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Essay / Research Paper Abstract
This 3 page paper examines the loyalty schemes offered by Boots looking at how it works and why it is so successful compared with other loyalty schemes. The bibliography cites 5 sources.
Page Count:
3 pages (~225 words per page)
File: TS14_TEboots1.rtf
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Unformatted sample text from the term paper:
create customer loyalty. The reason that loyalty cards have been developed is to increase loyalty and well as marketing knowledge to proactively encourage repeat purchases. In the UK the scheme
that is often held up as the most successful is that of Tesco, with the citation of many other supermarkets that have withdrawn or had to change their approach as
a failure to obtain real value from the opportunity. However, one retail chain that is often overlooked is that of Boots the Chemist, with a well established loyalty card following
and potentially the largest customer loyalty card scheme in the world, and by 1999 40% of all counter sales were undertaken with a card (Precision marketing, 1999).
The issue of loyalty is one that is difficult to establish, Howeve,r one point in favour of the boots advantage card, the name of the loyalty
card has been in the press and attention is has been given. There have been several consumer studies that look at the various loyalty cards. Most are criticised are requiring
a very large spend before any benefits are gained Whilst they are no derided, they are seen cynically as a tool only to increase spending. For example, most, including the
Tesco and the Sainsbury and Visa Nectar card scheme give the equal of a 1% rebate. Boots Advantage card has been praised for the high level of return, four points
given for every ?1 spent means that there is a return to the consumer equal to 4% (DArcy, 2003). When additional special offers are added on the current average reward
for each ?1 spent is 6.5 points rather than 4, increasing the rate of return to 6.5% (Boots, 2004). This is a clever marketing strategy, as for the most par,
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