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Examining The Process Of Electronic Point Data Information Technology Essay

Investigating the mechanism and impact of nectar card in the retail business of Sainsbury’s for promoting and regulating the sales in a regional basis...

1.2 AIMS

This research examines the technology and operations of the nectar card based on the Sainsbury’s holborn.

1.3 OBJECTIVES

To explore the effectiveness of customer centric theory by the implementation of loyalty cards in retail business.

To make a critical review about the operation and success of Nectar card in Sainsbury for maintaining the customer relationship in current business environment.

To investigate more about some practical theories used by Sainsbury for the implementation of Nectar cards in their business.

To evaluate the impact of Nectar card among Sainsbury customers to point out some valuable suggestions thereby to improve the effectiveness of nectar card in business of Sainsbury.

1.4 SCOPE OF THE PROJECT

Information technology plays a major role now days. It makes fast, reliable and secure services comparatively at lower prices to the modern business. The IT theories suggest that” one time investment long time service “that the same policy adopted by Nectar card To analyze the technology and operations of nectar card and to find the drawbacks and problems to improve the efficiency of the nectar card in the retail business of Sainsbury, holborn.

Introduction

In this proposed research is planning to do an in-depth analysis of nectar card used by the Sainsbury at Holborn, London. This research critically analyse and focusing the background of IT environment and different technology used by the implementation of nectar card and how to co-ordinate different functions for the working of nectar card. The aim is critically analyze about the operation and success of Nectar.

Nectar card is a loyalty card as well as a loyalty reward program mainly based in the UK region supplied with the partnership of the business giants like Sainsbury, American express and BP. The nectar card was introduced into UK in later of 2002. (nectar,2009)

Nectar is maintained by the private organization named Loyalty Management Group UK and now it became the part of Group aero plan. The helpline is mainly based on the Tyne and in Mumbai. Nectar card has maintained a 5 year plan from the year 2002 and thus helped to overtake the club card issued by the Tesco and by the year 2010 Nectar card has became popular 2in the UK. (nectar,2002)

Nectar is a loyalty card looks like credit card or ATM card. Now a day’s millions of people using nectar card to gain their loyalty. The main target of my research is to critically evaluate the different functionality and technology implemented by the nectar card for regulating and promoting business of Sainsbury. My research is doing on the regional basis.so the research is based on Sainsbury Holborn .

The main attraction of the Nectar is there are number of partners in it. In addition to Sainsbury's, there are 14 partners including over 400 online retailers have participated in the Nectar programme and 50% of UK households. They collect points when shopping in stores and online, booking a holiday, paying household bills, buying petrol and eating out.

About Sainsbury’s

Sainsbury, An organization with more than 140 years old opened its first showroom in the year 1869 by Mr. John James and Mary Ann Sainsbury from the time of its establishment towards Sainsbury has very well strategic planning for the instant we can very well see that Sainsbury opened its first showroom in Drury lane, it was the one of the poorest area in the in the country England and they started to sell the high quality products at the lower rate which attracted people all over the place and from the time being the rate of success of strategic decision were very high which lead to the growth of the Sainsbury from 1 store to the 800 stores by the year 2010.

“Our mission is to be the consumer's first choice for food, delivering products of outstanding quality and great service at a competitive cost through working 'faster, simpler and together." .(j-sainsbury,2009)

The other main strategy adopted by the Sainsbury was they aim to sell to product under their own brand name and first among them was the smoked bacon. The bacon was smoked in their in store under the smoking oven. Sainsbury had a very large shortage of the workers during the First World War and they started to recruit women to work in their in store and many other store roles were assigned to the women. (j-sainsbury,2009)

In 1950’s Sainsbury our self-service stores are started in the UK much before many competitors have implemented and this had made Sainsbury a different store from others continuously the strategies adopted by the company goes at higher success rate one of the result among them was the in the year 1969 their own brand products accounted for the 50% of their turn over.(j-sainsbury,2009)

"Sainsbury plc.’s present focus is to improve the performance of the core UK supermarket chain. Whilst doing so we will continue to explore and develop growth opportunities in other markets. Through implementing 'Managing For Value' we will stretch our ambitions and challenge the conventional wisdom within the Company, thereby unlocking our potential and delivering value." .(j-sainsbury,2009)

1.5.1 Background of the project

Information technology is the most effective factor now days. Therefore all the business organizations are to be careful in maintaining effective IT related strategies for the effective business. Sainsbury is a well-established supermarket network in London. They have made a strategic approach by using the IT sector as by using the nectar card as an service to the customer where as using it as the information collector for the effective business. They mainly focus to meet customer requirements.

In this proposed research I am planning to do a research on the nectar card used by the Sainsbury at Holborn, London. By using this effective strategy of management Sainsbury have achieved a wide range of customers at Holborn. As they use this card to keep an updated record of data of their customers and to keep a track of their regular customers. By this research is focusing on the main sections on the strategic application of the information technology of the Nectar card in the business management of the Sainsbury.

1.5.2 PURPOSE

To analyze the technology and operations of nectar card and to find the drawbacks and problems to improve the efficiency of the nectar card in the retail business of Sainsbury, holborn.

Some valuable questions about the project

WHY DID YOU CHOOSE THIS PROJECT?

Scope of the loyalty card is vast in the modern business environment. The other reason to choose this subject for my research to improve my IT skills and enhance my carrier opportunities in supermarket business sector. Today’s most of the business functions are based on the information technology, because it carrying a great role. The computer based technology control and co-ordinate the number of tasks in one hand with high reliability.it makes easier the administration task as well as the regular billing and replenishment structure of the business. Nectar is a loyalty card; it makes customer loyalty and bonus points when they are purchase. The loyalty card has the ability to do different pricing mechanism. The hope of this project makes big difference in my carrier as well as the nectar technology.

WHY DID MOTIVATE TO CHOOSE THIS PROJECT?

This project is based on IT pathway. The major motivation is to choose this project is my interest, ability, taste and skills in IT environment. I have an inborn ability to analyze and finding new things. Nectar card was introduced in 2002. But the scope is widely spread in recent times. The nectar card widely used in UK now a day. Most companies now adopted it because of its wide range of scope and use. I am a regular customer in Sainsbury holborn and I have a good relation with them. I discussed several times about the nectar and the implementation to the manager of the IT desk. Then I have seen as they use this card to keep an updated record of data of their customers and to keep a track of their regular customers. By this research I am focusing on the main sections on the strategic application of the information technology of the Nectar card in the business management of the Sainsbury. These entire factors motivate me to choose this project.

BENEFITS OR VALUE OF DOING THE PROJECT?

Benefits and values are often expressed in money terms and advantage makes its benefits. I selected Sainsbury Holborn to doing the project, and head office is located at Holborn near to Kensington College of Business. So I can easily to access data for doing my project. It is the main advantage to doing the project, it reducing my travel and cost. The management of Sainsbury is very helpful and cooperative. The Sainsbury has some valuable things to learn from rather than just choosing the easiest one available. So I think that we to create some value for the numerous hours we would have to spend on the project.

To explore my skills and ability when doing this project. To planned different schedule to complete the project for data collection. Every schedule is very valuable because every part assigned for every task. To Meeting with the different people like managers, IT professionals it makes great exposure and benefits in my carrier as well as my future.

WHAT WILL CONTRIBUTE THIS RESEARCH?

This research should provide comprehensive picture of nectar card technology and its future scope. Loyalty data is enormously useful, guiding store locations and product launches, for example. But if the information is not exclusive, it may not offer the same benefits. This should change the business strategy of Sainsbury’s. The main contribution of this research gives the scope of nectar card in the retail business sector of Sainsbury’s and the IT technology implemented by the working of nectar card by sainsburys.This research will contribute the unlimited scope of information technology in the business area of Sainsbury’s.

WHAT OUTCOME WILL EXPECT FROM THIS RESEARCH?

The company behind the Nectar loyalty card wants to improve data analysis of consumer behavior and shopping trends for retailers outside the loyalty scheme. Loyalty data is enormously very useful to guiding store locations and product launches. But if the information is not exclusive, it may not offer the same benefits.

1.6 CONCLUSION

The supermarket price wars are moving battlegrounds as grocers the use of loyalty cards to attract new customers and retain their existing customers. It is offering double points in several non-food areas. Sainsbury’s claims that nectar card is one of the most popular than ever in the downturn, as the people realize that ‘something for nothing' benefits of the scheme. It claims this is the most significant change to the scheme in the history. Meanwhile, the Nectar card scheme that counts Sainsbury's among its partici­pating retailers. The nectar card operators claim, that they are making a significant increase in the use of their cards during the recession.

CHAPTER 2

2. LITERATURE REVIEW

2.1 LOYALTY CARD:

Loyalty card is an another marketing strategy adopted by many business organization and loyalty card is provided by different organization and marketed by different organization in different name and some among them is the Nectar card, Club card, Reward card etc. Usually loyalty card is a plastic or paper card usually looks like credit or debit card in which the name of the card holder will be imprinted in the face of the card. Loyalty card is the usual name famous in the UK region and its name varies in different region in the world. The other side of the card typically will have a magnetic strip or a barcode so that they can be easily scanned to the system when purchasing the products. (Loyalty, 2008).

Various types of loyalty cards Fig(1.3)

A retail firm in the in the retail industry may issue this loyalty card towards the customers or consumers which can be then used as an identification procedure in order to find the particular customer. The loyalty gives the data of the consumer regarding demography as well as the other relevant data. It gives data such as the address as well as the number of families in the home. Each and every loyalty card issued by the retail merchandise will have customer privacy statement as well as the non- disclosure data about the customers and these data will not be disclosed between the others users of the same retailing sector. These data provided by the loyalty card can be used for the both externally as well as internally. These data can be used to analyse the data such which will be better and favourite brand for the particular customer or whether the consumer is vegetarian or not. (Loyalty, 2008)

2.2 NECTAR CARD: Nectar card is a loyalty card as well as a loyalty reward program mainly based in the UK region supplied with the partnership of the business giants like Sainsbury, American express and BP. The nectar card was introduced into UK in later of 2002. (nectar, 2009)

Nectar is maintained by the private organization named Loyalty Management Group UK and now it became the part of Group aero plan. The helpline is mainly based on the Tyne and in Mumbai. Nectar card has maintained a 5 year plan from the year 2002 and thus helped to overtake the club card issued by the Tesco and by the year 2010 Nectar card has became popular 2in the UK. (nectar,2002)

Trillium Software®, a business of Harte-Hanks, Inc. (NYSE:HHS) and a leading enabler of Total Data Quality™ solutions, today announced that its customer Nectar Card, the United Kingdom’s leading coalition loyalty programme, owned by Groupe Aeroplan Inc, has been judged a runner-up in Data Strategy magazine’s 2008 award for ‘Best Data Quality Initiative.’ (ALDERMASTON, UNITED KINGDOM – 24th October  2008 )

In 2007, in a multi-million pound re-brand, Nectar mailed over 10 million collectors with new loyalty cards replacing ones up to five years old. It was one of the largest ‘recard’ mailings in Europe and a big success. For each collector, a personalized card and later a pack was produced. These had then to be matched together and mailed. In the intervening weeks however, there were 300,000 suppressions on the grounds of data latency. Using the Trillium Software System™, Nectar identified these suppressions saving around £150k in production and mailing costs and ensuring the right cards got to the right people, protecting the integrity of the Nectar brand.

Sainsbury uses the data from the nectar card by the process of EPOS. Sainsbury valuate each and every customer by the process of EPOS services provided by the nectar card. At the time of billing process Sainsbury stores each data in the database through this process they can be able to analyze what all are the products which are mostly sold in the particular day and they can analyze the trends in shopping of the consumers as well as the customers. By looking over the database of each customer they can be able to analyze the taste of the consumers like whether he or she is vegetarian or non-vegetarian through this analyze they can be able to provide particular offer toward for the particular products for the customers and at the same time they can be able to provide offers for the products which are not usually used by the consumer. During each seasons for example during the month of Christmas if consumer or customer consumes wines they can be able to provide seasonal offers for the particular products at particular time. (j-sainsbury,2003).

Sainsbury’s customer director Gwyn Burr said: “Customers are increasingly ‘savvy’ and they shop around for the best value for money they can find. At Sainsbury’s we have lowered prices, offer great value promotions and sell high quality, ethically sourced products – and we reward our customers’ loyalty with Nectar points and money-saving coupons as well.”

2.3 Components of nectar card

Nectar card is made up of high quality plastic. It looks like a credit card that is branded with the company’s logo. The top of the card written nineteen digits number and name of the card holder. This nineteen digits are used for the identification of the card issuer. It contains a microchip that is used to store information. This chip allows a connection to the server for calculating and adding points when a transaction occurs. The fig (1.1) shows the nectar card.

Fig 1.1 (nectar card)

The other types of nectar card made up of magnetic strip behind the Card, that shows in fig (1.2) the front side of the card labeled by the customer’s name and expiry date. The magnetic strip is used to store information. It is made up of iron based magnetic particles.

Fig 1.2 (magnetic strip)

The card is physically read when swiping or reading head. This follows a number of international standards, they are , ISO/IEC 7810, ISO/IEC 7811, ISO/IEC 7812, ISO/IEC 7813, ISO 8583. The ISO/IEC 4909, define the physical properties of the card, including size, flexibility, location of the magstripe, magnetic characteristics, and data formats.

2.4 Trillium Software

Nectar has using Trillium software, that ensure as its enterprise wide data quality governance solution. They capture initial data from multiple sources such as website update forms, phone and letter. The trillium software find data quality issues, cleanness data consolidate collector records. Trillium software using suppression file system and it ensure data meets with Nectars business rules. This software are platform independent because it is compatible with different EPOS software.sainsburys using EPOS software for billing, stock controlling, accounting etc. Good data ensure nectar mailings but sophisticated customer profiling segmentation and targeting offers.

"Data is an invaluable business asset but without excellent data quality governance, this essential resource will quickly decay, damaging operational effectiveness, frustrating attainment of strategic objectives and risking compliance issues, We are proud that the contribution of the Trillium Software System at Nectar Card has been rated so very highly by the judges of the Data Strategy Awards." (Ed Wrazen, October 24, 2008).

2.5 Electronic Point Of Sale (EPOS):

Sainsbury’s adopted electronic point of sale technology for the operations of nectar card.This system always connected to the nectar server. The EPOS system software communicates trillium software when a transaction occurs. With EPOS data are usually used by the retailing groups like supermarkets, hypermarkets, pharmacies, chemists, convenience stores, small independent stores, petrol bunks, cash and carry, off license as well as in pubs and restaurants. Electronic point of sales data are the much useful data to the retailer like the one which when the customer swipe the card at the till of the shop all the details like what all are the things purchased by the consumer will goes towards the marketing wing and as per the data available the marketing wing can able to analyse the customer and they can provide provides rewards and loyalty program according to the taste and nature of the consumers or customers. (Loyalty, 2009).

The trillium software and EPOS ensure error free operations and it ensure guaranteed transaction both these software support online shopping system.

EPOS system support

There are different types of EPOS SYSTEM. But in this research focussing only two types of EPOS system at the character of this research.

They are

Stand-alone EPOS systems

Customised EPOS solutions

Stand-alone EPOS system is connected to different terminals and back-office systems or website while Customized EPOS system can customize their own requirement but it is used for the large retail group like Sainsbury’s, Argos, and home base.

Electronic Point of Sale (EPOS) system is an advantage for the operations of Nectar card for the following reasons

Ensure correct pricing policy

Updating stock levels

Faster accurate and reliable transactions

Improve data integrity

Reduces cashier error

2.6 Hardware components for EPOS (Front end)

There are many hardware components used to communicate with nectar card. The different hardware components are tightly coupled each other. The system comprises of personal computer, barcode reader chip and pin and customer display. The pc and display is the same unit. A strong network connection to connect to the server (described in 2.7) of the computer.

Server

Server is the main computer used for processing and storing the information. The Sainsbury and nectar using commercial server to maintain huge functions. The server always attached hundreds of computers remotely or physically.

Database

Database is using to store data. It ensures the data integrity and quality. It contains a collection of organized data, typically in digital form. It allows data creation and maintenance and ensures searching and updating. Nectar card using relational data base management (RDBMS). The following figure showing database.

Fig 1.5 (Data base)

2.9 File System

The nectar using data suppression files system to manage nationwide loyalty scheme. This file system ensures data integrity and ongoing data management strategy. It ensures there is no data lose involved. Nectar regularly uses commercially available suppression files such asREaD UK’s GAS. This ensures that cardholders’ Nectar experience is as seamless as possible.

2.7 Working of Nectar card

There are number of computers and networks working together to attain the success of the nectar card. The operation is based on electronic point of sale described in 2.3 (EPOS). The EPOS software installed in the server of Sainsbury (describing in2.5) and the till computer. This server is always connected to the master server of the nectar. The EPOS system support data entry from different sources like touch screen, monitors, barcode scanners and keyboards. This system is configured with multimedia barcode scanners, it ensuring fast and reliable transactions for customers or consumers. The EPOS software constantly records sale transactions, updating stock levels and it ensure correct pricing system while it also helping efficient customer service. Sainsbury’s checkout points act as a frontend to communicate with nectar master server. This server always located in remote zone. This computer doing all nectar based calculations. This calculation varies depending upon retailers. That is Sainsbury’s point calculation and rewards allowance always different from other retailers or partners. Different retailers impose different point calculation. The individual server located in the different shops act as a gate way to connect the main server of the nectar when a sale occurs. All the nectar based processes doing the main server of the nectar.

The mechanism is based on electronic point of sale. The Epos terminal is include a standard pc this linked to the back office system (server) and EPOS software. The trillium is the application software used in the nectar server. The processes start from every customer has their own account when they register for nectar card. The server keeps all the records of every customer in the system and identifies customers when the card swipe or read. When swipe the card to the card reader or show to the barcode reader, the reader catch the information from the card and it transferred to the back office system (server) and register this transaction to the cardholders account data of via nectar server. The servers process the data and store for the future requirements. The suppression file system ensures data integrity and data quality. When joining the nectar family they assigned a folder to every customer. This folder act as a home page of every customer when they login online. All the information about the particular customers stored in this folder. The trillium software mines the data from the data base and sorts the data and gives it to the marketing wing. According to this data nectar calculate points and rewards.

The following diagram shows nectar card working

Online user

Till/checkout Sainsbury’s server nectar server

Fig 2.4 (networking of nectar card)

Nectar online provides different shopping systems for online users. The system is based on EPOS system. This system provides online shopping with nectar card. A customer starts online shopping with nectar card the EPOS system tracks customers shopping details and store to the server and this data is used to examine customers shopping trend. A person who can apply online for the nectar card. For this go online nectar.com. Click register From the Home page click in the top right hand corner of the screen.  On the right hand option click on the 'apply for a card now'.  There are 4 stages to complete the registration. Once you have completed the 4 stages of registration your personal details about you and data and promotional options. The final step is agreed to the Terms & Conditions of Nectar then your registration will be complete. They provide manage your account online. The nectar provides point calculator for online users to calculate how much usually spend in a month, how many usually points collect in a month. It gives all the details of your account .To set up the online account need the Nectar card number. It provides details of different transactions, which is shopping details, how many points earned and spent in every shopping, availability of the points.

There are three different ways to earn points and spent points

Swipe at till

In store, hand over the card when you pay at the till and tell the cashier how many points you wish to spend towards the bill. We want to spent points when a transaction occurs it will be automatically deducted from card.

Order online

Browse nectar.com for the brand you would like to spend your points with and Make your selection(s).

Call the Nectar helpline

Call Nectar on 0844 811 0811 the customer care Centre and following the instructions.

The following table showing nectar card standard points value

2.8 Sainsbury’s adopting policies to Nectar point collector rules

The rule control collection and use of points. This is the contract between the loyalty management and each card holder. When a customer applying for nectar card as a primary collector after the registration they can earn points on various purchases. We will set up a nectar account to the nectar provide a facility to records points earned or redeemed. Nectar has different sponsors. They determine the particular transaction how many points earned. Points cannot be redeemed until credited to nectar card account. Redeemed points cannot be used again. Points are personnel to nectar card that is cannot be transferred .Points has no grace period but it closed when the account is closed or nectar programme end. The nectar account holder not earned any points within 12 months, nectar have rights to cancel those account.

Standard Points Values:

Points

Standard Value

Double Value

500

£2.50

£5.00

1,000

£5.00

£10.00

2,000

£10.00

£20.00

5,000

£25.00

£50.00

10,000

£50.00

£100.00

50,000

£250.00

£500.00

100,000

£500.00

£1,000.00

Fig 2.1 (nectar point calculation)

2.9 Customer centric theory by the implementation of loyalty card in retail business

The loyalty card follows customer centric approach. This approach states that to understand customer requirements and needs and give required services at most predominant manner. Sainsbury’s uses nectar card as loyalty card to improve their customer services. They are utilizing information technology with the help of nectar card for customer services and to increase their business. The historical data on customers' shopping choices ensure that coupons are specifically targeted at what Sainsbury’s Nectar card holders actually buy.

Gwyn Burr, Sainsbury's Customer Director, said, "Customers are increasingly ‘savvy' and they shop around for the best value for money they can find. At Sainsbury's we have lowered prices, offer great value promotions and sell high quality, ethically sourced products - and we reward our customers' loyalty with Nectar points and money-saving coupons as well. Our customers appreciate that and over one million new Nectar card holders have signed up in the last twelve months alone to take advantage of the benefits. (Gwyn Burr, Sainsbury’s 2005).

2.10 Policy adopting based on customer centric approach

Nectar card using electronic point of sale based on the customer centric approach. This system usually adopted by super markets, hyper markets and restaurants. This system is much useful to understanding customers taste and needs. Nectar card is very useful for customer centric approach. It has transformed customer behavior and attitudes. This is a systematic transformed approach to identify customer taste and insight. Nectar card has helped Sainsbury’s to create new business strategy easily. When a transaction occur the customers swipe card on the till of the shop all the details like what all things purchased by the customer, that will goes to the server. This server analyses every customers depend up on the data they provide. Based on the data they analyses customers taste and interest without asking face to face approach and provide good services and rewards. This helps to demonstrate that the investments needed to set up and maintain the loyalty programme are not all the additional spend.

Sainsbury’s recommends nectar card because of their customer satisfaction and good feedback and they spend more money to get points and rewards. In United Kingdom there are 150 partners in nectar loyalty scheme. The nectar are partnership with sainsburys,Eurostar argos,wxpedia.co.uk,orientexpress,Homebase,ebay.co.uk,amazon.co.uk,o2,Philips,vue,laithwaiters wine ,LEGOLAND etc.

2.11 The adaptation of practical theories

Sainsbury’s adopted different practical theories for the implementation of the nectar card in their business. The successes of nectar card of Sainsbury’s of its customer oriented rewards and loyalty scheme. They offer points and rewards through nectar card when shopping and filling petrol at Sainsbury’s petrol station. To get money off when shopping or using points from the card. Special offers get when using the Sainsbury’s bank credit cards when accounts are opened get bonus points when shopping. The nectar card scope is wide because the customers can use the card for different purchases at different shops “one card multi usage”. Sainsbury’s provides double points for their account holders at Salisbury’s bank. The bank offer Sainsbury’s nectar credit card. Whenever shopping with nectar credit card can earn double nectar points for two years from the issue of card. 'We know that half our shoppers take vouchers with them when they shop anyway and it's a really practical way to stretch budgets, especially in the current economic climate,' said customer director Gwyn Burr. (http://www.thisismoney.co.uk/news/articlea)

Fig 2.2 (Nectar credit card)

Sainsbury’s offers double nectar points for the following area

Home insurance

Loans

Pet insurance

Easy saver.

In 2002 Sainsbury’s adopted a voucher scheme that was the biggest investment in customer loyalty. By the end of the year they distributed one thousand reward vouchers. They planned to spend millions of pound for the venture. The top executives always closely monitored every process.

They send vouchers to customer’s home depending upon the shopping taste. Sainsbury’s latest “switch and save”adevertising promoted the vouchers. Customers can collect points from petrol station, one nectar point for every litter of fuel.

To improve the quality of offer Sainsbury’s accommodated two types of business strategy to stay competitive price. They are

Switch and save

Shop and save

Switch and save savings 20 percent discounts on standard products, but switch and save communicates competitive pricing policy.

2.13 Collect points and spend points via Sainsbury’s via nectar .com

Sainsbury’s and nectar web portal combined together for special deals that reserved exclusively for online shoppers. Sainsbury’s offer 2 points per £1 every time when the customers shop online at Sainsbury’s via nectar.com.they offer thousands of ranges of products from trusted brands at great affordable prices like apple,sony,Le crenset,tosiba,Panasonic,canon,Christy towels. They offer 50 point for groceries each time for online shoppers. Normally Sainsbury’s online shop give 2 points per £1,but the shopper get additional 50 points.

E-mail alert

Sainsbury’s provides e-mail alert about latest offers for nectar card holders. This system is easy to understand latest product information, price cuts, bonus points and rewards.

Points for bag reuse

The customers can collect points when reuse the bag, reuse at Sainsbury’s recommended gets one point.

2.14 Impact of nectar card among Sainsbury’s customers point of view

The nectar card made great impact of Sainsbury’s customers. The nectar card holders earned billions of nectar points last year. This made to understand the advantage and utilities. The great advantage of customer’s point of view its multi usage facility. High quality service based on a unique selling proposition (USP). Customer can use Nectar card at hundreds of retailers other than Sainsbury’s. Thousands of new customers joined loyalty programme for earn points, discounts and rewards. Sainsbury’s adopted their own policies and procedures for the promotion of nectar card. The approach is specific, measurable, achievable, and set with a time frame for every point and rewards. This is a useful and customer oriented system. The most attractive feature is Sainsbury’s online system. There are 450 online shop participated in nectar online. This system is reliable and useful for the customer’s point of view. The online shop provides points, rewards and discount for online users when they shopping via nectar online. Last November a customer earned 5 million points to pay the EDF electricity bill to direct debit.

The major impact of customer point of view

Online shopping is easier and user-friendly, each shopping get 2 nectar points when the customer spend £1.

Where ever you go I am there, this strategy adopted by the nectar. The nectar scope is wide that covered online, Instore, At home. Giving out, motoring, finance. Their participation travelling different types of shopping taste.

Sainsbury’s provide exclusively online offers to earn point and spend point. There are 400 online partners and hundreds of retailers are the members of the nectar group. So the customers can use the card with variety of companies.

Nectar offers 160 types of loyalty scheme in United Kingdom.

Value of free hold portfolio increased to 9.8 billion, last year it was £2.5 billion, and this made major impact in Sainsbury’s customer point of view.

Followings are the suggestions and the opinions from the customer’s point of view

Companies actually looking for what from the loyalty scheme, the answer is simple, they want to customer for shopping. Big loyalty scheme is really paranoid, because they breaking the data act. The personal information is very important. That should be keep according to data act. Otherwise it should loose customer’s trust.so Sainsbury’s should keep customers data consistently to improve their relationship with customers. To improve the effectiveness of nectar card make sure to enforce data protection laws and make sure customer’s personal information is not being traded illegally. So Sainsbury’s should aware their customers and learn to see their personal information as a valuable resource. Susan lace, the policy officer at national consumer council, she said “From my research I have found people do not know much about how their information is dealt with and how it's handled. They are not very aware of what is going on but when you ask them about privacy, they are concerned about it.”(BBC news 19 November 2004).

Customer’s suggestions for the improve the effectiveness of nectar card

Improve the security feature.

To improve the efficiency of Sainsbury’s shopping web portal as well as nectar web portal. That is to increase bandwidth of the web portal. This reduces the traffic of the web portal.

To provide up-to-date information about latest offers and promotion. Avoid expired data or false data.

Introduce point transfer methods from one nectar card to another nectar card.

To provide 24/7 customer care service through web portal, it will promote the online shopping.

To provide latest offers and promotions via personalized SMS. That will encourage the person to buy.

To give exclusive bonus points their Top point holders, it will improve the customer relationship.


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