London Daily

Focus on the big picture.
Saturday, Jun 27, 2026

Loyalty cards: How a big yellow label influences what we buy

Loyalty cards: How a big yellow label influences what we buy

Supermarket shoppers have long been on the lookout for yellow stickers placed on cut-price products at the end of the aisle that are approaching their best-before date.

Now the use of the big yellow label has extended to other in-store discounts - specifically lower prices targeted directly at loyalty card holders.

The colour is carefully chosen. It is supposedly warm and welcoming. And these deals, exclusive to loyalty card holders, mark a change in tactics by retailers.

Gone are the days when the Clubcard or Nectar card was used to build up points to redeem for a treat. Now they offer financially-stretched customers lower prices in the hope they do not shop elsewhere.

In return, cardholders give these businesses a deep insight into their spending preferences, and an opportunity to boost their profits.

Retailers are also exploring the potential of loyalty programmes to reward sustainability, and meet their eco targets.

Loyalty schemes have been around for decades


Loyalty points are nothing new. In the 1960s and 1970s, Green Shield Stamps were popular.

Shoppers filled books of stamps to exchange for gifts. Complete eight books and you could claim a new toaster. Fill 155 and a Lambretta scooter was yours.

The Tesco Clubcard took the idea to another level. The supermarket chain first introduced the Clubcard in 1995 and within a year, customers were spending 28% more in its stores.

Now, faced with the prospect of losing customers to the discounters Aldi and Lidl, and in light of the soaring cost of living, there has been a clear shift.

Tesco chief executive Ken Murphy, this week announcing annual profits of £1bn, said the business had "fundamentally repositioned" its discounting in recent times, including its Clubcard Prices system. The retailer claims 21 million UK households use a Clubcard.


On Tuesday, its rival Sainsbury's launched Nectar Prices - hundreds of lower-cost products for its 18 million cardholders. Outside of groceries, Boots recently said it was shifting the focus of its Advantage Card to day-to-day discounts on its own-brand products.

"It costs retailers a lot more to acquire a customer than it does to keep a customer," says consumer insight specialist Kate Hardcastle.

"So they are reminding you that if you are loyal, they are literally treating you differently as a customer. They want a narrative that they are the best and the cheapest."

In response, they hope shoppers with busy lives do not bother to shop around, and fill their baskets in one store as well as making impulse purchases of the products on offer.


Price comparison risk


The pitfall for shoppers is that these loyalty card discounts can make it more difficult to compare prices and work out value for money.

Ms Hardcastle and the consumer association Which? both highlight the difficulty some shoppers have in finding the unit price, rather than just the headline price. For example, what is the cost per 100g of the product, rather than the total price.

Ele Clark, retail editor at Which?, also points out that some of these rewards are unavailable in supermarkets' convenience stores, where those on low incomes and without a car may shop.

There is also the question of digital exclusion. As loyalty programmes migrate from physical cards to apps, then some people may miss out altogether.

The digital transformation still has a long way to go, according to Ms Hardcastle. The expansion of personalised discounts is one such area.

Retailers, if shoppers give them permission, will not only be able to track the store that shoppers are visiting, but even the aisle they are browsing.

That, and smartphone notifications, mean real-time reminders and rewards will soon be available for shoppers.


Rewards for the planet


The future, and indeed the present, use of loyalty programmes will not be focused entirely on price.

Annich McIntosh, managing editor of Loyalty Magazine, says that brands are using loyalty and membership to address customers' demands for sustainability.

The offers range from cosmetics companies providing refillable bottles, to customers collecting loyalty points that - when a target is hit - means the company cleans a beach.

Schemes in the travel sector may also reward more environmentally-friendly choices, shifting away from frequent flyer points.

Ms McIntosh says companies will also maintain a relationship with a customer after a sale, telling them how the product can eventually be recycled.

"This is about changing people's behaviour and making them feel good about it," she says.

The clear benefit for companies is that they can hit their sustainability goals and boost sales because loyal shoppers will return to the brand when they buy the next item.

Newsletter

Related Articles

0:00
0:00
Close
Thames Water and Energy Operators Warn of Peak Demand Risks During UK Heatwave
Government Conference Highlights Push for Evidence-Led Policy Across UK Public Sector
Insolvency Service Reports Improved Confidence in UK Insolvency System
Security Industry Authority Finds Widespread Safety Failures in UK Night-Time Economy
Nigel Farage Expands Anti-WHO Campaign Into United States With New Lobbying Structure
Home Secretary Seema Mahmood Unveils New Safe Routes Plan for Asylum Seekers
UK Government Warns of Peak Electricity and Water Pressure Amid Ongoing Heatwave
New Nuclear Plant in Wales Named Gwyndod Power Station as Energy Strategy Advances
UK Announces First Major Hydropower Projects in Four Decades to Expand Renewable Capacity
Thirteen Men Charged in Major UK Sexual Abuse Case as Investigation Continues
UK Launches Cross-Sector Climate Security Taskforce Linking Environment and National Security
UN Secretary-General António Guterres Calls for Urgent Global Methane Emissions Cuts in London
World Bank Approves $1 Billion UK-Backed Financing Package for Ukraine Recovery
UK Pledges Emergency Aid and Rescue Team Deployment to Earthquake-Hit Venezuela
Bank of England Holds Interest Rates at 3.75 Percent for Fourth Straight Meeting
Record-Breaking Heatwave Puts Strain on UK Health Services and Energy Networks
London Ambulance Service Sees Record Emergency Demand as Heatwave Intensifies
British Chambers of Commerce Warns of Prolonged Weak Investment Climate Through 2027
Bank of England Holds Interest Rates as Inflation Risks Persist
UK Construction Sector Faces One Percent Contraction Amid Cost and Investment Pressures
Former DUP Leader Sir Jeffrey Donaldson Convicted of Sexual Offences
Church of England Appoints Dr Linsay Cunningham to Lead Faith and Public Life Division
UK Armed Forces Day Marked Nationwide With Events From Aberdeen to the Scilly Isles
Rising Tensions in Edinburgh Prompt Joint Warning From Scottish Local Government Leaders
UK Construction Sector Forecast to Contract One Percent in 2026 on Cost Pressures
UK Parliament Backs 87 Percent Emissions Cut as Government Deepens Electrification Drive
British Chambers of Commerce Forecast Weak UK Growth as Investment and Demand Slow
Bank of England Holds Interest Rates at 3.75 Percent Amid Energy and Inflation Uncertainty
London Ambulance Service Reports Record Surge in Life-Threatening Emergency Calls During Heatwave
UK Parliament Approves Legally Binding 87 Percent Emissions Cut Target by 2040
United Kingdom Records Third Consecutive Day of Record June Heat as Europe Faces Worsening Heatwave
Robert Jenrick Defends £5 Million Donation to Nigel Farage Amid Political Scrutiny
Plymouth Museum The Box Wins 2026 Art Fund Museum of the Year Award
UK Government Faces Backlash Over Plans to Use Former Military Sites for Asylum Accommodation
Labour Party Faces Pressure Over Cabinet Stability as Senior Figures Clash on Policy Direction
Heathrow Airport Forecasts Passenger Decline in 2026 as Costs and Climate Disruption Mount
UK Energy Regulator Approves Expansion of Long-Duration Storage to Boost Power System Resilience
Crown Estate Reports Third Consecutive Year of £1 Billion Profit as Debate Over Royal Finances Intensifies
Teenager Charged With Murder in Wales Following Death of 14-Year-Old Boy
Nottingham University Hospitals Maternity Failures Trigger Calls for Public Inquiry Into Patient Safety
EasyJet Rejects £4.9 Billion Takeover Offer From Castlelake but Keeps Door Open for Further Talks
Record Heatwave Triggers UK Transport and Infrastructure Strain as Heathrow Revises Passenger Forecast Downward
Ofgem Approves Sixteen Long-Duration Energy Storage Projects to Strengthen UK Grid Stability
Labour Government Faces Internal Tensions Over Cabinet Decisions and Net Zero Policy Direction
British Food and Drink Exports Fall to Decade Low Amid Trade Friction and US Tariffs
Great Britain Grid Operator Spends £10 Million to Stabilize Electricity Supply During Heatwave Demand Surge
UK Parliament Committee Calls for Urgent National Adaptation Strategy as Extreme Heat Strains Public Infrastructure
Record-Breaking Heatwave Pushes England’s National Health Service to Critical Incident Status as Hospitals Struggle With Surge in Emergencies
UK Government Launches Review of Voluntary National Insurance Contributions System
UK Planning Inspectorate Reports Key Infrastructure and Planning Milestones in Annual Review
×