Sainsbury’s takes on Tesco Clubcard with Nectar Prices launch

Sainsbury’s is introducing lower prices for members of its Nectar Card loyalty scheme, taking on rival Tesco’s similar proposition, Clubcard Prices.

Nectar Prices offers loyalty customers discounts as high as 50% on more than 300 items, spanning household products, pet food and confectionary. The price of a 200g pot of Nescafé Gold Blend coffee will drop from £8.10 to £4, while 24 cans of Coke Zero will cost £5, compared to £10 for non-loyalty customers. The scheme is set to expand into more categories in the coming months.

Sainsbury’s will also continue to offer personalised discounts to customers who use SmartShop through the Your Nectar Prices offer, which offers up to 30% off products customers buy regularly. The supermarket has stressed that it is the “only” retailer offering this combination of price reductions through its loyalty proposition.

Nectar’s points system will also remain in place. The scheme issued its 1 trillionth point in December, meaning over £5bn in points have been issued to Nectar’s 18 million customers over the past 20 years. Last year at least £220m worth of points were issued, the supermarket claims.

Sainsbury’s CEO Simon Roberts says Nectar Prices will help “millions” of customers save money.

“Our customers really are at the heart of every decision we make and we hope they find that Nectar Prices is an exciting way to bring them consistently great value all year round,” he says.Why Boots is overhauling its loyalty scheme with its ‘biggest ever’ investment in price

In December, Sainsbury’s promised to invest £50m in keeping prices low over the first quarter of this year, bringing the total the supermarket has invested into dealing with the cost of living crisis to £550m.

The following month, Roberts told investors Sainsbury’s had seen fewer consumers switch to discounters Aldi and Lidl over Christmas than its supermarket competitors, crediting its “bolder” approach on value, innovation and service for the success.

Sainsbury’s move to offer loyalty customers lower prices comes just weeks after retailer Boots made a series of major changes to Advantage Card, which also saw the proposition redesigned to offer customers “more immediate” value. From May, Boots’ 15.5 million active Advantage Card holders will receive 10% off the retailer’s own brand range in-store and online, covering over 6,000 health and beauty products.

“It’s definitely all about that immediate benefit and value,” CMO Pete Markey told Marketing Week at the time. “If you look at the way loyalty schemes have evolved in the last 10 years, Tesco Clubcard being an interesting example with Clubcard Pricing, those loyalty schemes are probably shaping that customer perception of ‘I want to get immediate value’. We’re definitely seeing that trend in our business as well.”

Tesco drew the ire of some customers last month by reducing the value of its Clubcard rewards, as the supermarket also focuses its efforts on reducing shelf prices for loyalty members.