In another huge moment for the British loyalty industry, a second mega brand has dropped points in favour of an alternative loyalty mechanic.
By: Charlie Hills
Points is arguably the most established of the 6 loyalty mechanics we currently see operating in Britain:
- Points, where members earn points relative to the amount spent, e.g. Boots Advantage Card, Nectar.
- Milestones/stamp cards, where members earn a reward or stamp every time they hit a milestone, such as a specific spend limit, or a number of visits, e.g. Shell Go+, TK Maxx Treasure, My McDonald’s Coffee Loyalty Scheme.
- Rewards Always On, where members have lots of rewards available to access, e.g. VeryMe Rewards from Vodafone, British Gas Rewards.
- Subscription, where members pay a set amount to unlock extra benefits and discounts, e.g. Amazon Prime, Tesco Clubcard Plus, ODEON Limitless
- Tiers, where the more members do or spend, the further they move up the tiers from Bronze, Silver to Gold, e.g. BA Executive Club, Accor Live Limitless, Sky VIP. These programmes are usually (but not always) linked with Points.
- Surprise & Delight, where there is no regular reward/ discount, but members occasionally receive surprise rewards, e.g. Pret.
In January 2020, we researched the appeal of these different loyalty mechanics with YouGov and published the findings in our white paper titled: “What Brits Want from Loyalty Programmes 2.0”. Of the 6 mechanics, points was the most established loyalty mechanic in Britain, but also the most appealing.
81% of Brits find points appealing, but it turns out some mega brands no longer do.
Shell started the trend with the move from the points-based Shell Drivers Club to a Milestone mechanic based on visits and rewards dubbed “Shell Go+”. It launched in the UK in 2019. Shell Go+ is described as “a new rewards programme that rewards you every time you visit. With Shell Go+ you’ll earn visits, instead of points. All you have to do is spend £10 or more on fuel or £2 or more in the shop. You'll get 10% off all hot drinks, deli2go and Jamie Oliver deli by Shell food ranges. You’ll also get money off fuel every 10 visits, and plenty of treats and surprises along the way.” The whole proposition is based on “good things every time you visit”. It’s a huge shift away from the old points mechanic. Whilst it launched in the UK, the programme is now rolling out across other key markets globally.
We spoke to the Shell Go+ UK Team and their agency, Wunderman Thompson, to find out if good things do indeed happen when you switch. Linda Gomersall, Payment and Loyalty Operations Manager for Shell Go+ UK, told us just how successful the move has been, for customers, the business and the brand. She said, “Stepping away from points was a big and bold decision when it came to re-defining the Shell UK loyalty programme. Launching Shell Go+ as visits based programme enabled us to focus generosity on more immediate and holistic rewards. These rewards include member benefits such as savings on food, hot drinks, and car care together with a guaranteed fuel reward delivered to customers on their 10th visit. Comparing Shell Go+ to Shell Drivers Club we are seeing more frequent visits by customers and increased spend on both fuel and NFR (non-fuel retail) making Shell Go+ a real success.”
And now Marks and Spencer’s have followed suit with a complete relaunch of their loyalty programme Sparks. So, what did M&S change? In their own words, they “waved goodbye to the points that customers told us were confusing, and kept all the best bits. And then some!” Marks and Spencer’s have completely ditched points; Sparks is now also a clear Milestone mechanic.
The new programme focuses on rewards (big treats and little thank-yous) and charity donations too. And it has a regular engagement reward where members can win their shop every week. 253 customers won their shopping there and then on day one. Like Shell, the campaign also leads with a “good things happen” message: “Good things happen every time you shop”. So far, the press and social media coverage has been very positive.
YouGov also recently did a piece of analysis looking at the customer impact of the relaunch. YouGov Profiles data indicates that 16% of the population holds a Sparks card, increasing to 43% of those who shop mainly at M&S. And the positive impacts on satisfaction and recommendation of the relaunch are significant. YouGov found “brand satisfaction of M&S customers grew 15.7 points in the week following the launch, while Recommend scores also grew 16.5 points (whether someone would recommend a brand to a friend or not).” These are early indicators admittedly, but the signs look very positive.
So, what now? The data from Shell and Marks & Spencer’s does indeed suggest that, in Britain, good things definitely happen when you switch from a points mechanic to a milestone one. We wonder what other brands will be considering this as they revisit their loyalty strategies? We will be keeping a close eye.
Charlie Hills is a featured contributor to the Wise Marketer and is the Managing Director and Head of Strategy at Mando-Connect.