REWARDS AND LOYALTY PROGRAMS


The well known author, Scott Adams, introduced the word "confusopoly" in his book 'The Dilbert Future'. The word is a portmanteau of confusion and monopoly (or rather oligopoly), defining it as "a group of companies with similar products who intentionally confuse customers instead of competing on price". Adams singles out Telephone Plans together with Reward Schemes, especially Frequent Flyer Progarms that deliberately confuse rather than inform.

Many companies offer rewards and Loyalty Schemes to encourage regular customers to spend more money in their own stores.
The most notorious of these schemes was the Petrol Discount Coupons offered by Coles and Woolworths Supermarkets. It was argued that the excessive fuel discounts (up to 30 cents per litre) were being financed through higher grocery prices.
After several hearings the ACCC ruled that the discounts should be limited, and the two companies agreed to limit discounts to the original four cents per litre.
ACCC ruling on Fuel Discounts
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Articles about Reward Schemes:

Most loyalty schemes often require excessive spending to attain significant Rewards.
The Customer will benefit most if they just use the cards for their normal shopping.
Article about Credit Card Rewards from 'The Age'

The major Credit Card providers also offer Reward Schemes, but the customer will have to pay an annual fee
Reward Credit Card Review (check the figures with the provider)

Articles about Privacy Concerns:

The Flybuys Card was introduced to encourage loyalty, but has provided the owner with extremely valuable customer information. Article about FlyBuys Data Sharing from 'The SMH'

In most cases, people appear happy about allowing supermarkets to keep track of what they buy, and appreciate the email messages reminding them that their favorite product is on special this week.
In the following Whitepaper by Monash University it was noted that only 2.4% of people did not have the card for Privacy reasons.
[The hidden side of loyalty card programs December 2009, Professor Steve Worthington, Monash University - Josh Fear, The Australia Institute]
Whitepaper on loyalty card programs

Reward Scheme web sites:

--- There are also many other specific retailer Loyalty Cards.
Latest Version 07-MAY-2014 11:21 PM.
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