Supermarkets accused of 'locking out' thousands of shoppers from money saving loyalty deals

Many major supermarkets are now offering money saving deals to loyalty scheme members

Shoppers who do not have smartphones are being “penalised” as they are missing out on money saving deals offered to loyalty members experts have warned.

This means that certain groups could be paying “disproportionately more” for their weekly shop than they need to with the main group affected being the elderly the Telegraph reports. However, anyone unable to afford a smartphone or who chooses not to use one could be at risk of being excluded. In 2023, around 87% of UK adults owned a smartphone according to data from Finder.com, and only 69% of those aged 65 and over use a smartphone. This means potentially thousands of people could be impacted.

Over the last few years, supermarkets and major high street retailers have pivoted towards app-based shopping and have encouraged shoppers to sign up or become members to gain access to special deals and lower prices. Currently, the majority of major supermarkets such as Tesco, Sainsbury’s, Asda, Lidl, and Morrisons have member-based app loyalty schemes. According to data from retail analysts Mintel four out of five shoppers are a member of at least one loyalty card scheme.

Figures from charity Age UK reveal that a third of over 75s do not use the internet at all, amounting to 1.6million people. Over two thirds of this age group also struggle with passwords and understanding how security checks work, which limits their ability to use the internet.

Caroline Parkes, chief strategy officer at global marketing agency RAPP, said: “Increasingly, offers are being pushed purely in the digital space. With such high levels of over-75s not using the internet, let alone having a smartphone or being able to understand how apps work, you’ve got a huge proportion of what can be a very vulnerable part of society who cannot get access to [certain deals].”

At Asda, customers can use the supermarket’s Asda Rewards scheme and shoppers can get 10% off the retail price when they buy certain promoted items – however, this is only available on the Asda Rewards app. Lidl Plus rewards shoppers with money off coupons depending on how much they spend in store, customers can also be entered into competitions to win more shopping vouchers – but again this is only available to those with the Lidl Plus app.

Morrisons More is an app-based loyalty scheme now after replacing its physical cards in 2021. However, the supermarket chain did a U-turn and brought back the physical cards, but you cannot pick them up in stores – instead, you can only apply for them. You can do this through its website, app, over the phone and in-store and you have to wait up to two weeks for the card to arrive.

Tesco does have physical Clubcards available, however in order to sign up for the scheme you do need to register your account online or through the supermarket’s app. The supermarket’s website did not confirm whether you could register in store. Even though the supermarket has its physical cards, it is digitalising its loyalty scheme more and more. Most recently, the supermarket’s Easter competition offered shoppers the chance to win one of 50 £200 vouchers – but only if they scanned a digital Clubcard at the till.

Dan Wilson, vice-president of supply chain consultancy firm Proxima, told the Telegraph that major retailers were keen for customers to install their apps because of the amount of data that can be harvested. He said: “They can see if the customer saw an offer and then acted on it and bought the product – apps help them close the loop.”

Several supermarkets, including Tesco and Sainsbury’s, now own huge digital media companies which use data from loyalty scheme members for advertising purposes. On top of this, they can also sell data on customers’ shopping trends to brands which Wilson said is viewed as “gold dust”. Unlike physical loyalty cards, the apps can also allow retailers to track where their adverts and promotions have been successful.

Mr Wilson added: “They can see if the customer saw an offer and then acted on it and bought the product – apps help them close the loop.”

It was reported that Tesco and Sainsbury’s were making £300million on selling customer data they received through their loyalty schemes.

Loyalty schemes are being looked into however, in November last year, the Competition & Markets Authority watchdog launched an investigation into loyalty card pricing after concerns raised by the consumer group Which? that supermarkets were using “dodgy tactics” to try to get shoppers onto their schemes. The CMA will also examine if any groups of shoppers are disadvantaged by these promotions. An update on the investigation will be published in July, with the full review expected to be completed by the end of the year.

Major supermarkets including Tesco and Sainsbury’s have all repeatedly denied claims that customers were “losing out” if they were not signed up for loyalty schemes. The Mirror has approached Tesco, Asda, Sainsbury’s Morrisons and Lidl for comment.