need this, so they don’t bother with loyalty cards. Think of companies like Apple or Waitrose. Yes but they are expensive, you say. True, but since I started buying fruit & veg from Waitrose I have saved money. How come? Because it’s more expensive, you choose it more carefully (i.e. only what you need) and you don’t waste any of it. The end result is that you get better quality, cheaper. Everybody wins.

Of course you might say that by abandoning loyalty cards I will subsidise those people who keep theirs. That might be partially true, but it’s it’s not that simple. Besides, if you follow that argument through then I shouldn’t be paying any taxes either.

I’d rather use my precious bandwidth time on the things that really matter, and not have my choices artificially restricted by phoney loyalty. Admit it, how many times have you chosen an indirect or inconvenient flight route with your ‘loyal’ airline, when another one could have gotten you there better or faster? In the short term it might cost more, but in the long term it is cheaper.  And in cases where I can’t afford my preferred choice in the short term, I’ll just wait until I can. Buying the wrong thing now just because it is affordable is the fabulous concept known as false economy.

It’s time to be free again.


3 thoughts on “Free at last: Why I’ve abandoned my loyalty cards (And it’s nothing to do with data privacy)

  1. I stumbled upon a great idea here in Seattle last night at a local (independent) coffee shop. It’s a punch card, with the same idea as many others: buy 10 coffees, get one free.

    The cool thing about this one is that it is sponsored by 10 different indie coffee shops. You have to buy a coffee at each one of the shops. Then you get your free drink at any of the 10 shops.

    They call it a Disloyalty Card.

  2. Certainly there can be a false economy with loyalty cards, and discounts of any kind.
    I notice your picture has too coffee cards, probably no point you being pulled into their loyalty schemes as otherwise you might try the other coffee places and find they are cheaper/nicer. But if there is one coffee shop you always go to, perhaps because it is between the station and your office so you can quickly grab a coffee every day. Then you might as well get a stamp every day. The people who get pulled in and trapped by a loyalty card may be subsidising the loyalty reward of those who get their coffee their anyway, as much so as the loyalty reward-refusers are subsidising them.

    Even when things are reduced because they’re on their sale by date. I don’t pick it up because it’s got a bright sticker on, I look at how much the price has come down. Then I look at would I buy the product anyway. A nice brand at the price of the brand I normally buy is okay. But if it’s still more expensive than I would normally pay, or something I don’t normally eat anyway, well it’s not a saving at all.

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