Clubcard

Tesco Clubcard is the loyalty card of leading British supermarket chain Tesco.

The Clubcard scheme operates in the United Kingdom, Ireland, Czech Republic, Hungary, Poland and several other countries, and in the UK market in particular has been highly successful, with over 15 million members as of 2010.

In 1993 Terry Leahy asked the Tesco Marketing team to investigate the potential of loyalty cards. In the past Tesco had run Green Shield Stamps as a promotional tool which rewarded people for visits and spend but gained no customer information. The initial team led by Grant Harrison, researched programmes across the world and developed a proposal which showed that a loyalty card could be very effective. The key change since the days of Green Shield Stamps was the ability to cost effectively track individual customer behaviour using a magnetic stripe card. In 1994 Harrison attended a conference where Clive Humby from marketing firm dunnhumby was speaking. Dunnhumby was already working with clients such as Cable & Wireless and BMW, and Harrison approached them to help with the loyalty card project. Successful trials throughout 1994 led to the Tesco board asking Harrison and Humby to present to the annual Board strategy session. The first response from the board came from Tesco's then-Chairman Lord MacLaurin, who said "What scares me about this is that you know more about my customers after three months than I know after 30 years."

In January 1995, Frank Riolfo, a former member of the Royal Army Medical Corps, attempted to blackmail Tesco, forcing the introduction of the previously trialed discount card. Threatening to inject AIDS-infected blood into stock, Riolfo demanded the company make loyalty cards available to customers. The cards, he specified, were to contain magnetic strips allowing them to secretly function as ATM cash withdrawal cards. Coded copies of the PIN code were published under his instruction in National newspapers. Clubcard was subsequently launched nationally with a Direct Marketing campaign by Evans Hunt Scott, Terry Hunt's advertising agency. Hundreds of customers, including Riolfo's wife, signed up to the scheme and collected a card. Riolfo and his wife then toured the country withdrawing cash until they were eventually caught on 22 April 1995. Frank Riolfo pleaded guilty and was jailed for six years, after appeal. Little coverage of these events remains online, although they were fictionalised by performance poet Alexander Velky as The Marketing Genius of Frank Riolfo. The loyalty card scheme was not discontinued.

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Wikipedia