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Loyalty card

A loyalty card is the United Kingdom name of card issued to a consumer by a retail establishment. It is the visible means by which a type of two part tariff is implemented. Prices at which goods are sold are contingent on whether the customer possesses a loyalty card. Prices offered to cardholders are generally equal to or lower than prices offered non-cardholders. (Critics see the lower proces as bribes to manipulate customer loyalty.) Similar cards are available in the United States, but these are generally called discount cards.

Customers requesting the issuance of a loyalty card are requested or required to provide a usually minimal amount of identifying or demographic data, such as name or address. These forms usually entail agreements by the store concerning customer privacy, typically non-disclosure (by the store) of non-aggregate[?] data about customers. Aggregate data are used internally (and sometimes externally) by the store as market research data.

The system of loyalty cards has been widely adopted by many UK retailers. The trend towards adoption was however reversed in the UK in 2001 when the chain supermarket Safeway (UK) abandoned their ABC loyalty card, stating that they preferred to be able to offer lower prices as a customer incentive rather than a points-based cash rebate. Sainsburys, a rival supermarket, have abandoned their Reward points system in favour of a new card, the Nectar loyalty card, which is being issued in conjunction with a number of partners including the petrol suppliers BP, the departments store chain Debenhams[?], and Barclaycard[?].

The chain of high street chemists Boots[?] have a loyalty card which stores the points on a microchip[?]. This has considerable advantages to the retailer from the point of view of data processing since calculation and allocation of points is decentralised to the point of sale[?], an extremely demanding process when placed upon centralised servers.

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