Yahoo Finance John Lewis and Waitrose hire Tesco Clubcard architects in loyalty card plot
John Lewis and Waitrose are preparing to launch a joint loyalty card that will offer personalised discounts in a bid to lure shoppers into stores.
John Lewis Partnership, which owns the department store and upmarket supermarket, has hired the architects of Tesco's Clubcard to boost its loyalty schemes and revive its flagging performance.
A joint loyalty card planned for next year is part of John Lewis’s plans to provide customers with "even more benefits".
It suggests a change in stance among executives within the partnership, who have previously shunned any similarities to rival loyalty cards.
In 2013 Mark Price, then Waitrose’s chief, branded the benefits offered by rivals' schemes such as the Tesco Clubcard and Sainsbury's Nectar cards as "meaningless".
The John Lewis partnership already has a My John Lewis scheme and a My Waitrose scheme, which have five million members and nine million members respectively.
John Lewis and Waitrose trialled a joint membership card five years ago, with 60,000 customers signing up. However, the trial was paused during the Covid-19 pandemic.
The retailer’s new scheme will now be relaunched and expanded, with new benefits offered.
It is expected to focus on offering more personalised discounts for shoppers, which analysts say encourages greater loyalty to stores.
Richard Lim, chief executive of Retail Economics, said there was a "huge direction of travel at the moment" around supermarkets shaking up their loyalty schemes.
"The Tesco Clubcard model, which is being adopted by others now, offers a personalised discounting model that can encourage greater loyalty. But the offers have to be relevant and targeted," he added.
"This appears to get the greatest traction with younger cohorts of consumers too, who are much more willing to share personal data in an equitable exchange of value."
The revamp of the schemes will be led by Dunnhumby, a subsidiary of Tesco that helped create Clubcard in 1994.
John Lewis has struck a five-year deal with the company and has also hired digital promotions business Eagle Eye Solutions, which is run by former Tesco deputy boss Tim Mason who helped launch the supermarket's Clubcard.
As part of this push, John Lewis has poached Tesco's former head of loyalty strategy Emily Wells to run the loyalty programmes.
Ms Wells said she was aiming to take the "loyalty proposition across Waitrose and John Lewis to the next level".
It comes as John Lewis battles to reforge its relationship with customers, having ditched its "never knowingly undersold" slogan last February after almost 100 years.
Supermarkets and retailers are under significant pressure to stop customers defecting to rivals. The cost of living crisis has triggered a wave of switching as shoppers hunt out value and prompted a supermarket price war.
It has led to a renewed focus on loyalty cards. Tesco relaunched its Clubcard in 2020 to offer discounts to members, while earlier this year Sainsbury's announced a shake-up of its Nectar card to start offering instant discounts.
Supermarkets have equally been slashing prices to get shoppers back through their doors, including Waitrose which earlier this year moved to make hundreds of essential items cheaper.
The latest figures by Kantar, released on Tuesday, suggested those steps were starting to pay off, with Waitrose recording its strongest sales growth since the summer of 2021.
The John Lewis Partnership is racing to revive its fortunes after revealing last month that losses had ballooned to more than £230m.
In response, the partnership scrapped the annual bonus for its 80,000 staff for only the second time in its history.
Dame Sharon White, chairman of the John Lewis Partnership, said cost-cutting efforts would have to be scaled up after inflation hit "like a hurricane".
The retailer is aiming to strip £600m of extra costs out of the businesses within the next few years, including overhauling how it runs stores and changing how night staff pick orders.
