Can supermarket loyalty cards encourage us to make healthier choices?

Most recently, Ken Murphy, CEO of the British international supermarket chain Tesco he said at the conference that Tesco “can operate Clubcard data to nudge customers towards healthier choices”.

How would it work and is this what we want? Our latest study, published in the journal Scientific journal of research and reviewgives the answer.

Loyalty programs have been around since the 1980s, with the introduction of loyalty programs frequent flyer programs.

The advancements in loyalty programs are enormous, with some even using game-based approaches such as leaderboards, trophies, and treasure hunts to keep people engaged. The principle of loyalty is based on a form of social exchange, viz reciprocity.

An ongoing relationship means that we regularly operate the good or service because trust the service providerwe are satisfied with the serviceand us consider the rewards we receive reasonable – whether discounts, vouchers or gifts.

In return, we accept the fact that in many cases loyalty programs collect data about us. Our purchasing history, often tied to our demographics, generates improvements in service delivery.

If we accept it, then yes continue to take advantage of rewards programssuch as promotional offers or other discounts. Effectiveness lies not only in presenting us with attractive offers on things we are interested in purchasing, but also on other discounted items that we have not considered purchasing.

Does it work?

So is this the future? The first issue is whether we are satisfied with the collection of data about us. There is a trade-off between the level of personalization desired and the amount of data we are willing to share. Research has shown that the more personalized the programs are, the better the more concerned we are about crossing the boundaries of privacy. For example, many of us dislike personalized communication about services via chatbots.

A second, related issue is that loyalty program data is and will continue to be available huge value for external organizations. For example, market research can operate loyalty program data to more closely track consumer trends. Scientists can use data Down draw conclusions about health behaviors.

While data from loyalty programs is valuable for research purposes, not all shoppers are comfortable with their data being shared in this way. In a 2023 survey of 1,539 people conducted by Yasemin Hirst of Lancaster University and colleagues, 39% said that they didn’t want to share their personal data to academic institutions, and 56.9% did not want to share their personal data with private organizations.

What data people were willing to share also varied: for example, people were more willing to share loyalty card data for research purposes (51.8%) than social media data (30.4%). Generally speaking, people are concerned about privacy and misuse of their data.

All this points to data privacy and permission needed to share personal information with third-party advertisers and data brokers for online shoppers.

The final aspect is what the data reveals. Data from loyalty programs does not give the full picture buyer. We mix and match where we buy food due to our budget and geographical location. Some retailers have a greater reach and delivery in rural areas than others, which further influences our behavior.

This also means that our degree of loyalty ensures only partial image what we end up buying, and how healthy our habits are.

Up-to-date research

In our latest study, Sarah Jenkins and I conducted a study to look at issues related to what Murphy had in mind. We asked 389 people to rate how their grocery shopping behavior could be influenced.

We looked at three categories. One included financial incentives and discount offers. The second method was classic “nudge” methods, such as marking hearty or ecological options, campaigns or educational programs.

Finally, we looked at technology incentives that can be implemented using smartphones or laptops when shopping online. For example, there may be suggestions for food choices or an automated system that will only select hearty food choices. Alternatively, the system could rate your shopping choices based on how hearty they were.

Respondents rated all of these options on whether they could aid promote hearty and green choices. Overall, participants preferred financial methods in general, especially discounts on hearty foods (44.7%). They also considered taxes on unhealthy food to be effective.

The least preferred were sustainability campaigns (6.3%) and automatic sustainability choices (6.5%), such as online shopping algorithms that only offer us sustainable options. One possible reason may be a lack of understanding of what sustainable development actually means.

Behavioral and financial methods were considered slightly more ethical than technological methods, although most people found all options to be somewhat ethical.

That said, techniques to nudge human behavior in the right direction don’t always work. People like or dislike them, depending on a number of factors, including whether it seems effective, whether it is ethical, and whether they actually have desire to change your behavior.

Future options

Market researchers in various ways study our shopping trendsthe same pattern emerges: in about 25% of cases we do our grocery shopping online. The exact percentage varies depending on the country and the foods we buy, but the general prediction is this will increase to approximately 45% in the next 5-10 years.

This will mean further innovation in loyalty programs aimed at both acquiring recent customers and retaining the existing base. Therefore, retailers must be aware of the shortcomings of this approach, including that it does not work on people who are unwilling to change their behavior, that it only provides confined information, and that at some point personalized services may does not want to share his data.

Some of us will continue to enjoy the benefits of these programs as long as we have the chance to make a choice. Indeed, some people want suggestions to make it easier to choose hearty or sustainable options, but others don’t. It’s significant to have a choice.