UK study benchmarks credit card rewards

WM Circle Logo

By: Wise Marketer Staff |

Posted on September 28, 2012

UK supermarket group Sainsbury's lags well behind its competitors when it comes to credit card rewards, according to the 'UK Credit Card Rewards Report 2012' by Loyalty Consulting UK.

Tesco leads the way with credit card rewards in the supermarket category, with the Tesco Clubcard Credit Card ranking in the top ten for every level of annual spend analysed in the survey of 51 credit cards.

While Asda has recently launched of its Asda Money Credit card, which significantly improves the value of rewards on offer, the company still lags behind Tesco in every spend category evaluated.

According to Loyalty Consulting's managing director, Mark Bergdahl, "Sainsbury's must rethink its strategy if it wants to compete with other credit cards. When using that card outside of Sainsbury's, consumers need to spend over 80,000 to earn a 20 reward - a return of only 0.025%."

The report analysed the rewards offered to consumers for an annual spend of 2,000, 6,000 and 12,000. The top three performing cards delivered 55 - 60 worth of reward value for an annual spend of 2,000 and 165 - 180 for a 6,000 annual spend (those being the AA Rewards Credit Card, the BHS MasterCard, and the House of Fraser Recognition MasterCard).

For a 12,000 annual spend the top two cards are Virgin Atlantic Black Duo and British Airways Amex Premium Plus, earning between 2,700 and 3,500, with the AA Rewards Credit Card coming in third at 360. Worryingly for consumers, some 70% of the cards evaluated gave customers a reward of less than 20 (or 1%) in value for 2,000 of purchases.

Credit cards offered by Banks and Financial Service Providers are generally poorer performers than those offered by retailers and airlines, and only the Barclaycard World MasterCard Cashback card made the top ten list (coming 9th in the lowest spend level, and with no other cards from these providers appearing in the top ten for any spend category).

Cards offered by Airlines performed better with higher spend levels, but with lower levels of spend they did not perform so well. It is assumed that many of these cards are focused at the business market where frequent spend for travel and accommodation is more common.

More Info: