Analysis: As coffee chains hope to emulate the success of Tesco’s loyalty card, where will it end? | SC Media

Analysis: As coffee chains hope to emulate the success of Tesco’s loyalty card, where will it end?

December 7, 2006

As Tesco's Clubcard loyalty scheme has demonstrated, information on your customers is a valuable commodity. The supermarket has attributed much of its extraordinary growth to the scheme, which records every purchase made by its holders.

Last month, Starbucks and Costa Coffee launched enticing cash card schemesthat can be topped up online or in store. The success of these cards isalmost guaranteed. In the US, 100 million Starbucks cards have beenactivated since the scheme launched in 2001.

Should consumers be worried? The coffee cards are likely to be just thestart of a trend towards branded cash loyalty cards from all marketsectors. And we may be issued with similar cards that provide access togovernment services. But where is all this extra data going to be storedand what governs its use?

The Government insists it will respect the public's rights and privacy,but not everyone believes that. A poll in The Guardian showed that morethan 60 per cent of GPs feared that data held on the proposed "data spine"would be vulnerable to hacking, bribery and blackmail. Such fears, anddoctor's subsequent refusal to use the system, are likely to delay theintroduction of a national medical database designed to bring efficiencygains to the NHS.

It seems business is still trusted more than the Government. "Mostconsumers are not aware of how much data is stored about them, but manywouldn't care if they were," says Peter Reid, chief privacy officer atEDS.

He points to research carried out in the US, which found that around 60per cent of the public were of the opinion that companies could have theirdata as long as they didn't abuse it.

The proliferation of data gathering devices is likely to continue untilpeople decide that their data is being abused - or more likely, nolonger feel they're getting a good deal in return for being watched.

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